SC allows government to address Vodafone Idea's AGR concerns
What's the story
In a major relief for Vodafone Idea, the Supreme Court of India has allowed the government to address its grievances without court intervention. The decision comes as part of a reassessment of the telecom operator's adjusted gross revenue (AGR) dues. The bench, led by Chief Justice B.R. Gavai and Justice K. Vinod Chandran, said that any relief to the telecom operator is a policy matter.
Legal battle
What is the case about?
Vodafone Idea had filed a petition last month against the Department of Telecommunications (DoT) for demanding an additional ₹9,450 crore in AGR dues. The telecom operator also sought a waiver of interest and penalties on its dues, contending that the disputed components of these dues are yet to be finalized. The Supreme Court had previously locked Vodafone Idea's AGR dues till 2016-17 based on DoT's calculations and prohibited self-assessment or reassessment of these dues.
Case details
New ₹9,450 crore dues demanded by DoT
The DoT has now sought additional payments for up to 2018-19, Vodafone Idea said in its September 8 petition. Of the new ₹9,450 crore dues demanded, ₹2,774 crore was raised from Idea Group and Vodafone Idea (post-merger in August 2018), while the demand against Vodafone Group (pre-merger) was ₹6,675 crore. The department said that the license fee dues were calculated with interest and penalty interest till October 2019 and updated till March 31, 2025 at an annual rate of 8%.
Petition update
Waiver of penalties, interest sought
On September 18, Vodafone Idea filed an amended petition with the Supreme Court seeking a waiver of penalties and interest on AGR dues. The telecom operator argued that both DoT and itself agree that the amounts need to be reconciled, corrected, and finalized. "Till the principal amount payable is not crystallized and finalized, it cannot be said that the petitioner is in default requiring payment of penalty," Vodafone Idea said in its petition.
Financial challenges
Vodafone Idea owes ₹83,400 crore in AGR dues
Vodafone Idea owes around ₹83,400 crore in AGR dues to the government. Its total liabilities to the government, including penalties and interest, are estimated at around ₹2 trillion. The telecom operator has previously said that its cash flows are insufficient to pay these accumulated dues. In August, former CEO Akshaya Moondra had said an early resolution of the AGR dispute was critical for securing bank funding.