SC rejects Airtel, Vodafone Idea's plea on AGR dues miscalculation
What's the story
The Supreme Court of India has rejected review petitions of telecom giants Bharti Airtel and Vodafone Idea. The companies had sought corrections in the calculation of their adjusted gross revenue (AGR) dues. The verdict upholds the apex court's 2021 decision, leaving the telecom firms with no further legal recourse. They had claimed that the Department of Telecommunications (DoT) made major errors in its AGR calculations, including ignoring payments already made.
Market impact
Telecom stocks tumble following Supreme Court's verdict
The Supreme Court's ruling resulted in a decline in the share prices of the impacted telecom companies. Vodafone Idea's share price declined by 4.16% to ₹8.29 per share, while Bharti Airtel witnessed a lesser decline of 0.51% to ₹1,705. Indus Towers' shares also took a hit following the ruling. The dispute over AGR dues calculation errors has been ongoing since July 2021, with telecom firms contending that these inaccuracies have led to inflated dues of over ₹1 lakh crore.
Legal history
Supreme Court's stance on AGR dues remains firm
Notably, the Supreme Court has remained firm on the matter of AGR dues. In September 2023, a similar plea seeking re-computation was rejected. Earlier in 2022, curative petitions of Bharti Airtel and Vodafone Idea were also rejected. The firms had sought an "open court" hearing against a past ruling that rejected their plea to correct alleged calculation errors in the DoT's assessment of AGR dues.
Waiver consideration
Government's proposal to waive AGR dues
Earlier this month, reports had emerged of a government proposal to waive AGR dues for telecom companies. The government was reportedly considering "to waive 50% of interest and 100% of penalties and interest on penalties" that make up a large chunk of the AGR dues levied on telcos such as Vodafone Idea and Bharti Airtel following the Supreme Court order in 2019.