AGR Dues Case Hearing at Supreme Court from Today

Today, the Supreme Court will again hear the AGR dues case between the telecom department and the telcos. The main case stands settled and the telcos are paying their AGR dues, however, this hearing comes as the telco feel there has been a calculation error and want reevaluation of the same.

AGR Dues Case Hearing Today

This January, Bharti Airtel, Vodafone Idea and Tata Telecommunications moved Supreme Court to challenge the AGR dues that the DoT had estimated. The telcos have sought a reassessment of the same, as they believe that the dues have been miscalculated. However, the apex court has already rejected the telcos' self-assessment once before. That means that this time around, it is an uphill battle for Airtel, Vi and Tata. Back then, SC had said that the telcos need to pay the dues by March 31,  2031.

The telcos involved in the case have all have their self-assessed AGR dues, which are miles behind what DoT expects. In case of Vodafone Idea, the dues stand at ₹58,400 crores, per DoT calculations. The telco, on the other hand, says that its own calculation cuts the dues by almost 60% to ₹21,533 crores. Out of that, it has already paid a third, that is, ₹7,854 crores.

Similarly, for Bharti Airtel, the telecom department calculated ₹43,980 crores, which the telco has said stands at ₹13,004 crores. What's more, the telco has already paid around ₹18,000 crores in dues payments. Tata Telecom's predicament is similar to Airtel's; DoT has told it to paid ₹16,798 crores, the telco calculates the same at ₹2,197 crores, and it has already paid almost double that amount.

How Important is the AGR Dues Case?

The telecom industry has some well-documented financial issues. Particularly, Vodafone Idea; their financial struggles have been all the more publicized given their substantial dues. The telco had already written to the DoT seeking aid and a moratorium. The telco's plans to raise around ₹25,000 crores have taken a hit due to poor sector health.

If the SC takes a favorable view on the matter, the telecom industry might come out better on the other end. First, Vodafone Idea will find it easier to raise the $3 billion it is about to, from Apollo Global. What's more, it saves Bharti Airtel a lot of funds, which it can use to expand its 4G network and prepare for 5G.

CLSA estimates that the total money that the telcos might save will be around $4-5 billion, which will significantly improve the sector health as a whole.