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The Supreme Court on Tuesday asked Department of Telecommunication (DoT) not to invoke bank guarantee given by Bharti <keyword id="15491" type="General" weightage="20" keywordseo="airtel" source="Orion">Airtel</keyword> for a period of three weeks for not clearing Videocon Telecommunications Ltd's adjusted gross revenue (AGR) dues of over Rs 1,300 crore. A bench headed by Justices L. Nageswara Rao and comprising Justices S. Abdul Nazeer and M. R. Shah declined to entertain Airtel's plea challenging the DoT demand, but it allowed the telecom firm to approach the appropriate forum against the government decision. Senior advocate Shyam Divan, representing Bharti Airtel, argued that his client received a communication on August 17, saying the firm must make payment and if it fails to do so, then there is a possibility of invoking various bank guarantees. He contended that Rs 18,000 crore dues have already been paid by the telecom company, according to the top court's order and there is another figure, which is attributed to Videocon Telecommunications. He added that there is a particular spectrum traded by Videocon to Airtel and citing the spectrum trading guidelines, he added the seller shall clear all dues prior to concluding any agreement for spectrum trading. "The liability is of Videocon... full liability of the seller," submitted Divan. Divan argued that by adding the dues of Videocon to the demand made from Airtel, the DoT has violated the apex court's order that AGR dues cannot be recalculated or reassessed. The top court said it will not interfere with its order, rather it will grant liberty to Airtel to move any other alternate forum to redress its grievances. Divan said that the alternate forum will be the Telecom Disputes Settlement and Appellate Tribunal (TDSAT). Earlier this year, in an affidavit filed before the Supreme Court on the status of statutory dues paid by telecom operators, the DoT said it is planning to slap Videocon Telecommunications Ltd's AGR dues over Rs 1,300 crore on Bharti Airtel. Videocon Telecommunications had sold spectrum of 30 MHz to Bharti Airtel in 2016. Concluding the hearing, the top court allowed Airtel to withdraw the application and also restrained the DoT from invoking its bank guarantees for 3 weeks. According to the Centre's calculations, the total AGR liability of Bharti Airtel is Rs 43,980 crore, Vodafone Idea's is Rs 58,254 crore, Tata group's is Rs 16,798 crore, BSNL owes Rs 5,835.85 crore, and MTNL Rs 4,352.09 crore. SEE ALSO: <a href="https://www.businessinsider.in/business/telecom/news/airtel-added-5-million-new-4g-users-tariff-hike-hopes-and-record-broadband-customer-addition-surge-share-price/articleshow/85039298.cms">Five million new 4G users, tariff hike hopes and record broadband customer addition send Airtel's stock to a 6-month high</a> <a href="https://www.businessinsider.in/business/telecom/news/the-enormous-gap-between-vodafone-idea-on-one-hand-airtel-and-jio-on-the-other/articleshow/85035781.cms">The enormous gap between Vodafone Idea on one hand, Airtel and Jio on the other</a> <a href="https://www.businessinsider.in/business/telecom/news/vodafone-idea-loses-over-4-million-subscribers-airtel-and-jio-add-over-9-million-in-june/articleshow/85589113.cms">Vodafone Idea loses over 4 million subscribers, Airtel and Jio add over 9 million in June</a>

AGR case: Supreme Court directs DoT not to enchash Airtel's bank guarantees for three weeks

New Delhi, Feb 26 () The telecom department is looking into issues related to payment of statutory dues by mobile telephony services providers, Finance Minister Nirmala said on Wednesday. In all, 15 telecom entities owe the government Rs 1.47 lakh crore in unpaid statutory dues -- Rs 92,642 crore in unpaid licence fee and another Rs 55,054 crore in outstanding spectrum usage charges. Airtel and Vodafone Idea account for about 60 per cent of the estimated dues, which include interest and penalty for late payments.Following the Supreme Court order on the adjusted gross revenue (AGR) of telecom companies, industry honchos Sunil Bharti Mittal and Kumar Mangalam Birla had met the finance minister."Yes meetings have happened. The Department is taking a call so it won't be right on my part to talk about this at the moment. Wait for the Department to come up (with update on this)," she said in a response to the AGR issue.Top management of telecom companies have also met Telecom Minister Ravi Shankar Prasad.These dues arose after the Supreme Court, in October last year, upheld the government's position on including revenue from non-core businesses in calculating the annual Adjusted Gross Revenue (AGR) of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer. The Supreme Court, earlier this month, rejected a plea by mobile carriers such as Bharti Airtel and Vodafone Idea for extension in the payment schedule and asked companies to deposit their past dues for spectrum and licences.Since the February 14 tongue-lashing Supreme Court gave to telecom companies for missing its previous deadline of January 23 to pay past dues as well as the Department of Telecommunication for failing to enforce it, firms and Telecom Ministry are busy doing separate maths on the actual dues.Vodafone Idea, which is confronted with Rs 53,000 crore in statutory dues as per DoT's calculation, has so far paid only 7 per cent of those dues in two tranches. Airtel has paid Rs 10,000 crore out of its estimated liability of over Rs 35,000 crore. DP NKD DP MRMR

