AGR: DoT seeks 20 years time for recovering dues from Telcos, moves Supreme Court for modification of its orders
Litigation News

AGR: DoT seeks 20 years time for recovering dues from Telcos, moves Supreme Court for modification of its orders

Shruti Mahajan

The Department of Telecommunications (DoT) has moved the Supreme Court for modification of its orders with respect to the deadline for telecom companies to pay Adjusted Gross Revenue (AGR) dues.

The division of the Union Ministry of Communicatons has sought a window of 20 years to recover these dues from the telcos.

In its October 2019 judgment passed by the Bench headed by Justice Arun Mishra, the Supreme Court had granted the telecom companies a period of 90 days to pay the dues in view of the new meaning attributed to Adjusted Gross Revenue.

This period of ninety days was scheduled to lapse on January 24. After the companies approached the Supreme Court seeking a modification of its order, the deadline was extended till March 17 by the Court in its order passed on February 14.

Now, the DoT has moved the Apex Court seeking an extension of the window to recover AGR dues from telcos over a period of twenty years, citing adverse impact on the telecom and banking sectors.

"It requires to be brought to the notice and kind consideration of this Hon'ble Court that considering the huge amount which is payable by the telecom service providers, there would be certain inevitable consequences which may not be in any ones' interests."
DOT's application states

The application goes on to highlight that the telecom companies have begun to make their part payments. These service providers cater to crores of consumers in the country and an immediate adverse impact on the functioning of these telcos will not only affect these consumers, but will also have a massive effect on the overall economy of the country, it is stated.

Should any of the major players in the telecom industry be impacted adversely on account of this order, it would have wide consequences including impact on consumers, competition within the industry, quality of telecom service, and implications on the Banking sector, the application contends.

The DoT has also sought for telecom companies not to be charged penalties, interests on penalties, and principal beyond the date of the judgment.

After due consideration and deliberation, a formula is arrived at for the recovery of dues by the DoT and the same has now been placed before the Apex Court for its approval.

The DoT says that this formula has arrived at keeping in view "vital issues relating to financial health and viability of the telecom sector and need for maintaining competition and level playing field in the interest of consumers."

The proposed plan placed before the Court stipulates the payment of dues by telecom companies and other licence holders affected by the judgment in annual installments over twenty years. It also seeks that payment owed to the government be protected by a levy of 8% interest.

Solicitor General Tushar Mehta mentioned the matter for hearing before the Bench of Justices Arun Mishra and MR Shah given that the matter was scheduled to be listed for hearing on Tuesday, March 17.

AGR: DoT seeks 20 years time for recovering dues from Telcos, moves Supreme Court for modification of its orders

Noting that the Supreme Court is functioning in a restricted capacity for hearing only urgent matters, Justice Mishra said that it is unclear when the Bench that passed the AGR order will assemble again.

The matter, however, will be heard by the same Bench that passed the order, the Court said.

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