SC clarifies order allowing AGR dues re-examination to apply only to Vi

Supreme Court clarifies that its order allowing the Centre to re-examine AGR dues up to FY17 is limited to Vodafone Idea, ending ambiguity on inclusion of other telecom firms

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Even as other telecom companies are also hopeful of getting a breather, the written order of the latest Supreme Court verdict, linked to adjusted gross revenue (AGR) dues, suggests that the scope has not been broadened beyond Vodafone Idea (Vi).

 

In the written order copy uploaded on Tuesday, a two-judge Bench of Chief Justice of India Justice B R Gavai and Justice K Vinod Chandran said that the October 27 order passed by it would only change to the extent that the Centre would be allowed to re-examine the entire AGR dues of Vodafone Idea up to financial year 2016-17, instead of just the additional demand. “Rest of the order shall remain intact,” the two-judge bench said in the order copy.

 

The modified order is a sign of relief for the financially stressed telco, in which the government holds around 49 per cent stake.    

 

On October 27, the two-judge bench had said that the central government was free to reconsider Vodafone Idea’s plea to set aside the additional demand of Rs 9,450 crore raised by the Department of Telecommunications. On November 3, the apex court verbally modified its October 27 order, allowing the government to re-examine the entire adjusted gross revenue (AGR) dues of Vodafone Idea (Vi) up to the financial year 2016-17.

 

It was, however, unclear whether the order allowing the central government to re-examine AGR dues was limited to Vi or could extend to other telecom companies as well.

 

The issue stems from Vodafone Idea’s challenge to an additional AGR demand of Rs 9,450 crore raised by the DoT.

 

In its petition to the Supreme Court, Vodafone Idea had sought a comprehensive reassessment of its AGR dues and a recalculation of its liabilities, along with a waiver of interest and penalties, arguing that several components of the dues were not finalised.

 

This smaller demand raised by the DoT is part of the larger AGR issue, which the Supreme Court ruled on in 2020. In the judgment five years ago, the apex court had upheld the DoT’s calculation of the telco’s AGR dues up to 2016-17, ruling out any further recalculation. Vodafone Idea’s liabilities were pegged at Rs 58,254 crore at the time, a figure that has since risen to Rs 83,400 crore.