DoT withdraws Rs 2.3 lakh cr demand notices on GAIL, OIL

By: |
July 16, 2020 5:09 PM

In case of GAIL, which held an IP-II license, the DoT assessed Rs 1,83,076 crore as outstanding after including interest and penalty computed on the entire revenue of the company.

The Department of Telecommunications (DoT) has withdrawn a demand of over Rs 2.3 lakh crore it had made on state-owned gas utility GAIL India Ltd and explorer Oil India Ltd (OIL) in past telecom dues, the companies informed stock exchanges. Following the October 24, 2019 order of the Supreme Court asking inclusion of non-telecom revenues for calculating statutory dues such as license fee and spectrum charges of telecom firms, the DoT had sought Rs 1.83 lakh crore from GAIL and another Rs 48,489 crore from OIL in past dues.

The withdrawal follows the Supreme Court ruling last month, terming the adjusted gross revenue (AGR) dues raised on non-telecom PSUs “wholly and totally impermissible”. It asked DoT to reconsider such demand, and the department has now formally withdrawn them. GAIL said it has received a letter dated July 14 from DoT “towards the withdrawal of all provisional demand notices issued” to the company.

“Consequent upon the withdrawal of claims, nothing remains due to DoT by GAIL in the matter of AGR,” it said.
OIL, in a separate filing, said it has received a letter dated July 13 from DoT “communicating the withdrawal of demand notices amounting to Rs 48,489.26 crore issued against the company for the financial year 2007-08 to 2018-19.”

On Wednesday, Power Grid Corporation of India Ltd (PowerGrid) had in a regulatory filing stated that DoT has withdrawn “provisional demand notices towards license fee including interest, penalty, and interest on penalty in respect of NLD and ISP licenses pertaining to FY 2006-18 to FY 2018-19.” DoT had sought Rs 13,613.66 crore from PowerGrid for the past years in NLD license fee.

OIL, the nation’s second-biggest state-owned oil producer, holds a National Long Distance Service Licence (NLD) with the primary objective of monitoring and operation of its pipeline network. The surplus bandwidth capacity available with the company was leased out to telecom operators/other users, on which the company regularly paid the applicable license fee to the DoT. But following the October 24 ruling, the DoT included all revenues from oil and gas to seek Rs 48,489 crore from the company for the period from 2007-08 to 2018-19.

In case of GAIL, which held an IP-II license, the DoT assessed Rs 1,83,076 crore as outstanding after including interest and penalty computed on the entire revenue of the company. PowerGrid holds NLD and Internet Service Provider (ISP) licenses.

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