Govt Reviews Vodafone Idea AGR Dues After SC Directive; Relief Talks Still At Early Stage

The government is reassessing Vodafone Idea’s adjusted gross revenue liabilities following the Supreme Court’s October directive allowing reconciliation of dues up to FY17, including interest and penalties.

While officials from the Department of Telecommunications and Finance Ministry have held preliminary discussions, sources to NDTV Profit indicate that a complete waiver of AGR dues is off the table. The intent, insiders say, is to support telcos’ revival within legal boundaries, with another round of meetings expected soon.

This development comes amid heightened speculation over potential government intervention to ease Vodafone Idea’s financial burden.

Last month, the Supreme Court on Nov. 4 allowed the government to review the company’s pending adjusted gross revenue dues. In its plea, the telecom operator had asked for relief on both additional AGR dues and a reassessment of all pending dues.   

The apex court said that the government can review and re-evaluate the AGR dues up to the financial year 2016-17, including interests and penalties. For the telecom companies, the government uses AGR as a measure to calculate the licence fees and spectrum charges.

In May the company sought relief from cumulative AGR liabilities exceeding Rs 80,000 crore, citing financial strain. Then, On Sept. 8, Vodafone Idea approached the court again, contesting the DoT’s demand for an additional Rs 9,450 crore. The company also requested a waiver of interest and penalties.

However, in other news Telecom Regulatory Authority of India's data pointed that Vodafone Idea lost 20.83 lakh wireless subscribers; its mobile user base dipped to 20.07 crore in October (from 20.28 crore in September).

Compared to this other major service providers like Bharti Airtel, Jio and BSL all gained user base. Overall, India's total telephone subscriber base rose to 123.1 crore as of October, which is the latest record available.