Airtel, Vodafone Idea and Tata Tele move SC to negotiate payments terms with DoT

The Supreme Court had rejected the telecom service providers' plea seeking a review of its AGR order that ordered them to pay Rs 92,000 crore to the government.
Airtel, Vodafone Idea and Tata Tele move SC to negotiate payments terms with DoT
Airtel, Vodafone Idea and Tata Tele move SC to negotiate payments terms with DoT
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Ahead of the January 23 deadline, Bharti Airtel, Vodafone Idea and Tata Teleservices have approached the Supreme Court seeking modification in its verdict in the Adjusted Gross Revenue (AGR) matter where they have sought court permission to negotiate with DoT on the payment schedule. The joint plea is likely to be heard on Tuesday.

A source said: "The companies are seeking more time from January 23" to pay and they want to request DoT to allow them make payments in a longer time period and for that they need court's permission".

The Supreme Court had rejected the telecom service providers' plea seeking a review of its earlier order that allowed the government to collect dues worth Rs 92,000 crore from them.

A modification petition can be heard in open court and the telecom companies are likely to argue for more time for making the payment to the telecom department.

According to the telecom department, Bharti Airtel owes around Rs 35,500 crore, Vodafone Idea Rs 44,200 crore and Reliance Communications Rs 16,456.47 crore.

Bharti Airtel has raised capital to meet the liability, but Vodafone Idea remains challenged. Airtel last week raised capital of US $3 billion, which should help it meet its AGR liability with the help of additional debt.

VIL promoters, Vodafone Plc and Aditya Birla Group, have already mentioned that if the entire AGR liability has to be paid, they will have to shut shop. 

"We don't see the situation for VIL being salvaged without government intervention. Apart from other stakeholders in VIL, the government too could be one of the most impacted parties if the company shuts down as it is owed Rs 900 billion in deferred spectrum dues, besides the AGR liability," ICICI Securities noted.

"We also see indirect impact on PSU banks if VIL fails to cough up the money", it noted.

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