Vodafone Idea Files Plea In SC Seeking Correction Of AGR Dues

Vodafone Idea has recently filed a curative petition in the Supreme Court in relation to judgment that had dismissed pleas by telecom companies seeking correction of errors in Adjusted Gross Revenue dues payable by them.

Senior advocate Harish Salve mentioned before a bench of Chief Justice of India DY Chandrachud and Justices JB Pardiwala and Manoj Misra that a curative petition has been filed.

Salve told the bench, “This court has said there are arithmetical errors and this is a curative plea.”

In September 2020, the Supreme Court granted telecom companies a period of 10 years to clear their pending AGR dues to the Central government, with a 10% payment to be made every year.

The deadline given to the telcos for the 1st instalment was March 31, 2021.

In the year 2021, the Supreme Court dismissed the plea of telecom majors, including Bharti Airtel and Vodafone Idea, seeking correction of errors in calculation of AGR dues payable by them as per the top court’s 2019 judgement.

Therefore, the companies submitted that the Department of Telecom have made arithmetical errors in calculation of AGR dues and wanted the Court to allow rectification of errors.

The total liability on Vodafone-Idea was Rs. 58,254 crore, while Bharti Airtel was to pay Rs. 43,980 crore.

In its curative plea, Vodafone India stated that it seeks to challenge only the 2 directions of the top court and it is not challenging or questioning the imposition of license fee on them as defined by the court.

The first challenge, the company said was to the direction of the top court where it stated that “demands made by the DoT would be final and that even the manifest/clerical/arithmetical errors in the computation of dues could not to be rectified and the licensees would be compelled to make payment of the tentative/provisional show-cause cum demands raised by the DoT.”

The plea stated that the 2nd direction challenged by the telecom company was the top court’s order that the “licensees would be liable to pay penalty of 50 per cent of the entire amount of short-payment and interest on the said penalty at a rate which will be 2 per per cent above the prime lending rate of State Bank of India and that too compounded monthly (In addition to interest for delayed payment which itself being very high is penal in nature).”

The curative plea stated that since the petitioner is already bearing an excessively high rate of interest on delayed payment which is akin to penalty, it should not be further burdened with penalty and interest on penalty.

The petition stated, “It may be considered that the telecom industry is currently going through a critical phase and it is essential that it is not burdened with such exorbitant penalty in addition to penal interest.”

It added, “The Petitioner is already at the verge of a financial crisis, which threatens its very existence and the judgment passed by this Court prohibiting even the corrections of clerical and arithmetical errors in the demands, foreclosing any reduction of the amount payable by thousands of crores of rupees and further imposing a penalty and interest on penalty, is highly unjust.”