Telecom Dept looking into AGR payment issues: FM

New Delhi, Mar 17 () The government's latest proposal seeking easier terms of statutory payment is "incrementally positive" for Vodafone Idea, but uncertainty on outstanding dues still prevails given the discrepancy between AGR math of companies and DoT, according to a brokerage report."We think the discrepancy between telcos' AGR estimate and DoT's estimate will take some time (9-12 months) to resolve with DoT looking to carry out the detailed audit of telcos' claim. We think this can potentially result in another legal battle if both parties maintain a recalcitrant attitude," Credit Suisse said in its latest note.The Centre on Monday moved the Supreme Court seeking approval of its formula to allow telecom companies to pay their Adjusted Gross Revenue (AGR) dues in annual instalments for over 20 years to avoid impact on the economy. Under the formula mooted by the government, telecom companies impacted by the October 24 verdict of the Supreme Court could be allowed to pay the DoT-assessed dues in annual instalments in over 20 years (or less if they so opt), "duly protecting the next present value of the said dues using a discount rate of eight per cent (based on one year marginal cost of lending rate of SBI which is currently 7.75 per cent)".As per the formula, the interest on the unpaid amount, penalty, and interest on penalty in relation to the past dues as on the date of the judgement will not be levied beyond the date of the said judgement, and the net present value will be protected using the discount rate.The proposal placed before the SC for consideration also states that telecom firms would continue to be liable for interest, penalty, and interest on penalty for unpaid dues of licence fee and spectrum usage charge which arises prospectively after the October 24, 2019 verdict. In its report, Credit Suisse observed that the Department of Telecom (DoT) is seeking a 20 year tenure for AGR payment, and said, "while this is incrementally positive for Vodafone Idea as it can ease the immediate cash flow burden on the company, the uncertainty on outstanding dues still prevails."DoT in its filing has stuck to its original AGR calculation of Rs 53,000 crore and Rs 37,700 crore for Vodafone Idea (VIL) and Bharti Airtel, respectively, which are higher than the estimates by these companies. On the latest tranche of payment (Rs 3,354 crore) made by VIL on Monday towards its principal dues, Credit Suisse said, while the company may be able to sustain over next two years with the spectrum and AGR payment deferment, its cash flow analysis suggests that business viability is under cloud even at Rs 200 ARPU (and subscriber base of 280 million) once the deferred spectrum payment resumes in fiscal 2023."The company will need strong operational improvement along with meaningful equity infusion to sustain in the long term. Our analysis further suggests that VIL would need Average Revenue Per User (ARPU) levels of Rs 145 to meet interest obligation on its debt and ARPU levels of Rs 230 to achieve cash flow breakeven (post FY23)," it said. The analysis is sensitive to subscriber market share assumption where generous assumption of 280 million has been taken. "The key variable for sector viability is mobile pricing where there is limited clarity on TRAI's stance on floor pricing," it said.While telcos, in their response to Telecom Regulatory Authority of India (TRAI) consultation paper have sought introduction of floor tariff in addition to usage charges (data and voice) which helps to raise revenues for telcos in the near term, Competition Commission of India has opposed it, the report said. MBI MBI ANUANU

Govt formula on AGR payment incrementally positive for VIL, but uncertainty on dues looms

