Don't take action against telcos on AGR: TDSAT to DoT

The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) today asked the government not to force operators to pay licence fees in accordance with the recent Supreme Court order till January 31, 2012, the next date of hearing in the dispute between telcos and the Department of Telecommunications (DoT) over components of adjusted gross revenue (AGR).

During the proceedings, counsel appearing for the DoT informed the tribunal that it was in the process of making a revised demand for AGR from companies as per the directions of the Supreme Court.

Counsels appearing for leading operators requested the TDSAT to adjourn the matter as they may challenge the revised AGR bills before the tribunal.

This was accepted by the TDSAT bench headed by Justice SB Sinha and adjourned the matter to January 31.

He said "original dues and revised dues should not be enforced by the respondent [DoT]" till next date of hearing.

The tribunal was hearing the dispute over the components of the AGR between telecom operators and DoT. According to the the Supreme Court's direction, the tribunal has to decide afresh the issue of what constitutes components of adjusted gross revenue for calculating licence fee and issued notice to the government in this regard.

There are differences over what constitutes AGR on which annual licence fee be charged. Service providers say that income from telecom services only (excluding other income like interest on savings, dividends, bundling of handsets and others) should not be considered for the purpose.

On the other hand, the DoT takes total income of the firm as an AGR.

The TDSAT is hearing the matter on the direction of the Supreme Court which on October 11 set aside Tribunal's order and asked it to decide the issue of AGR and to "pass fresh orders in accordance with law".

The TDSAT on August 30, 2007, had ruled that income from dividend, interest income on savings, capital gains, management consultancy and training as well as gains from foreign exchange should not be part of AGR for paying revenue share or license fee to the government.

This was challenged by the government before the Supreme Court.