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The Supreme Court delivered its verdict in the matter pertaining to the repayment of adjusted gross revenue (AGR) dues by telecom companies on September 1. The bench of Justices Arun Mishra, S Abdul Nazeer and MR Shah allowed a 10-year timeline for payment of AGR dues by telecom companies, will begin from April 1, 2021. The companies are required to make an upfront payment of 10 percent of the dues. The date fixed for annual instalment of AGR dues by telecom companies is February 7, the SC said. The SC clarified that there will be no revaluation of the dues.
The SC had in October 2019 upheld the expanded definition of AGR as given by the DoT, which placed a demand of over Rs 1 lakh crore on telecom companies.
Thank you for tuning into our live coverage of the Supreme Court’s AGR verdict. Stay tuned to Moneycontrol for more news, views and updates!
Experts say this is good for telecom companies even though the period of 10 years is lesser than the expected of 15-20 years.They say the verdict could work in favour of Reliance Jio and Bharti Airtel, but might be a matter of survival for Vodafone Idea.
The news may not be good for Vodafone Idea, who along with Bharti Airtel had sought for 15 years to repay the amount. While Bharti Airtel may not be affected much by the judgement, Vodafone Idea with its stretched balance sheet mayfind it difficult to survive.
As per Bharti Airtel’s assessment, it owes Rs 13,004 crore to DoTwhich it has already paid along with Rs 5,000 crore in ad-hoc payment. DoT, however, has assessed Bharti’s dues at Rs 43,780 crore.
SC has given 10 years against our demand of 15 years, 10 years is not bad. Too early to talk about a review petition. One needs to understand the judgment: Senior advocate Mukul Rohatgi, counsel for Vodafone Idea, to CNBC-TV18
As per the DoT assessment, total amount was Rs 1.19 lakh crore — Vodafone Idea owed Rs 58,254 crore, Bharti Airtel Rs 43,989 crore and Tata Teleservices owed Rs 16,798 crore to the government.
A relief for telecom companies? 🗼📱#SupremeCourt #AGRVerdict #AGRHearing #AGRDues #AGR #Telecom https://t.co/WFKMXrJZuo
— moneycontrol (@moneycontrolcom) September 1, 2020
No doubt that there will be review andcurative. SpectrumUsage Charge (SUC) doesnot constitute AGR and this is ajurisdictional question: Senior advocate Abhishek Manu Singhvi, counsel For Bharti Airtel, to CNBC-TV18.
Bharti Airtelrallied 5.5 percent to Rs 542.40 andReliance Communicationsgained 3.32 percent at Rs 2.49, whereasVodafone Ideaplunged 14.92 percent to Rs 8.67on the BSE at 12:03 hours IST.
Telecom stocks trade mixed after AGR verdict. Bharti Airtel, RCom rally, while Vodafone Idea tanks 15 percent
The date fixed for annual installment of AGR dues by telecom companies is February 7, the SC said.Existing bank guarantee given to be kept alive and Managing Director to give the undertaking to comply with the schedule.
Government was willing to give 20 years but SC said 10. Each company will decide if they want to file a review petition: Senior advocate Kapil Sibal, who had represented Bharti Airtel, to CNBC-TV18.
