SC refuses to entertain Vodafone, Airtel pleas for AGR relief

Supreme Court rejects telecom majors' plea for relief in AGR payments, citing petitions as "misconceived" and upholds previous judgments.

The Supreme Court on Monday rejected pleas by telecom majors Bharti Airtel, Vodafone Idea and Tata Teleservices for relief in the payments of their adjusted gross revenue (AGR) liabilities.

A Bench of Justices J.B. Pardiwala and R. Mahadevan termed the petitions “misconceived.”

The telcos had wanted relief in the payment of their interest on the dues, penalty and interest on the penalty. They appealed to the Supreme Court’s sense of equity, saying they were under severe financial strain owing to a series of court rulings on AGR over the years.

The companies sought a waiver of more than ₹40,000 crore in liabilities related to the AGR, invoking the fundamental right to equality under Article 14 of the Constitution to afford all players an equal opportunity and level field. The companies had argued that a waiver was the need of the hour to ensure the stability of the sector.

In September last year, the apex court had dismissed curative petitions filed by the telecom service providers against an October 2019 judgment upholding the Department of Telecom’s (DoT) move to recover AGR dues to the tune of about ₹92,000 crore from them.

The October 2019 verdict had said the telecom sector had long reaped the fruits of the Centre’s liberalised mode of payment by revenue sharing regime with the government. Under this mechanism, the operators had to pay a certain licensing fee and spectrum usage fee to the DoT. The Department calculated the fee as a percentage of the AGR. The dispute between the private telecom sector and the government over the calculation of the AGR has spanned over two decades.

“The sector has benefited immensely under the scheme as apparent from the gross revenue trend from 2004 to 2015… The telecom service providers in spite of the financial benefits of the package started to ensure that they do not pay the licence fee to the public exchequer based on an agreed AGR,” the Supreme Court had observed in its 153-page judgment in 2019.