Supreme Court Gives Verdict on AGR – Got 10 Years To Repay Dues
AGR Case Supreme Court Decision- In the case of Adjusted Gross Revenue (AGR), the Supreme Court has given a big relief to the telecom companies in the judgment. He has got 10 years to pay the AGR dues.
New Delhi: The Supreme Court of India has given a big relief to the Telecom Companies in the judgment of the Adjusted Gross Revenue (AGR) case. Companies have got 10 years to pay AGR dues. However, the companies had asked for 15 years. After this news, Vodafone-Idea shares fell over 10 percent on the NSE. At the same time, Bharti Airtel’s stock has gained 5% strongly. The Supreme Court gave its first verdict on 24 October 2019 on the outstanding dues of AGR. After this, Vodafone Idea had openly said that if it is not bailout then it will have to stop its operations in India.
Let us tell you that Vodafone Idea and Bharti Airtel had asked for 15 years to repay the AGR dues. So far 15 telecom companies have paid only Rs 30,254 crore, while the total outstanding is Rs 1.69 lakh crore.
Telecom companies get 10 years time – The bench headed by Justice Arun Mishra has allowed paying the AGR dues in 10 years. The Supreme Court in its ruling has asked the telecom companies to pay 10% of AGR’s outstanding dues now and pay the remaining amount in the next 10 years. Telecom companies will have to submit an affidavit to pay AGR dues. If companies default on payments during these 10 years, then interest and penalty will have to be paid.
— CNBC-TV18 (@CNBCTV18Live) September 1, 2020
WHAT IS AGR MATTER – In simple words, Adjusted Gross Revenue (AGR) is the usage and licensing fees charged by the Department of Telecommunications (DoT) from telecom companies. It has two parts – spectrum usage charge and licensing fees, which are 3-5% and 8% respectively. The Telecom Department states that the AGR should be calculated based on the total revenue generated by a telecom company, including income from non-telecom sources such as deposit interest and asset sales.
At the same time, the telecom companies said that AGR should be calculated only on the basis of income from telecom services. But last year, the Supreme Court ruled against the telecom companies and said that they should immediately pay the arrears of AGR. The total dues of about 15 telecom companies are around Rs 1.69 lakh crore.