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In a relief to telecom services provider Vodafone Idea Ltd (Vi), the Supreme Court on Monday allowed the Central government to reconsider the demand for Adjusted Gross Revenue (AGR) dues of over Rs 5,000 crore.
A bench of Chief Justice of India B R Gavai and Justice Vinod Chandran noted the Centre’s submission of a change in circumstances as the government had infused 49 per cent into the group.
Vi had approached the top court contending that these were additional demands by the Department of Telecommunications for the 2016-17 period which were already settled by the SC and hence could not be reopened.
Appearing for the Centre, Solicitor General Tushar Mehta pointed out that given the government now had a 49 per cent share in the company which had 20 crore customers, it was inclined to reconsider the telco’s request in respect of the AGR dues.
Taking note, the SC said in its order, “The Solicitor General on instructions states that taking into consideration the change in circumstances, that is the Government of India acquiring 49% equity, and the larger aspect that 20 crore customers utilising the service of the petitioner, the Union is willing to examine the issues raised by the petitioner. It is further submitted that the government has agreed to reconsider it and take an appropriate decision, if the Court so permits… Taking into consideration the status of the case now, the government has infused substantial equity into the company, and further, that the issue involved is likely to have a direct bearing on the interests of 20 crore customers, we see no issue in the Union reconsidering the issue and taking an appropriate decision.”
Disposing of the writ petition, the court also made it clear that “this is a matter within the policy domain of the Union” and that “if the Union, in the peculiar facts and circumstances… in the larger interest, reconciles the issue, there is no reason as to why” it “should be prevented from doing, with that view of the matter, we dispose of the writ petition.”
The question of Adjusted Gross Revenue (AGR) dues payable by telecom companies to the government had been a point of dispute since 2003.
In 2011, the Supreme Court first ruled that the Telecom Regulatory Authority of India (TRAI) and Telecom Disputes Settlement & Appellate Tribunal (TDSAT) did not have the jurisdiction to exclude certain items of revenue included in AGR.
Upholding the Department of Telecommunication’s (DoT) stand on what constitutes AGR, the Supreme Court had on October 24, 2019 paved the way for recovery of AGR dues amounting to about Rs 1.6 lakh crore from telcos. Meanwhile, the Centre urged the court to allow telecom companies which pleaded financial difficulties to pay the dues over a 20 year period. By an order on September 1, 2020, the court allowed the companies to pay the same over a 10-year period, starting April 1, 2021.
On July 23, 2021, it dismissed all pleas by companies over arithmetic errors in the calculation of AGR. In May this year, the SC had rejected pleas by Vodafone Idea and two other companies seeking waiver of interest, penalty, and interest on penalty on their AGR dues.
