SC allows govt to review Vodafone Idea AGR dues
New Delhi, Oct. 28 -- In a big relief for Vodafone Idea Ltd, the Supreme Court on Monday allowed the government to address the grievances of the beleaguered telecom operator without the court's intervention, and reassess the demand for adjusted gross revenue (AGR) dues.
The bench of Chief Justice B.R. Gavai and Justice K. Vinod Chandran observed that the decision on any relief to the telecom operator is a policy matter.
The matter pertains to Vodafone Idea filing a petition last month challenging the Department of Telecommunications's (DoT) demand for an additional Rs.9,450 crore towards AGR dues.
India's third-largest telecom operator has also sought a waiver of interest and penalties on its dues, arguing that the disputed components of the dues have not yet been finalised.
Shares of Vodafone Idea rose as much as 10% on the National Stock Exchange following the news. It closed 4.16% higher at Rs.10.02. after rising as much as 10% during the day following the news. Shares of its peer Bharti Airtel also gained 2.65% and closed at Rs.2,083.
On Monday, solicitor general Tushar Mehta handed over a proposal to the bench, noting that the Centre already holds a 49% stake in the company and may consider additional measures to support it.
"Taking into consideration the change in circumstances that now the government itself has a substantial equity in the petitioner company, and further that the issue involved is likely to have a direct bearing on the interest of 20 crore (200 million) consumers, this is a matter within the policy domain of the Union," the court said in its order.
"If the Union, in the particular facts and circumstances, decides to take a view, there would be no reason why it should be prevented from doing so. We dispose of the petitions with these observations," the court added.
The bench, however, clarified that its order is restricted to the facts and circumstances of this particular case
During the hearing, Mehta said, "There are 20 crore consumers. that was one of the major reasons why the government took this decision. Because if this company is to suffer anything, apart from the lack of competition, it would lead to several issues for the consumers."
Senior advocate Mukul Rohatgi, appearing for Vodafone Idea, expressed satisfaction with the government's approach. "Yes, he (Tushar Mehta) takes care of my concerns-namely, that the government will now have a look at all our grievances. Then it should be okay," Rohatgi said.
"We look forward to working closely with the department of telecommunications to resolve this matter in the interests of our nearly 200 million subscribers," Vodafone Idea said in an exchange filing. "This is an impetus to the Digital India vision," it said.
The Supreme Court had, in 2020, locked Vodafone Idea's AGR dues till 2016-17 based on DoT's calculations, adding that no self-assessment or re-assessment of the dues would be permitted. However, DoT has now sought additional payments for up to 2018-19, Vodafone Idea stated in its petition filed on 8 September.
Of the fresh Rs.9,450-crore dues sought, the additional demand raised by DoT from Idea Group and Vodafone Idea (post-merger in August 2018) was Rs.2,774 crore, while the demand against Vodafone Group (pre-merger) was Rs.6,675 crore, according to the petition.
The department informed the telecom operator that the licence fee dues were calculated with interest and interest on penalty up to October 2019, and were updated up to 31 March 2025, with interest calculated at an annual rate of 8%.
On 19 September, the Supreme Court deferred the hearing to 26 September, but the government sought more time. The case was then deferred to 6 October and 13 October thereafter....
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