India’s top court on Tuesday gave telecom firms 10 years to pay back dues they owe to the federal government after they failed to make the payment by the January deadline.
Telecom providers in India pay the Department of Telecommunications (DoT) nearly three to five percent of their adjusted gross revenue (AGR) in usage charges for spectrum or airwaves and eight percent of AGR as licence fees, but they have been at odds on the definition of AGR.
The decision would provide some respite to embattled Vodafone Idea, a joint venture between Britain’s Vodafone and India’s Idea, even though it had asked the court for 15 years to complete payments.
The Supreme Court, however, asked that telecoms firms pay 10 percent of the dues owed by March 31, 2021.
Vodafone Idea, seen as the most vulnerable if the court did not allow for staggered payments, has so far paid Rs. 7,854 crores, but still owes roughly Rs. 50,000 crores to the government.
Bharti Airtel has said it has paid its complete dues of Rs. 18,000 crores on the basis of self-assessment, but still needs to pay another Rs. 25,796 crores, according to government calculations.
Shares in Vodafone Idea were down 14.7 percent, while Bharti was up 5.3 percent at 06:23 GMT.
© Thomson Reuters 2020
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