AGR issue: SC notice to Vodafone, Tata Comm

Written by Indu Bhan | Indu Bhan | New Delhi | Updated: Jul 26 2012, 06:47am hrs
The Supreme Court has sought reply from four Vodafone companies and Tata Communications as to why the telecom companies should not follow the accounting system (accrual basis) adopted by the DoT in respect of calculating Adjusted Gross Revenue (AGR).

A bench headed by Justice SS Nijar sought reply from Tata Communications, Vodafone Essar Gujarat, Vodafone Essar Cellular, Vodafone Essar Digilink and Vodafone Essar South on whether the accounting system adopted by DoT for the purpose of crediting and debiting revenue income and expenditure by telecom operators, who have taken the benefit of migration package and are subject to a sharing regime based on AGR, is correct.

The court also tagged the petitions filed by DoT with similar petition (in the case of Bharti), pending before it.

The cases relate to deductions from gross revenue of two items - access and roaming charges to other operators for levying of licence fees - for 2004-06. The department says that deductions are to be allowed on actual basis.

Under the Telecom Policy, operators have to pay 6-10% of their adjusted gross revenue to the telecom department as revenue share or licence fee under the AGR regime.