In a major setback for mobile operators, the Supreme Court on Tuesday set aside the TDSAT order that excluded their income from dividend and interest on savings, capital gains as well as benefits from foreign exchange from the purview of adjusted gross revenue (AGR) for calculating the revenue share licence fee paid to the government.

This means that now the operators will have to include income from such streams also while paying the licence fee, which will increase their outgo. Typically, in a unified access service licence (UASL) operators pay a licence fee ranging between 6-10% of their AGR depending on the circles.

The tribunal in its ruling on August 30, 2007 had included income earned from telecom handsets given to subscribers bundled with their services in AGR in calculating licence fee. Besides, the rent earned from property, and the income from the sale or lease of telecom towers and dark fibre lines was included in cellular operators’ AGR.

A Bench headed by Justice R V Raveendran while remitting the matter asked the tribunal to decide in accordance with law.

While holding that the Central government has the exclusive privilege of establishing and regulating telecom activities, it said that the tribunal has no jurisdiction to decide upon the validity of the terms and conditions incorporated in the license of a service provider.