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SC refuses plea of Vodafone Idea, Bharti Airtel, Tata Teleservices to re-calculate outstanding AGR, demanded by DoT

In September last year, the Supreme Court had given the telecom service providers time of 10 years to pay ₹ 93,520 crore of AGR-related dues to clear their outstanding amount to the government.

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The Supreme Court on Friday dismissed the petition of telecom companies, refusing to re-calculate the outstanding Adjusted Gross Revenue (AGR)  dues demanded by the Department of Telecommunications (DoT).

The Special Bench of Justices L. Nageswara Rao, S. Abdul Nazeer and M.R. Shah pronounced the order.

On July 19, the Supreme Court had reserved its verdict on the petitions of Vodafone Idea, Bharti Airtel and Tata Teleservices.

In September last year, the apex court had given the telecom service providers time of 10 years to pay ₹ 93,520 crore of AGR-related dues to clear their outstanding amount to the government. The top court of the country had said that telecom companies will have to pay the amount fixed by the government as AGR.

The Supreme Court had said that the companies do not want to pay the AGR amount, so they are declaring themselves insolvent. According to the data, Rs 1.47 lakh crore is outstanding under AGR. In which Vodafone Idea has to deposit Rs 50,399 crore and Bharti Airtel Rs 25,976 crore.

In their petition filed before the Supreme Court, the telecom companies contended that AGR dues have been calculated incorrectly. The companies have filed an application in the Supreme Court, seeking re-calculation for AGR.

According to the petition, the government has wrongly added license fee, spectrum usage charges at many places. Moreover , the government has added many bills twice.

The Department of Telecom is calculating the AGR on total income of telecom companies. In which the profit of companies as well as the profit earned on property sale and deposit interest are also included.

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The same telecom companies want to consider only the income on services as part of AGR. These companies have demanded that their total profit should be considered as part of AGR. They argue that non-core business like rent or income from sale of handsets or roaming charges should not be included in the revenue, of which they pay a percentage – they want to pay only on revenue earned from their core business.

AGR is the licensing and usage fee charged by the DoT from telecom companies. Apart from this, it also includes spectrum usage charges (between 3 and 5 per cent) and licensing fees, which is eight percent of the total profit. This is considered as part of AGR.
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