AGR Dues case had another hearing today. In the previous hearing, Kapil Sibal for Bharti Airtel said that the telco has paid all the AGR dues in respect of spectrum trading worth Rs 18,004 crore implying that it has no additional dues relating to spectrum trading. One of the main arguments that Ranjit Kumar representing COC for Aircel put forth SC was that the tripartite agreement recognises that spectrum should be treated as security before banks. Kumar made a point that when SC says that spectrum or the right to use it can’t be sold, then the apex court is pushing the insolvent companies in the direction of liquidation.
Will Bharti Airtel Pay the Dues of Videocon?
SC started the hearing by saying that as per spectrum trading guidelines, all the remaining dues must be paid before the transfer takes place. Since Bharti Airtel acquired the spectrum of Videocon and Videocon is not paying, Bharti Airtel will have to pay. Videocon RP had said that the company is not liable to pay anything beyond the CIRP process. Videocon will address AGR dues are operational dues only and waterfall mechanism as per IBC will have to be followed. With this Videocon RP concluded arguments.
To the statement made by SC, Kapil Sibal for Bharti Airtel replied that the telco has not received any notice from the government for paying any additional dues. Harish Salve for Jio said the same thing. Salve also for RCom COC said that the telco recognises spectrum as an asset of the company and not allowing the sale of it won’t help anyone. DoT, in NCLT is challenging this statement and saying that spectrum can’t be sold.
Salve also told SC that if the sale of spectrum is not allowed and the spectrum is auctioned by DoT, then too AGR dues won’t be paid. Salve said that the issue of sale of the spectrum should be left with NCLT. Before the court was adjourned until August 24, 2020, Kapil Sibal made a statement that the spectrum is recognised as an asset. If the SC says spectrum is not an asset of the telcos, then it will hurt the telecom sector at the end of the day since no bank would give the telcos a loan against spectrum security anymore.