Supreme Court rejects telecom companies' plea to recalculate AGR Dues

In the midst of an ongoing disagreement over the payment of debts owed to the government, the Supreme Court on Wednesday denied telecom companies' request to recalculate their adjusted gross revenues, or AGRs. The businesses expressed worry about how the financial crisis will impact all businesses.

A corrective plea was filed by Vodafone India, Bharti Airtel, and other firms against the October 2019 ruling of the court, which ordered them to pay the government INR 92,000 crore within three months. The present petitions are directed against an order from September 2020 that stipulates that AGR dues must be paid over a ten-year period, with 10% of the amount due by 31st March of each year.

The telecom companies filed their case today, alleging that the Department of Telecommunications, made a serious mistake in computing the license fees and spectrum costs associated with those dues.

According to reports, the DoT has computed AGR dues that are in excess of INR 1 lakh crore. Of these, Airtel is estimated to owe INR 43,980 crore and Vodafone INR 58,254 crore. But according to the figures provided by the firms, Vodafone claimed to owe just INR 21,533 crore, while Airtel claimed to owe only INR 13,004 crore.

Chief Justice of India (CJI) Dhananjaya Y Chandrachud led a three-judge bench that issued a judgment dated 30th August  that was posted to the supreme court's website on Thursday. The bench stated, "We have gone through the Curative Petitions and the connected documents." No case, in our opinion, is made out within the bounds set forth in this Court's ruling in Rupa Ashok Hurra v. Ashok Hurra (2002). The 2002 ruling establishes the guidelines for considering a review or corrective petition against the ruling of the highest court in the event that there is a clear unfairness or evident mistake in the ruling. 

The court's 24 October, 2019, ruling in favour of the government, allowing DoT to include all non-telecom revenue in AGR calculations, was challenged in the curative petition.

The government receives funding for granting licenses and using spectrum, and revenue-sharing between telecom companies and the government is based on the computation of AGR.

The government's portion is determined by the DoT as a proportion of the AGR. This equates to eight percent for license payments and three to five percent for spectrum usage fees.