NEW DELHI: The Supreme Court on Tuesday granted telecom operators 10 years to pay fees related to adjusted gross income (AGR).
The development comes as a relief to Vodafone Idea Ltd, whose survival would have been a concern even if the higher court had not staggered the payment. The company owes more ₹58,000 crore in AGR installments.
A three-judge high court headed by Judge Arun Mishra ordered telecom operators to make an advance payment of 10% of their AGR fees, and the deadline for staggered payments will begin on April 1, 2021.
The department of telecommunications (DoT) had appealed in March to the supreme court requesting 20 years for the payment of AGR fees, including the charge for use of the spectrum, the license fee, interest, fines and interest on the fines. However, the Supreme Court has had reservations about giving 20 years to telecommunications companies, expressing doubts about the recovery of quotas, especially from Vodafone Idea, which is reeling from liquidity problems.
Vodafone Idea and its rival Bharti Airtel requested 15 years for the payment of AGR fees, while Tata Teleservices Ltd requested between 7 and 10 years. Reliance Jio Infocomm Ltd, which launched in September 2016, paid its relatively miniscule fees of ₹195.18 million rupees in January, complying with the October ruling of the Supreme Court.
On October 24, the superior court upheld the broader definition of AGR in the DoT and ordered telecommunications companies to pay levies based on that definition, along with interest on the principal amount and the penalty. The DoT calculates levies such as SUC and AGR-based license fees.
The court ordered 15 telecommunications companies, including those that have closed operations, to pay ₹1.47 trillion in AGR installments in three months. In subsequent hearings, the court rejected the fees based on the telecommunications companies’ self-assessment, saying the DoT’s calculations were final.
For Bharti Airtel, the DoT estimate stands at ₹Rs 43,780 crore, but according to the self-assessment of telecom companies, it should ₹13,004 crore for the DoT. The telecommunications company has already paid this amount together with a ₹5000 crore in ad-hoc payments.
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