Telecom industry badly needs relief measures

New Delhi: Industry body Cellular Operators' Association of India (COAI) on friday said the government is well aware of implications of leaving the stressed telecom sector without a relief package, as it urged policymakers to use "tools" available to find appropriate solutions expeditiously.

"The industry is in urgent need of relief measures, and we urge the government to come up with appropriate solutions expeditiously and resolve the matter," Cellular Operators' Association of India (COAI) Director General Rajan Mathews said.

On wednesday, the apex court rejected the telcos' self-assessed adjusted gross revenue (AGR) dues and ordered them to pay the principal together with interest and penalties.

It stated that non-payment of dues would tantamount to contempt of court.

"The government can exercise the tools that are available and move forward on that basis," Mathews said.

Telecom companies such as Bharti Airtel, Vodafone Idea and Tata are in a bind as their combined self-assessment of dues to the government are a whopping Rs 82,300 crore short of what the telecom department calculated after the Supreme Court's ruling on AGR.

The apex court has lashed out at the telcos for trying to reopen the dues they owed to the government through the self-assessment exercise.

A bench of Justices Arun Mishra, S A Nazeer and M R Shah refused to take up the Centre's plea for allowing telecom companies to pay AGR dues in 20 years, saying the application will be taken up after two weeks.

"The timeframe of 20 years is unreasonable. The telecom companies have to clear all dues mentioned in the judgment," the bench said adding that it had settled all AGR dues after hearing telecom companies and the government then had fought tooth and nail for interests and penalties.

The Department of Telecommunications (DoT), according to its own submission to the apex court recently seeking relief in payment tenure, has put dues of the three companies Bharti Airtel, Vodafone Idea and Tata Group at Rs 1.19 lakh crore.

The dues estimated by DoT for Bharti Airtel and Telnor stood at Rs 43,980 crore, while that of Vodafone Idea was Rs 58,254 crore, and Tata Group of companies at Rs 16,798 crore outlined under "total demand of DoT incorporating CAG and special audit as on October 2019".

These dues arose after the Supreme Court, in October last year, upheld the government's position on including revenue from non-core businesses in calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer.