The telecom industry association called the petition ‘motivated’ and with ‘mala fide interest’.

PIL filed against DoT in SC for not taking coercive action against telcos on AGR duesImage source: picxy.com/rajastills
Money Telecom Monday, January 27, 2020 - 18:12

Ahead of the Supreme Court hearing this week on the telecom operators' plea on their adjusted gross revenue (AGR) outstandings, a consumer forum called Save Consumer Rights Foundation filed a Public Interest Litigation with the Supreme Court, which sought action against the Department of Telecommunications.

Following this news, the shares of Vodafone Idea fell 2.2%, while the stock of Bharti Airtel was down by nearly 1% on Monday on the Bombay Stock Exchange.

The PIL sought action against an order by the DoT which said that no coercive action will be taken against service providers for missing the January 23 deadline to file their AGR dues. 

COAI director Rajan Mathews told ET: “This appears to be motivated from sources that have no interest in looking to solve a problem whose solution would benefit the industry, citizens and the country”.

The telecom industry association called the petition ‘motivated’ and with ‘mala fide interest’.

Vodafone Idea, Bharti Airtel and Tata Teleservices Ltd jointly filed a modification application in the Supreme Court on Monday, seeking more time to pay their AGR dues to the government which stands at Rs 1.02 lakh crore. The companies have asked the court to figure out a payment plan with the DoT, as having to pay the amount upfront could leave the industry in a precarious position and in a possible duopoly. 

The petition stated that the DoT’s decision not to pursue coercive action is a “gross violation of Article 141 of the Constitution (and) transgresses the Fundamental right to life of the Indian Citizens”.

The petition stated that dues were public money, which the companies wilfully disobeyed by not paying, and added that it causes a “huge loss to the public exchequer, which would directly affect the economic rights of the public at large”.

Sources, however, told IANS that the DoT is readying the payment schedule for the telecom companies whereby they may have to pay the principal and penalty amounts immediately. Though this standby payment plan is being readied, everything, however, depends on the apex court decision, the sources added.

They are expected to present a definite payment plan for the court's consideration and the DoT is expected to respond according to the court decision.

"DoT is waiting for the Supreme Court hearing and its directions next week. But at the same time it has made a roadmap as well, that if the honorable court allows telcos to negotiate with the government on the AGR payment schedule, DoT may ask them to clear the principal and penalty amount immediately and interest amount can be given over the next few weeks, as decided," an official said.

This payment schedule will be staggered over a six-month period, while the schedule only be finalised after the Supreme Court decision next week, the source added.

This news is bound to dash the hopes of operators like Airtel or Vodafone Idea who are hoping that the government spreads out the AGR due payments over a long period between 10-20 years.

The penalty and interest amount forms 80% of the total individual dues.

The total AGR dues of Airtel are Rs 35,500 crore. Airtel had said that as of September 30, it has provisioned for Rs 34,260 crore as liabilities from AGR that comprise the principal of Rs 8,747 crore, interest of Rs 15,446 crore, penalty of Rs 3,760 crore and interest on penalty of Rs 6,307 crore.

Vodafone Idea faces an AGR due of Rs 53,038 crore, including Rs 24,729 crore as spectrum usage charges (SUC), and Rs 28,309 crore towards licence fees. The company's board recently approved modifications in the use of their Rs 25,000-crore rights issue proceeds to pay Rs 2,826.1 crore towards the AGR dues.

Airtel has raised $3 billion through equity and debt funds from investors for paying AGR dues.

With IANS inputs

Become a TNM Member for just Rs 999!
You can also support us with a one-time payment.