AGR dues: DOT bats for allowing telecom firms to make staggered payment

In an attempt to provide relief to debt-hit telecom firms particularly Vodafone India Limited (VIL), the Department of Telecom on Monday moved a proposal in the Supreme Court to allow telecom companies to pay adjusted gross revenue (AGR) dues over 20-years.

Solicitor General Tushar Mehta made a mentioned before Justice Arun Mishra headed bench seeking the top court permission for provide relief to telecom firms from paying AGR immediately.

The DOT, which also pleads with the SC to modify AGR judgement and subsequent orders, requested the top court to allow payment of dues in installments with an interest rate of 8% per annum. Interest on principal, penalty and interest in penalty should not be charged beyond date of the AGR judgement delivered on October 24, said the DOT proposal.

While asking the SC to approve the relief proposal, the DOT said that telecom sector is facing tough time and collapse of any service provider will lead to job loss, negative impact on other sectors of the economy and foreign direct investment sentiment.

Closure of one or more telecom service providers also adversely impacts the digital connectivity in the country, e-commerce, e-banking and e-government, the DOT said said in the application.

The Apex Court on October 24 upheld the DOT definition of the AGR, which included rental receipts, dividend income and income from any other telecom activities of the companies. The judgement came as a major blow to telecom firms as they have to pay Rs 1.47 lakh crore due to the government.

Both Bharti Airtel and Reliance Jio have paid their entire amount of Rs 18,004 and Rs 195 crore respectively. However, crisis-hit Vodafone was able to pay only Rs 6,854.

The DOT initially claimed that the Vodafone dues was Rs 53,000 while the company countered saying it had to pay only Rs 21,533 crore including penalty and interest.

Vodafone, which got severely hit due to the top court judgement, earlier said that unless the government provide some relief, it was difficult to continue the services. It also demanded the government to reduce the licence fee and specturm usage charges and GST credit of Rs 8000 can be adjusted against the dues. It also requested the government to allow it to pay the dues in 15 years period.