DoT sends out a notice seeking compliance with Supreme Court order

A day after Vodafone Plc’s Chief Executive Officer cast doubt over the future of its India operations due to massive financial stress, the Department of Telecom has issued notices to all operators asking them to pay up their licence fee dues as per the Supreme Court ruling on the issue of Adjusted Gross Revenue (AGR).

The DoT has asked all operators, including Internet Service Providers and Virtual Network Operators, to do a self-assessment of their respective dues as per the licence conditions, a top official told BusinessLine.

Industry experts said that the DoT should have calculated the dues owed by various operators instead of asking the telecom companies to do a self-assessment.

DoT figures

The DoT had submitted a document in the Supreme Court which stated that about 16 operators owed ₹92,000 crore.

It had given operator-wise break up of dues, penalties and interest levied.

However, latest estimate shows that a total of 41 companies would have to shell out nearly ₹2.27 lakh crore, including penalties. British telecom company Vodafone Plc on Tuesday had warned that its joint venture with the Aditya Birla Group, Vodafone Idea, could be facing liquidation if it does not get financial support from the Government. Vodafone has called for the dues demanded by the court to be spread over 10 years.

According to an earlier estimate, Vodafone Idea has to pay around ₹28,000 crore and Airtel has to cough up about ₹20,000 crore.

Operators have to pay a part of their annual AGR as licence fee and spectrum usage charge.

The operators had claimed that they are liable to pay revenue share only on income generated from telecom services.

The DoT opposed this claim and wanted a share of income from non-licenced activities as well. The operators went to court and stopped paying revenue share on the disputed amount. Upholding the DoT’s view, the Supreme Court said that except for income from termination fee and roaming charges, operators have to pay revenue share on all other income.

The DoT’s notice makes one thing clear that the impact of the top court’s decision is not restricted to telecom companies but also a number of public sector units holding Internet service licences such as GAIL India, Power Grid Corporation, Oil India, Delhi Metro and RailTel.

  Airtel, Bharti Airtel Ltd, Idea, service, telecommunication, Vodafone, Vodafone India