New Delhi, Feb 3 () The government has not included AGR dues payment in the Budget 2020-21, Economic Affairs Secretary Atanu Chakraborty said on Monday.
It is pertinent to mention here that 15 entities owe the government about Rs 1.47 lakh crore in past dues -- Rs 92,642 crore in unpaid licence fee and another Rs 55,054 crore in outstanding spectrum usage charges.
"AGR dues payment has not been taken into account in the Budget," Chakraborty said at a post Budget event in Ficci.
Sources, meanwhile, said that past AGR or statutory dues payments have not been included as the matter is in the court. Bharti Airtel, Vodafone Idea, and Tata Teleservices have jointly filed a modification application in the Supreme Court seeking more time to pay their statutory dues.
They indicated that spectrum auction component may have been included in the receipts although the same could not be confirmed.
The government on Saturday increased the revenue estimate from the debt-ridden telecom sector by over two-folds to Rs 1.33 lakh crore for 2020-21. The government, in the receipt budget, has pegged a revenue collection of Rs 1,33,027.2 crore for financial year 2020-21 under communications head.
It expects a revenue of Rs 58,686.64 crore under communications head in the current fiscal year against budgeted amount of Rs 50,519.8 crore in 2019-20.
The Supreme Court, in October last year, had upheld the government's position on including revenue from non-core businesses in calculating the annual Adjusted Gross Revenue (AGR) of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer.
In the case of Bharti Airtel, the liabilities add up to nearly Rs 35,586 crore, of which Rs 21,682 crore is licence fee and another Rs 13,904.01 crore is spectrum usage charge dues (not including the dues of Telenor and Tata Teleservices).
Airtel, which recently raised USD 3 billion through Qualified Institutional Placement (QIP) and convertible bonds route, is scheduled to announce its third quarter results on Tuesday.
Vodafone Idea, which is staring at unpaid statutory dues of Rs 53,038 crore, including Rs 24,729 crore of spectrum dues and Rs 28,309 crore in licence fee, has already warned of shutdown if no relief is given.
Most of the remaining liability is with state-owned BSNL/MTNL and some of the shut/bankrupt telecom companies. DP JD MBI BAL

Govt not included AGR dues payment in Budget 2020-21: DEA Secy

A day after Bharti Airtel approached the <keyword id="6354977" type="COMPANY" weightage="20" keywordseo="Supreme-Court">Supreme Court</keyword> over the assessment of adjusted gross revenue (AGR) calculations, <keyword id="1553175" type="PERSON" weightage="20" keywordseo="Vodafone-Idea">Vodafone Idea</keyword> also moved the top court seeking "correction" in the AGR assessment. The petition filed by the telco on Thursday said that payments made by the company have not been accounted for in the AGR demands issued by the department. Further, it also said that double counting has been done on some revenue items in the AGR demands. It also said that deduction has not been given for PSTN related call charges and for roaming charges actually paid to other operators. "The excess demand upon the applicant which is attributable to these error amounts to Rs 5,932 crores of principal amount, which would have an overall impact of over four times on the total principal amount aforementioned due to the imposition of interest, penalty and interest on penalty," the petition said. In September, the <keyword id="6356229" type="COMPANY" weightage="20" keywordseo="apex-court">apex court</keyword> allowed telecom operators 10 years to pay up <keyword id="8275485" type="UNKNOWN" weightage="20" keywordseo="agr-dues">AGR dues</keyword>. Vodafone Idea's total AGR dues as per DoT stood at Rs 58,254 crore, while the dues according to the company stood at Rs 21,533 crore. The company has paid AGR dues worth of Rs 7,854 crore so far. Shares of the telco moved higher on the development. Around 1.08 p.m. Vodafone Idea shares on the BSE were trading at Rs 12.17, higher by 1.67 per cent from its previous close. SEE ALSO: <a href="https://www.businessinsider.in/business/telecom/news/airtel-approaches-supreme-court-claiming-error-in-assessment-of-agr-dues-by-dot/articleshow/80135781.cms">Airtel approaches Supreme Court claiming error in assessment of AGR dues by DoT</a>

Vodafone Idea approaches Supreme Court over AGR dues

The Supreme Court on Monday reserved its judgment on the issue of recovery of adjusted gross revenue (AGR) dues from insolvent telecom companies. A bench headed by Justice Arun Mishra is likely to pronounce the judgment on three counts: Staggered payment schedule, where the Centre said it is fine with 20-year arrangement to recover AGR dues; Can spectrum be transferred or sold by companies under IBC; and, additional liabilities, if any, on Jio, Airtel for the past dues of RCom, Videocon, and Aircel. Airtel had spectrum sharing and trading pacts with Videocon and Aircel, whereas Jio had it with RCom. The court had asked the Department of Telecommunications (DoT) to share the details of 'demand under process' for raising the liabilities against Airtel and Jio in the backdrop of spectrum-sharing. The bench also comprising Justices S Abdul Nazeer and MR Shah observed that if DoT does not provide the correct position on the AGR demands, then the due figures quoted in the ruling could go wrong. "It has been nearly 10 months to the AGR ruling -- why has the DoT not yet raised the demand?" The DoT informed the bench that no demand has been raised against Jio and Airtel for part dues of RCom and Videocon, and that the assessment of Jio and Airtel liability for the past dues is "under process". Senior Advocate Harish Salve, appearing for Committee of Creditors for RCom, contended before the bench that the right to use spectrum is an "asset which can be sold", if the company wants to. Salve added that the resolution plan proposes the sale of the right to use spectrum is in line with the licence trading guidelines. Senior Advocate Kapil Sibal, appearing for Airtel, contended that if the liability of the past dues of Videocon were to be imposed on Airtel, why wait for so long. Instead, the DoT should have clarified it long back, he argued. The court observed that according to trading guidelines, the seller of the spectrum shall satisfy all pending dues, before the sale. The bench said that it understood that upon the non-payment of dues by the seller, the trading guidelines would transfer the burden on the buyer. The DoT counsel contended that under trading guidelines, the past dues have to be cleared prior to the spectrum-trading, and under these guidelines, the DoT could recover the dues from seller and buyers. The bench questioned why no demand was raised against Airtel for the past dues of the Videocon spectrum. Sibal said Airtel had been paying all pending dues since the acquisition of the Videocon spectrum in May 2016. The apex court remarked that what is being proposed seems like renting out a house to a tenant and the latter selling the house under Insolvency and Bankruptcy Code.

