Vodafone Idea to seek relief, penalty waiver from govt

Facing over Rs 21,000 crore liability in interest and penalty alone after a Supreme Court ruling on the definition of telecom revenues, Vodafone Idea on Friday said it will approach the government for relief, including a waiver of interest and penalties.

Vodafone Idea, Bharti Airtel and other telecom operators may have to pay the government a whopping Rs 1.4 lakh crore following the Supreme Court order on Thursday that sent shock waves through an industry already grappling with billions of dollars in debt and an intense tariff war to retain customers.

In a filing on Friday, Vodafone Idea Ltd (VIL) said the apex court’s verdict on the Adjusted Gross Revenue case, represents a “significant event”, and has financial implications, which the company is reviewing. VIL board met on Thursday evening to discuss the issue, it said.

“The judgement has financial implications, which we are reviewing. We will engage with the DoT (Department of Telecom) in order for it to consider granting relief, including a waiver of interest and penalties,” Vodafone Idea said in a BSE filing.

VIL noted that the judgement has upheld the Telecom Department’s demands, which (as per its submission in the Supreme Court) included Rs 6,871 crore in licence fee balance, Rs 13,006 crore in interest on the balance licence fee, Rs 3,206 crore in penalty and Rs 5,226 crore as interest on the penalty. In effect, the total outstanding as on July 2019 as per submission of Telecom Department adds to Rs 28,309 crore, it noted.

“We cannot presently comment on the correctness and completeness of the aforesaid figures. The company is studying the judgement and we will evaluate our next steps,” it said.

The top court had upheld the government’s position on including revenue from non-telecommunication businesses in calculating the annual adjusted gross revenue (AGR) of telecom companies, on Thursday