Power Grid Corp moves SC against DoT demand of Rs 22,000 cr in AGR dues

The company said its revenue from telecom business was only 2% of its turnover

State-run transmission utility Power Grid Corporation on Friday said it has filed an application before Supreme Court against Department of Telecom's demand of around Rs 22,000 crore in past dues, saying its revenue from telecom business was only 2 per cent of its turnover.

Following the October 24 Supreme Court ruling that non-telecom revenues of telecom firms such as Bharti Airtel and Vodafone Idea should be included for considering payments of government dues, the telecom department (DoT) sought additional license fee from non-telecom firms also.

The DoT had sought additional license fee of Rs 1.72 lakh crore from gas utility GAIL India Ltd, Rs 48,000 crore from OIL, around Rs 22,000 crore from Power Grid Corporation (PowerGrid), and has raised similar demands from RailTel and other public sector undertakings (PSUs).

"On 23rd January 2020, POWERGRID has filed an application before the Hon'ble Supreme Court for clarification/modification of its order on 24th October 2019 and next course of action will be based on the outcome of the application," PowerGrid said in a statement.

The company pointed out, "Non-Telecom revenue of Power Grid i.e. power transmission and its related consultancy business constitutes 98 per cent of revenue whereas revenue from telecom segment is only about 2 per cent."

It also claimed that PowerGrid is National Long distance (NLD) and Internet Service Provider (ISP) licensee and is regularly paying the applicable license fee on Adjusted Gross Revenue (AGR) to DoT in line with terms & conditions of respective license agreements and have also been assessed by DoT up to 2013-14.

The company said that DoT has done provisional assessments for 2014-15 to 2017-18 and also reassessed for 2012-13 and 2013-14 and raised additional demand to the tune of Rs 21,954 crore in the past one year by addition of non-telecom revenue as miscellaneous income in AGR.

PowerGrid has contested the demands before DoT and requested for its withdrawal, as the definition of AGR under NLD and ISP license agreements does not include such non-telecom revenue, it said.

Moreover, it said that the DoT recently completed the assessment of NLD and ISP licenses for 2018-19 without addition of miscellaneous income and in fact assessed a refund to PowerGrid.

The dispute, regarding interpretation of AGR pending before the Supreme Court, was between DoT and Telecom Service Operators (TSPs), who were holding Unified Access Service License (UASL) and migrated from National Telecom Policy (NTP)-1994 to NTP-1999, it said.

The recent judgment on October 24, 2019, of the Supreme Court, is not applicable/binding on PowerGrid as it was not licensee prior to 2001 and never held UASL, it added.

Further, it also said that the definition of AGR as per NLD and ISP license agreements as well as nature of limited telecom activity of PowerGrid is completely different and distinct from that relating to the TSPs, which were before the Supreme Court.