Airtel asks India Govt. to review AGR definition after setback in SC

Airtel, which will feel the pressure due to upholding of the AGR by India’s Supreme Court today, has demanded proper review from India government.
telecom-tower-technologySupreme Court allowed the Centre’s demand to recover adjusted gross revenue (AGR) of about Rs 92,000 crore from telecom service providers.

A three-judge bench, headed by Justice Arun Mishra, upheld the definition of the adjusted gross revenue formulated by the Department of Telecom (DoT).

“We have held that the definition of AGR will prevail,” the bench, also comprising Justices Vineet Saran and S Ravindra Bhat, said.

“We have allowed the appeal of the Department of Telecom and dismissed that of telcos,” the top court said while reading the operative portion of the judgment.

SC rejected all other submissions of the telecom companies. Indian service providers would have to pay penalties and interests to the DoT.

Airtel said in a statement: “We are disappointed by the verdict of the Supreme Court. The issue of inclusion of revenue from non-telecom activities and interpretation of the heads included in the definition of AGR under the license conditions has been through several rounds of litigation, which have been in favour of the TSPs till now.”

This decision has come at a time when the sector is facing severe financial stress and may further weaken the viability of the sector as a whole. Of the 15 old operators impacted by the order, only two private sector operators remain in service today. The Government must review the impact of this decision and find suitable ways to mitigate the financial burden on the already stressed industry, Airtel said.

The SC bench made it clear that there would no further litigation on the issue and it would fix a time frame for calculation and payment of dues by the telecom companies, PTI reported.

While mobile operators have paid already 85 percent of the demand raised by the DoT, the remaining 15 percent has stayed disputed for a long time with the TSPs getting favorable judgments in various legal forums, including TDSAT, High Courts and even Supreme Court, Hindu Business Line reported.

DoT is demanding Rs 92,641 crore — disputed actual demand of Rs 23,189 crore, levy of Interest of Rs 41,650 crore, penalty of Rs 10,923 crore and interest on penalty of Rs 16,878 crore from telecom operators.