SC Refuses to Rethink AGR Dues, Bad News for Financially Strapped Telcos

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SCOne of the heaviest financial burdens which the telecom companies in India face right now includes the Adjusted Gross Revenue (AGR). The Department of Telecommunications (DoT), after winning the fifteen-year long legal battle, had slapped these charges on the telecom companies. The older telecom companies now stand on the edge with regards to these dues as they are the ones to shoulder this burden. Bharti Airtel, Vodafone Idea, and Tata Teleservices were requested to pay amounts to the tune of Rs 91,000 crore in total in the beginning. However, these telecom companies have been opposing the AGR dues in every way possible. In the last cry for help, these companies had approached the Supreme Court, filing a plea for the recalculation of the dues.

Supreme Court Does not Budge From Its Decision

The result of the Supreme Court hearing, however, did not turn in favour of the telecom companies. All three Vodafone Idea, Bharti Airtel, and Tata Teleservices pleas were rejected by the Supreme Court. This order, which was passed on Friday, as per an ET Telecom report, said that there is no scope for recalculation of the AGR dues.

The recent Supreme Court ruling also highlighted and referenced the judgment passed last year in the same matter in the month of July. The three judges bench consisting of Justice LN Rao said that in the previous attempt as well, these telecom companies had requested for a recalculation of the dues, and during that time as well, their plea was rejected outright. The Supreme Court maintains the same stance in the matter for now. This means that the dues that these telecom companies have to pay remain in the same quantum.

Vodafone Idea Hardest Hit

On the other hand, if the plea had gone the telcos’ way, then the previous order would have had to be struck down. The AGR dues which plague the balance sheet of Vodafone Idea, Bharti Airtel, and Tata Teleservices amount to a total of Rs 1.19 lakh crore at present which are to be paid in a period of ten years. Out of this amount, approximately Rs 30,000 crore has already been paid by the telecom companies. Out of all, Vodafone Idea is the hardest hit, and this is the reason why it plans to raise around Rs 24,000 crore to pay off its AGR dues along with others.

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Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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