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Five telecom firms understated AGR by Rs 14,800 crore: CAG

Tata Tele, Telenor, Videocon, Quadrant and Jio figure on list

Kiran Rathee  |  New Delhi 

Five telecom firms understated AGR by Rs 14,800 cr: CAG

Tata Teleservices, Telenor, Videocon Telecom, Quadrant Televentures, and Infocomm have understated their adjusted gross revenue (AGR) by over Rs 14,800 crore, which has resulted in a shortfall of Rs 1,526.70 crore to the government, according to a report by the (CAG) of India.


The report, tabled in Parliament, states the interest on the short payment stood at Rs 1,052.13 crore for the period up to March 2016.

Mobile service operators are required to share a percentage of their AGR with the government as annual licence fee. Currently, operators pay eight per cent of their AGR as licence fee. In addition, telecom companies are required to pay spectrum usage charges for using air waves allotted to them.

The CAG findings are based on audits of and (Maharashtra) from 2010-11 to 2014-15; from 2006-07 to 2014-15; from 2009-10 to 2014-15; from 2009-10 to 2014-15; and Infocomm from 2012-13 to 2014-15.

The CAG had in June tabled a report on six other mobile service operators, Bharti Airtel, Vodafone, Idea Cellular, Aircel, Sistema Shyam Teleservices, and Reliance Communications. The six companies were found to have understated revenues by more than Rs 61,000 crore over five years, resulting in a short payment of nearly Rs 7,700 crore in statutory dues to the government.

Reacting to the CAG report, a spokesperson said, “The charge against is related to ‘revenue share on realised forex gain’. This is an industry issue and was referred to the Telecom Disputes Settlement and Appellate Tribunal (TDSAT), which ruled in favour of telecom operators. However, the decision was appealed against by the Department of Telecommunications (DoT) and this matter is sub judice in the Supreme Court.”

Sharing details of the five companies, the CAG said the government was paid Rs 1,015.17 crore less in licence fees, Rs 511.53 crore in spectrum usage charges, and Rs 1,052.13 crore as interest applicable on delays in payment.

The government collection from is short by Rs 1,893.6 crore, from by Rs 603.75 crore, from by Rs 48.08 crore, from by Rs 26.62 crore, and from by Rs 6.78 crore.

The CAG said the understatement of revenues was done through accounting adjustments for commissions or discounts paid to distributors, promotional schemes like free talk time and discounts to postpaid subscribers, and on roaming services.

There has been a difference of opinion between the CAG and mobile service operators on the definition of AGR and the issue has been in court on several occasions.

In May this year, the Tripura High Court had ruled that revenue earned by telecom operators from activities unrelated to their licence could not be included in the AGR. The court had also ruled that the DoT change the definition of AGR for working out the revenue share of telecom operators.


First Published: Wed, December 20 2017. 01:20 IST