Telecom Min to serve demand notice on Bharti Group soon

The Department of Telecom (DoT) has prepared a draft demand notice and the same has been sent for legal vetting, sources in the ministry said, adding that meanwhile, the department is working out the licence-wise pending dues owed by the Bharti Group of companies.

A special audit of the accounts of Bharti Airtel and its allied group of companies for the years 2006-07 and 2007-08 was conducted by the DoT in order to verify whether proper Adjusted Gross Revenue (AGR) statements were submitted and the licence fee thereon was paid correctly by the telecom firm.

The auditor had more than a year ago submitted a report and pointed out some discrepancies in the account statements, with a few of them under dispute in telecom tribunal TDSAT.

The DoT conducted a similar audit for five leading telecom firms. Besides Bharti, an audit was conducted for Vodafone-Essar, RCom, Idea Cellular and Tata Teleservices. All the auditors have submitted their reports and similar action is being contemplated against all the companies.

According to sources, the special audit had revealed about Rs 100 crore pending from Bharti, which had claimed that its accounts were absolutely clear and the amount was only due to a difference in interpretation of some of the revenue heads.

"The under-reported revenues pointed out by the special auditors fall under two categories -- revenues to be taken for the purpose of arriving AGR as per the terms and conditions of licence agreement and not covered by the TDSAT judgement of August 30, 2007; and revenues to be taken for the purpose of arriving at AGR as per the terms and conditions of licence agreement, but disputed by the TDSAT in the same judgement," according to officials in the DoT.

Details of the under-reported revenues by Bharti Airtel and its allied group of companies, as found by the auditors, fall under these two categories.

It is proposed to issue demand notices to the companies circle-wise for under-reported revenues as pointed out by the special auditors along with up-to-date interest due, sources said, adding that a draft demand notice has been prepared and it has been proposed to get the same vetted by the legal advisor of the DoT.

In the meanwhile, circle-wise calculations are being prepared and as soon as the vetting of the draft from the legal advisor is received, demand notices will be issued, they added.