The Supreme Court on Thursday has directed the Department of Telecommunications to consider payment proposals by telecom companies who must furnish their books of accounts and balance sheets of last 10 years to show their financial capacity.
A three judge Bench of Justices Arun Mishra, Abdul Nazeer and MR Shah was hearing a plea of the Department of Telecommunications seeking NV staggered payment of AGR Dues by Telecom companies.
During the hearing today, the Court was informed that the Department of Telecommunications has decided to withdraw 96 per cent of the Rs 4 lakh crore demand raised against non-telecom PSU’s based on the Supreme Court’s October 2019 verdict that had altered the definition of Adjusted Gross Revenue (AGR).
Solicitor General Tushar Mehta stated that an affidavit has been filed explaining why AGR dues were raised against PSUs and 96% of Rs 4 lakh crore bill has been withdrawn. He also informed the Court that while the Telecom Companies have filed their response, the Department of Telecommunications needs some more time to file their response.
Senior Advocate Mukul Rohatgi appearing on behalf of Vodafone, submitted that the company’s position is extremely precarious and it is not in a position to give any fresh bank guarantee. It has already paid Rs 7,000 crore to the DoT. Over Rs 10,000 crore of bank guarantees are lying with the DOT, which should be considered as security. According to Rohatgi, payment of all the AGR can only be made through instalments over 20 years since the company can only earn and pay.
The bench responded to Rohatgi’s submission stating that Vodafone was a larger foreign player, and some amount must be deposited especially when during the pandemic the government needs this money.
Senior Advocate Arvind Datar on behalf of Tata Teleservices, informed the Court that Rs 37000 crores have been paid, and the company has been hit by the pandemic.
Senior Advocate Dr AM Singhvi, appearing for the third telco Bharti Airtel, and informed that 18,000 crores out of over 21000 crores have been paid and bank Guarantees of Rs 10,800 crore is pending with the DOT.
The Supreme Court in its hearing last Thursday had directed the Department of Telecommunication to reconsider the claims raised on Public Sector Undertakings based on SC’s October 19 verdict regarding the telecom companies and their AGR dues, stating that the Court’s judgement could not be the basis for demands on PSUs.
The telecom companies were also asked to file affidavits regarding the time that they need to clear their dues. According to the Court, raising demand on PSUs based on verdict for AGR wasn’t required since licenses of PSUs and telcos are of different nature, and PSUs don’t intend commercial exploitation.
The Department of Telecommunications moved an application before the Apex Court seeking permission to pay their AGR dues of 1.43 lakh crore according to the verdict, in a staggered manner over the time period of 20 years.
The Apex Court in April had already rejected pleas of the three telcos including Vodafone Idea, Bharti Airtel and Tata Teleservices seeking review of the October 2019 verdict of the Supreme Court that had widened the definition of AGR and directed the telcos to pay their dues.
-India Legal Bureau