Telcos’ plea: No reassessment of AGR dues, says SC

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July 20, 2021 5:40 AM

Observing that the apex court had not just once, but twice, thrice stated that the AGR demand can’t be recomputed, a bench led by justices LN Rao, SA Nazeer and MR Shah said the judgment of September 1, 2020, had clearly spelt out that there will be no reassessment of the dues.

"Police is a state subject. We will issue notice and pass comprehensive orders. This cannot continue. Judiciary we can take care separately but police are also there," Justice Nariman said."Police is a state subject. We will issue notice and pass comprehensive orders. This cannot continue. Judiciary we can take care separately but police are also there," Justice Nariman said.

The Supreme Court on Monday said it will pass orders on the plea of telecom operators – Bharti Airtel, Vodafone Idea, and Tata Teleservices – seeking rectification of arithmetical errors in the calculation of their adjusted gross revenue (AGR) dues, but reminded them that its earlier order on the matter has ruled out any recomputation of the dues.

Observing that the apex court had not just once, but twice, thrice stated that the AGR demand can’t be recomputed, a bench led by justices LN Rao, SA Nazeer and MR Shah said the judgment of September 1, 2020, had clearly spelt out that there will be no reassessment of the dues.

“You (telcos) all are saying the same thing. You say there are arithmetical errors and you be permitted to go to the government to get that corrected,” it said.

As is known, Bharti Airtel and Vodafone Idea had earlier this year moved the SC seeking modification of its September 1 order so that the department of telecommunications (DoT) can consider their submissions regarding arithmetical errors in the calculations regarding their AGR dues.

The companies have claimed that they were not seeking reassessment of their dues but were merely seeking a recalculation, as they fear a number of clerical errors may have crept in keeping records of payment that were made across two decades at multiple offices across the country.

These applications arise out of the September order that granted 10 years time to the operators to clear their AGR dues to the DoT from April 1, 2021 till March 31, 2031. The apex court had also asked the telcos to pay 10% of their dues upfront. It had also clarified that no revaluation of AGR dues would be allowed and any default would invite interest, penalty, along with contempt of court orders.

While DoT had estimated that Bharti Airtel owed `43,980 crore, Airtel’s own estimate put the dues at `13,004 crore. For Vodafone Idea, the numbers were `58,254 crore against its self-assessment of `21,533 crore, while for Tata Teleservices, DoT estimates pegged the amount at `16,798 crore against its own calculation of `2,197 crore.

The operators told the court on Monday rectification is different from reassessment or recalculation of AGR dues. However, DoT was hesitant to revise its raised demand or rectify errors unless allowed by the apex court.

Bharti Airtel had claimed that the excess demand due to these errors was to the tune of `5,932 crore of principal amount, which would have an overall impact of over four times on the total principal amount due to imposition of interest, penalty and interest on penalty. Its senior counsel AM Singhvi told the court that the company was fully compliant with the order and had paid over 10% of its pending AGR dues of over `18,000 crore.

Submitting that its payments and deductions not considered by the DoT were “purely by oversight,” the company made it clear that it can’t be asked to pay the amount again due to errors.

Claiming that it was not blaming the DoT or seeking a review of the court verdict, Vodafone Idea also said it was not seeking any reassessment of the calculations, but only seeking correction in these arithmetical errors. Terming “rectification” as a matter of right in any assessment or reassessment, Tata Teleservices said the judgment only prohibited reassessment and not rectification of calculative errors.

However, solicitor general Tushar Mehta informed the SC that he had not received any instructions from the DoT on claims of “arithmetic errors” in AGR calculations.

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