Abhijay Raj Vaish, Pune
The Supreme Court on Thursday dismissed the pleas filed by Bharti Airtel and Vodafone Idea about recalculating their Adjusted Gross Revenue (AGR) dues. The petitions were filed in relation to the top court’s judgment in 2019 that ruled for the payment of AGR dues amounting to Rs. 92,000 crore which added their non-telecom revenue to the spectrum charges that are due to the government. The appeal was made to reduce the telecom giants’ debt burden, especially Vodafone Idea, by reducing the load of Rs. 1.47 trillion owed to the government.
The telecom giants had argued for relief in light of the miscalculation of dues by the Department of Telecommunication (DoT). The SC rejected to hear the pleas made by both companies that led to Vodafone Idea’s shares hitting a 52-week-low falling by approximately 20 percent. However, Bharti Airtel stood firm in light of the ordeal and remained mostly unaffected in terms of their share prices which marginally rose by 1 percent.
The case was presented to a three-judge bench consisting of Chief Justice of India DY Chandrachud along with Justices BR Gavai and Sanjiv Khanna. The dispute over AGR have been underway since 2005 where the DoT has argued for it to include all revenue including the non-telecom income. The telecom operators, however, claim that the revenue should only contain the core telecom revenue of the company.
Both companies involved had earlier requested for extended time period to pay back the loans in 2019. In 2020, the apex court had granted leeway allowing them a 10-year period to pay the loans until 2031 post which they had argued for the calculation errors that led to this current judgment.
The judgment has further worsened the woes of Vodafone Idea pushing them on the verge of a financial crisis while also delaying their capex plans. The company had also planned to raise debt and bank guarantees to Rs. 35,000 crore with an AGR burden of around Rs. 70,000 crore at the end of Fiscal Year 2024 for which they had sought relief.