Desk
Share
On 23 July 2021, the Supreme Court dismissed the petition related to Adjusted Gross Revenue (AGR) filed by Vodafone Idea and Bharti Airtel. These companies claimed that the Department of Telecommunications had made mistakes in calculating their outstanding AGR, and they were demanding rectification.
What is AGR?
AGR is the amount that telecom companies have to pay to the government as usage and licensing fees. It is divided into two parts: spectrum usage charges and licensing fees, which are 3-5% and 8% respectively. The Department of Telecommunications says that AGR should be calculated based on the entire income of a company, which should include income from various sources. On the other hand, telecom companies argue that it should be calculated only based on income from telecom services.
What is the legal dispute?
This dispute started in 2005, when the Cellular Operators Association of India (COAI) challenged the government rules for calculating AGR. In this case, the Telecom Dispute Settlement and Appellate Tribunal (TDSAT) recognized the government's side, and included all types of income in AGR. After this, telecom companies challenged this decision in the Supreme Court.
issue of the outstanding balance
After the Supreme Court's decision, the companies had to pay the outstanding amount of about Rs 1.47 lakh crore along with interest and penalty. However, later the Department of Telecommunications admitted that there were mistakes in the calculation of AGR and it needs to be corrected.
Disposal of review petition
Recently, Vodafone Idea filed a review petition against the Supreme Court's decision in the AGR case, which was again rejected by the Supreme Court. This decision may further increase the crisis situation of Vodafone Idea and other telecom companies.
It is worth noting that this decision of the Supreme Court can prove to be a turning point not only for Vodafone Idea but for the entire telecom industry. This legal battle going on over the AGR issue can have a profound impact on the future of telecom companies and the stability of the Indian telecom sector.
