SC settles 14-yr-old AGR dispute; asks telcos to pay Rs 92k crore to govt
The Supreme Court on Thursday favoured the government by allowing the Centre to recover Rs Adjusted Gross Revenue (AGR) of Rs 92,000 crore from telecom companies. The decision ended the 14-year-old battle between the mobile operators and the government but pulled down the telco stocks sharply.
After the verdict, Bharti Airtel’s stock fell 4.9 % and Vodafone Idea dropped 13.3%. The ruling was made by Justice Arun Mishra, AA Nazeer and MR Shah. The court said that the amount will be recovered in the form of a licence fee and penalty along with interest-based on the revenue-sharing model for the gross revenue of 14,98,181 crore earned by them during 2004-2015.
A disappointed Bharti Airtal released a statement said that the decision has come at a time when the sector is facing severe financial stress and may. It stated, “The Telecom Service Providers (TSP) have invested billions of dollars in developing the sector and providing world-class services to consumers. The decision will further weaken the viability of the sector as a whole.”
It may be noted that the sector has been under immense financial stress and out of 15 only Bharti Airtel and Vodafone Idea remain operational. Experts of the field feel that he apex court’s decision will dampen the sentiment of telecom operators and raising funds for broadband, network expansion and Digital India will hit be affected.