Tata Communications Q3 Results: Profit Falls 79%, Misses Estimates

Following the Oct. 16 Supreme Court ruling that held that licence fee paid at regular intervals should be classified as capital expenditure, the telecom company said that it created a tax provision for Rs 185.52 crore towards interest and Rs 21.09 crore towards tax (net), due to change in effective tax rate on account of adoption of new tax regime. This was recorded as an exceptional item in the profit and loss statement.

Even though the company is not a party to the above judgement and its case is "different and distinguishable" from the above judgment, as a matter of prudence, the company said it has recorded the provision.