AGR Dues: Centre Withdraws Most of Rs 4 Lakh Cr Demand From PSUs

Earlier, the apex court had called demanding Rs 4 lakh crore from state-run companies as AGR “totally impermissible”

2 min read
Vodafone Idea and Bharti Airtel. Image used for representational purposes.

The Central government on Thursday, 18 June, reportedly informed the Supreme Court that the Department of Telecommunications (DoT) had decided to withdraw 96% of the Rs 4 lakh crore demand for AGR-related dues raised against non-telecom PSUs.

Following the apex court’s 2019 verdict, DoT had sought payment of past dues from gas utility GAIL India Ltd, electricity transmission firm PowerGrid, Oil India Ltd, Delhi Metro and others.

The Supreme Court had on Thursday, 11 June, pulled up Centre for misinterpreting its previous verdict on Adjusted Gross Revenue (AGR) and demanding Rs 4 lakh crore from state-run companies as AGR as "totally impermissible".

A bench of Justices Arun Mishra, S Abdul Nazeer and M R Shah gave DoT time till the third week of July to respond to the affidavits filed by telecom companies, including Bharti Airtel and Vodafone Idea Ltd, on payment of AGR dues.

During the hearing, the bench reportedly asked about the security and guarantees which can be sought from telecom companies to ensure payment.

Senior advocate Mukul Rohatgi, appearing for Vodafone Idea, reportedly answered that it has already paid Rs 7,000 crore to the DoT, but presently keeping in mind the precarious financial condition, “it was not in a position to furnish any bank guarantee.”

The bench reportedly observed that during ongoing pandemic, telecom was the one sector that was making money and they should deposit dues with the government to aid it.

Senior Advocate AM Singhvi who's appearing for Bharti Airtel reportedly told the court that bank guarantees of Rs 10,800 crore was pending with the DoT, which could be encashed if Airtel defaulted on payments.

“Bharti Airtel's payment of AGR dues constitutes 70 percent of the total amount collected so far by DOT,” Singhvi told the court.

In March, the SC had lashed out at the Department of Telecom (DoT) and Indian telcos for seeking a 20-year period to pay their adjusted gross revenue (AGR) dues. The development had come as a big jolt to Vodafone Idea Limited (VIL) which has been in desperate need of a reprieve from the government as well as the Supreme Court in the matter.

(With inputs from PTI and CNBC TV18)

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