Supreme Court Rules Out Reassessment Of AGR Dues; Next Hearing In Two Weeks
A commuter uses a mobile phone while travelling by train in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)  

Supreme Court Rules Out Reassessment Of AGR Dues; Next Hearing In Two Weeks

The Supreme Court today said that telecom companies will have to pay interest and penalty as per its earlier judgment.

The two-judge bench consisting of Justice Arun Mishra and Justice MR Shah asked the telecom department as to who allowed the companies to reasses the dues and said it will amount to sheer contempt of court. “We are of the conclusive opinion that no self-assessment or reassessment shall be done.”

The top court was hearing the petition filed by the Department of Telecommunications which had proposed a staggered payment of adjusted gross revenue dues over a period of 20 years in view of the current economic condition of the industry, and the impact it will have, including on consumers and job losses, if one of the operators decides to file for bankruptcy, according to an affidavit filed in the apex court.

The top court made it clear that it will not allow another round of litigation in the case and the companies will have to make the payments as per the directions of the court in the October judgement. “DoT’s demand has been confirmed by us, where does the question arise? This cannot be allowed when our orders clearly spells out the dues,” said Justice Arun Mishra.

The government’s rescue plan will be considered in the next hearing after two weeks.

Reassessment of dues could have benefitted debt-laden Vodafone Idea Ltd. the most. If telecom operators are allowed to pay the balance over a period of 20 years, then the annual payout for Airtel, Vodafone Idea and Tata Group would be close to Rs 2,646 crore, Rs 5,235 crore and Rs 1,283 crore, respectively, according to BloombergQuint’s calculations.

Here are some of the other observations from the Supreme Court:

  • Reassessment of dues may be contempt of court.
  • Entire country is being misled.
  • Department of Telecom demand has been confirmed by this court, how can there be self-assessment?
  • This cannot be allowed when our order clearly spells out the dues.
  • Some players have suggested that eight to 10 months will be required for corroborating numbers of self-assessment; this cant be allowed.
  • All the newspapers are trying to influence the courts.
  • All the companies are trying to influence us through the media.
  • Everyday, some fresh reports are being published in the media.
Government fought tooth and nail, suggested penalty during arguments earlier. Now you want to do away with the interest?  
Supreme Court Bench’s Observation
  • Withdraw the DoT move to allow self-assessment.
  • There can be no further exercise regarding dues payable.
  • Even telecom firms should not have any further litigation regarding dues payable.
  • There is subterfuge at play regarding the dues.

Here’s what the telecom companies had to say:

Vodafone Idea Ltd.

  • There has been some error in calculation of dues

Bharti Airtel Ltd.

  • Will not circumvent the top court's judgment; have deposited Rs 18,000 crore.
  • Companies are complying, but we need some time to pay the dues.

Vodafone Idea Ltd. stock reversed gains to fall as much as 44.3 percent to Rs 2.7 apiece during the court hearing, before paring losses to 23.9 percent as of 11:45 a.m.

Also read: Only Vodafone Idea Stands To Benefit From India’s Plan To Offer AGR Dues Relief

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