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Top Court Rejects Telecom Firms Plea For Review On Rs 92,000 Crore Dues

In a major setback for mobile service providers, the Supreme Court on Thursday rejected telecom companies’ plea seeking a review of its earlier order that allowed the government to collect dues worth Rs 92,000 crore from them. Telecom companies including Bharti Airtel and Vodafone Idea had moved a review petition in Supreme Court after the top court last year allowed the Department of Telecommunications (DoT) to collect the bulk of dues from them, giving the mobile operators three months to comply with the order.

Here are 10 things to know:

  1. Thursday’s development comes amid cut-throat competition in the country’s telecom sector, with companies reeling under thousands of crores of debt. 

  2. In October, the Supreme Court had upheld the telecom department’s demand that wireless carriers pay Rs 92,000 crore in overdue levies and interest, a decision that threatens the survival of Vodafone Idea.

  3. The Supreme Court had set a January 23 deadline for telecom operators to clear their dues with the telecom department. 

  4. The telecom department has claimed dues of around Rs 92,000 crore as license fee and Rs 41,000 crore as spectrum usage fee from Bharti Airtel, Vodafone Idea and Reliance Communications (RCom).

  5. According to the telecom department, Bharti Airtel owes around Rs 23,000 crore, Vodafone Idea Rs 19,823.71 crore and Reliance Communications Rs 16,456.47 crore.

  6. Reliance Communications, which shut down voice operations in December 2017, filed for bankruptcy last year.

  7. The payment dispute centres around the definition of adjusted gross revenue. In its October ruling, the top court upheld the telecom department’s definition of AGR. 

  8. Telecom providers in the country pay the Department of Telecommunications 3-5 per cent of their AGR in spectrum usage charges and 8 per cent as licence fees.

  9. Companies have long argued that AGR should comprise just revenue accrued from core services, while the government says it should include all revenue.

  10. Vodafone has said unless the government offered relief, or a legal remedy was found, it would not be able to continue its business in India. 

Source: NDTV Profit