Relief for Vodafone: Supreme Court permits Centre to reassess telecom operator’s AGR dues; check details

The Supreme Court on Monday allowed the Centre to reconsider the assessment of telecom operator Vodafone’s adjusted gross revenue (AGR) dues, citing the interest of the company’s 20 crore consumers. The SC also noted that the matter falls within the Union government’s policy domain.A bench headed by Chief Justice of India BR Gavai passed the order after being informed by Solicitor General Tushar Mehta that the government had infused equity to the extent of 49% in the telecom company. He said concerns for over 20 crore consumers drove the move.“The government has infused equity to the extent of 49%. There are 20 crore consumers. That was one of the reasons for which the government took this decision. The consumers would suffer … they have concerns, something duplicate billing, some over-invoicing etc, this what I have proposed,” Mehta told the court, as quoted by ET.CJI Gavai said, “We clarify that this is in the policy domain of the Union… there is no reason as to why that Union should be prevented from doing that. With that view of the matter, we dispose of the writ petition.” He further clarified that the order was being passed specifically because of the equity infused by the Centre and the interest of its nationwide consumer base.Following the ruling, Vodafone Idea’s stock staged a strong rebound.

A long legal battle

Vodafone Idea has been entangled in litigation over its AGR dues for several years. On October 13, the Supreme Court deferred hearing on the company’s plea seeking exemption from paying interest, penalties, and related charges on its AGR dues raised by the department of telecommunications (DoT). The operator had also contested a fresh DoT demand of Rs 5,606 crore for FY 2016–17.Earlier, the Centre informed the apex court that discussions were ongoing to resolve the matter, emphasising that the government—now owning nearly half the company’s equity—had a direct stake in its continuity. Vodafone Idea had also requested the DoT to “comprehensively re-assess and reconcile all AGR dues for the period up to FY 2016–17 following the ‘Deduction Verification Guidelines’ dated February 3, 2020,” as quoted by ET.