Vodafone Idea Limited
The Supreme Court on Monday deferred hearing on the petition of Vodafone Idea, in which the company challenged the AGR dues in addition to ₹ 9,450 crore sought by the Department of Telecommunications (DOT). Before the court hearing was postponed, the company’s shares had seen a decline of about 5%. But as soon as the news came that the hearing had been postponed, the shares were a little careful and about 2% climbed to ₹ 8.49. Now the next hearing of this case will be held on 13 October. On behalf of Vodafone Idea, senior advocate Mukul Rohatgi appeared, while Solicitor General Tushar Mehta appeared on behalf of the central government. Both had requested the court to postpone the hearing of the case by next Monday.
What is AGR case?
AGR i.e. Adjusted Gross Revenue i.e. that part of the total earnings of telecom companies, on which the government has to pay the license fee and the rest of the charge. In fact, telecom companies earn not only from mobile networks but also from other services. Earlier, these companies used to pay fees only on the earnings from the network, but in 2019, the Supreme Court ruled that they will have to pay the government’s fees on all their earnings (whether they are related to telecom or not). After this decision, a big quarrel started between the government and the telecom companies over the outstanding money.
What does Vodafone Idea say?
Vodafone Idea says that she has repaid the outstanding arrears. But now the additional amount of ₹ 9,450 crore is being sought, it is still in controversy and the government has not even finalized it. The company has appealed to the Supreme Court that until the real arrears are fixed, it should not be considered a defaulter and no fine.
Vodafone Idea has recently made a new demand from the Supreme Court, changing its petition. The company has asked the court to waive interest and fine on the outstanding amount. The company has cited an old decision of the Supreme Court for this, in which the government was given relief from tax in some cases. Vodafone Idea argues that if the government can get such relief, then companies should also get it.
Apart from this, Vodafone Idea also said that both the government and the company have agreed that the figures of the outstanding amount have yet been fully mixed and not investigated. In such a situation, it is not right to suppress it under the burden of fine or interest until the exact amount is fixed. The company clearly says that until the whole account is not clear, we should not be considered a defaulter and protected from strict action.
What did the government say?
On behalf of the government, Solicitor General Tushar Mehta said in the Supreme Court that now the government itself is part of the Vodafone Idea. Therefore, this matter is not only about a company, but also with crores of customers and thousands of employees. He appealed to the court that the matter should be heard soon so that the solution can be found soon and no one is harmed.
The government admitted that there is a huge economic pressure on Vodafone Idea due to this dispute. The company said that it owes a total of about ₹ 83,400 crore and every year it has to pay around ₹ 18,000 crore. It has become very difficult for the company to pay this amount.
The company’s closure threat
The company has clearly stated that if this matter is not resolved soon, then there is a danger of the company being closed. This will not only affect the Vodafone idea, but will also danger the jobs of more than 18,000 employees. Not only this, the services of about 19.8 crore (198 million) mobile users across the country can also be affected. On the other hand, the Department of Telecommunications (DOT) said that the amount of interest and fine in the arrears so far can increase the amount to ₹ 6,800 crore.