AGR dues: Evaluation of telcos self-assessment may take 6 months, says DoT

The financially stressed telecom industry could get a breather as the government has indicated that it would take at least six months to evaluate the companies’ self-assessment of dues linked to adjusted gross revenue (AGR). So far, telcos including Bharti Airtel, Vodafone Idea and Tata Teleservices have assessed their dues as a fraction of what the government had estimated.       
 

According to an official with the Department of Telecommunications (DoT), numerous documents for multiple years have to be evaluated and cross-checked, making it a lengthy process.

After telcos had made part payment of the dues recently, the government, last week, asked them to settle the AGR bill fully without further delay. In October 2019, the Supreme Court had asked telecom operators to pay up their pending licence fees and spectrum usage charges along with penalties and interest, while upholding the DoT definition of AGR. The total dues for the telecom industry was estimated at Rs 1.47 trillion. The DoT had written to all telcos asking them to pay the balance dues “without delay” and submit detailed bifurcation of payments (explanation of self-assessed amounts), which it said was necessary for proper reconciliation of legitimate AGR dues.

On whether the evaluation exercise would be conducted by the DoT or the Comptroller and Auditor General of India (CAG), the official said, “CAG has done a detailed audit from 2006-07 to 2014-15 of the AGR dues. This evaluation will be done by us, for all the firms, all the quarters and all the 22 circles. ” In all, 16 entities owed the government an estimated Rs 1.47 trillion in AGR liabilities — Rs 92,642 crore in licence fee and another Rs 55,054 crore in outstanding spectrum usage charges. Of the dues that include interest and penalty for late payments, Airtel and Vodafone Idea accounted for 60 per cent. The Supreme Court last month rejected a plea by Airtel and Vodafone Idea for extension in the payment schedule and asked firms to deposit their past dues for spectrum and licences.

Vodafone Idea pegged its total dues to the government at Rs 21,533 crore — less than half of what the DoT had estimated at more than Rs 50,000 crore. The company has so far paid Rs 3,500 crore out of the “self-assessed” liability of Rs 21,533 crore.

On a similar self-assessment pattern, Airtel paid Rs 13,004 crore to the government in two instalments, while depositing an additional Rs 5,000 crore as an adhoc payment to cover any reconciliation differences. 

According to the government estimates, it owed Rs 35,500 crore in AGR dues to the government. Similarly, Tata Teleservices paid Rs 2,197 crore in AGR dues, followed by an additional Rs 2,000 crore to cover reconciliation differences, against DoT expectation of Rs 14,000 crore.