AGR Dues Case: Vodafone Idea Seeks Immediate Supreme Court Listing Of Its Curative Plea

Vodafone Idea Ltd. on Monday sought an urgent listing of its curative plea against the judgement in the adjusted gross revenue dues case. The telecom operator is seeking a limited reconsideration of the judgement that held India’s telecom operators will have to include non-core revenue to calculate their adjusted gross revenue.

Appearing for Vodafone Idea, senior advocate Harish Salve told a three-judge bench led by the Chief Justice of India, DY Chandrachud, that the company is looking to raise funds to pay off its dues, but the potential lenders want clarity on the company's precise liabilities.

Salve said the plea was filed in September last year, but it hasn’t been listed yet. The CJI said he'd soon take a call to list the case.

Adjusted gross revenue is the basis for a revenue sharing mechanism between the government and the telecom operators.

Under this mechanism, the operators have to pay a certain licencing fee and spectrum usage fee to the Department of Telecommunications. The fee is calculated as a percentage of the AGR. However, the definition of what constitutes AGR has been under dispute since 2005.

Before various judicial forums, the telecom operators had claimed that the definition should include only their core revenue, whereas the department claimed that all the revenue, including revenue from non-telecom services, must be factored into the definition.

In October 2019, the Supreme Court ruled that non-core revenue must be included while calculating the AGR, ending a 14-year-long legal battle between mobile operators and the government on the definition of AGR.

Telecom giants such as Bharti Airtel Ltd. and Vodafone Idea have been contending that there has been a grave error in the calculation of the AGR dues.

Vodafone Idea’s plea, which has been reviewed by NDTV Profit, states that “the components of penalty and interest on penalty have reached such a gigantic proportion that it threatens the very existence of Vodafone Idea.”

The 2019 judgement dealt a crippling blow to the bruised industry that stared at dues and penalties worth thousands of crores. It had increased the liabilities of Bharti Airtel and Vodafone Idea to more than Rs 90,000 crore.

Soon after, the companies approached the court, seeking more time for payment of their dues. In September 2020, the apex court allowed for the payment of dues over 10 years.

In a separate plea in 2021, the top court dismissed the applications filed by telecom companies that sought permission to approach the DoT on the calculation of the dues in the case, claiming arithmetic errors in the department's calculation of the dues.

In the aftermath of the AGR judgement, the government owns a 33% stake in Vodafone Idea. The shares were allocated to the government in lieu of the conversion of interest dues arising from the deferment of adjusted gross revenue and spectrum auction payments.