The Supreme Court on Friday deferred to October 6 the hearing of telecom operator Vodafone Idea Ltd’s (VIL) plea challenging the Department of Telecommunications’ (DoT) additional adjusted gross revenue (AGR) demand of ₹5,606 crore for the financial year 2016–17.
A bench led by Chief Justice B R Gavai, along with Justices K Vinod Chandran and N V Anjaria, passed the order after Solicitor General Tushar Mehta, appearing for the Centre, requested that the case be listed post the Dussehra break. The bench accepted the request and adjourned the hearing.
VIL has urged the apex court to direct the DoT to “comprehensively re-assess and reconcile all AGR dues for the period up to FY 2016-17” in accordance with the Deduction Verification Guidelines issued on February 3, 2020. The fresh plea challenges the additional demand raised by the DoT despite the earlier finality accorded to AGR dues by the Supreme Court.
Earlier this year, the apex court had dismissed review petitions by VIL and Bharti Airtel seeking rectification of alleged errors and duplication in AGR calculations. The court had reaffirmed its 2021 order, which had already rejected similar pleas.
The Solicitor General submitted that the Centre, which holds nearly 50 per cent equity in Vodafone Idea, is a direct stakeholder in the company’s financial survival. “Some solution may have to be found out, subject to your lordship’s approval,” Mehta told the bench, seeking a short adjournment to explore a resolution.
The long-standing AGR dispute stems from the method of calculating telecom operators’ license fees and spectrum charges, which were earlier based on both telecom and non-telecom revenue. In October 2019, the Supreme Court upheld the DoT’s interpretation, leading to huge dues of ₹93,520 crore across the sector.
In September 2020, the apex court allowed a staggered payment schedule of 10 years, requiring telecom operators to pay 10 per cent of their total dues upfront by March 31, 2021, with the balance payable in annual instalments until March 2031. The court also made it clear that the DoT’s demands were final and could not be re-assessed.
In 2021, the government relaxed the AGR definition, excluding non-telecom income from its ambit, thereby reducing the future financial burden on operators.
The October 6 hearing will be crucial as it may determine whether Vodafone Idea can secure relief against the fresh ₹5,606-crore demand, even as the company continues to grapple with financial stress and high debt, with the government being one of its largest stakeholders.