Supreme Court reserves order on recovery of AGR dues from insolvent telecom companies

New Delhi, Mar 19 () The Department of Telecom's plea seeking 20 years time for operators to pay adjusted gross revenue dues was approved by the Cabinet, Union minister Sanjay Dhotre informed Parliament on Thursday. The Supreme Court will hear the government's rescue plan of giving telcos a 20-year repayment period for AGR dues during the next hearing scheduled after two weeks."Consequent to the approval by the Cabinet, an application has been moved before the Hon'ble Supreme Court on March 16, 2020, seeking, inter-alia, permission of the Hon'ble Court for the licensees impacted by the AGR judgement to pay the unpaid or remaining to be paid amount of past DoT assessed/calculated dues in annual instalments over 20 years duly protecting the net present value of the said dues using a discount rate of 8 per cent," the Minister of State for Communications told the Rajya Sabha in a written reply. The Supreme Court on Wednesday had lashed out at Bharti Airtel, Vodafone Idea and other mobile phone operators for self-assessing their outstanding telecom dues, saying they need to pay past dues with interest and penalty -- an estimated amount of Rs 1.69 lakh crore. The apex court also came down heavily on the Department of Telecommunications (DoT) for allowing companies to re-assess what they owed to the government, and said its order -- passed on October 24, 2019 -- on revenues for calculating dues was final. A bench of Justice Arun Mishra, Justice S A Nazeer and Justice M R Shah refused to take up the Centre's plea for allowing telecom companies to pay AGR dues in 20 years, saying the application will be taken up after two weeks. "The time frame of 20 years is unreasonable. The telecom companies have to clear all dues mentioned in the judgement," the bench said, adding it had settled all AGR dues after hearing telecom companies and the government then had fought tooth and nail for interests and penalties.Bharti Airtel, Vodafone Idea and Tata Group's self-assessment of dues to the government are a whopping Rs 82,300 crore short of what the telecom department calculated after the Supreme Court's ruling on AGR. The Department of Telecommunications (DoT), according to its own submission to the apex court seeking relief in payment tenure, has put dues of the three companies at Rs 1.19 lakh crore. The dues estimated by DoT for Bharti Airtel and Telenor was pegged at Rs 43,980 crore, while that of Vodafone Idea was Rs 58,254 crore, and Tata Group of companies at Rs 16,798 crore outlined under 'total demand of DoT incorporating CAG and special audit as on October 2019'. Against this, Bharti Group has calculated its dues at Rs 13,004 crore, Vodafone Idea at Rs 21,533 crore and Tata Group of companies at Rs 2,197 crore. In all, AGR dues calculated by the government for 16 entities add up to Rs 1.69 lakh crore, while telcos' self-assessment place their dues at a mere Rs 37,176 crore. These dues arose after the Supreme Court, in October last year, upheld the government's position on including revenue from non-core businesses in calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer. The bench said it will summon the secretary and desk officer of DoT who permitted telecom companies to do self-assessment of AGR dues. PRS MR

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AGR case: Supreme Court directs DoT not to enchash Airtel's bank guarantees for three weeks

IANS

Telecom Dept looking into AGR payment issues: FM

PTI

Govt formula on AGR payment incrementally positive for VIL, but uncertainty on dues looms

PTI

Govt not included AGR dues payment in Budget 2020-21: DEA Secy

PTI

Vodafone Idea approaches Supreme Court over AGR dues

IANS

Supreme Court reserves order on recovery of AGR dues from insolvent telecom companies

IANS

DoT plea to seek 20 year time for payment of AGR bears cabinet stamp

PTI

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