Govt to study SC order before taking call on Vi dues: Jyotiraditya Scindia

Officials say Vi has to formally apply for relief

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The government will study the Supreme Court’s (SC) order on Vodafone Idea’s (Vi) plea to reassess adjusted gross revenue (AGR) dues and examine its implications before deciding on a policy decision, Telecom Minister Jyotiraditya Scindia said on Wednesday.

 

“We will need to study the order to understand its implications… we’ll wait for Vodafone Idea to apply to seek relief,” Scindia said on the sidelines of a briefing on department of posts.

 

Officials in the know said that Vodafone Idea will have to formally ask for the kind of relief it wants but the extent of the relief and the course of action will depend on the apex court’s order. They added that the details of the SC’s judgement will hold the key to enabling the government to proceed, while deliberations between the third largest carrier and the government, which has a 49 per cent stake in the carrier, will be crucial.

 

According to the details of the order, issued on Wednesday evening, the Supreme Court has allowed the government to reassess Vi’s AGR dues applied to the additional demands raised for the period up to FY 2016-17, and that it was limited only to the company.

 

The court noted that “in the peculiar facts of this case we find that there shall be no impediment in the Union of India reconsidering the issue and taking an appropriate decision in accordance with law,” and that the matter fell “within the policy domain of the Union of India and if, in the peculiar facts and circumstances of the case, the Union of India, keeping in view the larger public interest, desires to reconsider the issue, there is no reason to restrain or prevent it from doing so.”

 

However, the order also said, “It is further to be noted that the prayer in the petition itself restricts its claim only to the additional AGR demand raised by the respondent for the period up to the financial year 2016-17.” Business Standard has reviewed a copy of the order.

 

The order was in response to Vi’s petition against DoT that sought for quashing of additional demand of ₹9,450 crore raised by the Centre, of which ₹5,606 crore related to the period till 2016-17. Vi had sought for a comprehensive reassessment of its AGR dues for periods up to 2016-17, as well as a recalculation of liabilities. It had also sought a waiver of interest and penalties on the grounds that several components of the dues were not finalised. The telco currently owes ₹83,400 crore to the government in AGR dues.

 

Legal experts said that the order could limit the scope of relief to only the additional demands raised by DoT.

 

“The order is a welcome development as it provides clarity to the issue but it is restricted only to additional demands which Vodafone Idea has raised in its petition. The Court has allowed the government to relook at the AGR issue at a policy level, but that too is limited to the additional demands raised by DoT till FY16-17, as per the order. What relief the government can provide on AGR will have to be seen,” said Shally Bhasin, partner at law firm Shardul Amarchand Mangaldas & Co.

 

Others said that while the order was limited, it gave leeway to the government to take policy decision which would be in the interest of over 200 million consumers using Vi’s services.

 

“While the Court reaffirmed that the original AGR judgment stands final, it recognised the government’s discretion to revisit specific demands in light of its substantial equity stake in Vodafone Idea and the company’s systemic importance to consumers and the telecom sector. This nuanced approach balances judicial finality with policy flexibility—acknowledging that survival of a key operator and continuity of services are matters of public interest,” said Shiju PV, managing partner, IndiaLaw LLP.

 

“Recognising the government’s 49 per cent ownership in the company and the potential impact on over 20 crore subscribers, the Court rightly emphasised the public interest involved. By permitting a policy-level review, it has created scope for a balanced resolution that aligns with both legal compliance and economic stability in the telecom sector. This order is viewed as a positive development for the industry and the company alike. It opens the door for reassessment and potential relief from heavy financial burdens that have long hindered Vodafone Idea’s revival prospects,” said Zeeshan Farooqui, partner, King Stubb & Kasiva, Advocates and Attorneys.

 

He added that the Court’s stance supports the government’s efforts to sustain market competition, protect consumers, and safeguard public investment, thereby promoting a more stable and investor-friendly telecom environment.