Nearly five months after winning its legal battle in the Supreme Court against telecom majors including Vodafone and Bharti Airtel for payment of Adjusted Gross Revenue (AGR) dues worth several lakhs of crores of rupees, the Centre did a virtual U-turn on Monday by urging the court to give the companies a 20-year window to pay the money back.
In an application mentioned for urgent hearing in the apex court, the government said it has, after “detailed and long-drawn deliberations”, devised a “formula” to soften the blow of the October 24, 2019 judgment directing the companies to cough up the AGR in three months.
Also read: AGR dues: Bharti Airtel pays ₹3,004 crore as full and final settlement
Staggered instalments
“All the licensees impacted by the judgment be allowed to pay the unpaid or remaining amount of past DoT assessed/calculated dues in annual instalments over 20 years (or less if they so opt), duly protecting the net present value of the said dues using a discount rate of 8% (based on one year marginal cost of lending rate of SBI which is currently 7.75%),” the application said.
A document annexed to the application shows that the total demand of the Department of Telecommunications (DoT) as in October 2019 was ₹1,69,048.65 crore from 16 major telecom service providers (TSPs). The payment received till March 6, 2020, from these companies was ₹25,901.56 crore. Dues to the tune of ₹1,43,271.74 crore remain outstanding.
Also read: Airtel, Vodafone Idea to pay AGR dues on February 17
The application said the formula was crafted taking into consideration the “larger interest, economic consequences on the nation and with a view to ensure that the Supreme Court order is complied with in letter and spirit.” It said deliberations were held at various levels of the government in the administrative hierarchy, including the Cabinet.
The application said vital issues related to the financial health and viability of the telecom sector and need for maintaining competition and level playing field in the interest of consumers were considered.
It said the closure of one or more TSPs would adversely impact the digital connectivity of the country driving e-governance projects in commerce, banking and health. It would also dent the spread of digitisation in rural India.
