The Department of Telecommunications (DoT) will not take any coercive action against the incumbent operators in case they default on the Adjusted Gross Revenues (AGR) dues as the deadline expired on Thursday.
The telecom licensor, which is in the process of preparing a compliance report on operators’ dues, will await a final ruling from the Supreme Court before further action.
“You are directed not to take any coercive action against the licensees in case they fail to comply with the Supreme Court order, until further orders,” an internal note by DoT’s Licensing Finance Policy Wing said.
According to legal experts, a delay of a couple of days, that is, if the operators are to pay AGR dues next week or till the Supreme Court gives a deadline, would not constitute a contempt of court.
“We are very grateful to DoT for having taken (a) positive step and waiting till the Supreme Court takes a final decision. This eases pressure on the industry and we will wait for the court’s final decision,” Rajan S Mathews, Director-General of Cellular Operators Association of India, said.
In its order on October 24, 2019, the apex court dismissed operators’ plea seeking a review of what constituted AGR and ruled that the firms have to pay AGR dues within three months. The telecom operators including incumbents Bharti Airtel and Vodafone Idea, will have to cough up nearly ₹1.3-lakh crore as AGR dues.
Mukesh Ambani-controlled Reliance Jio Infocomm (RJio) paid ₹195 crore as AGR dues on Thursday.
RJio, a wholly-owned subsidiary of Reliance Industries Ltd, had earlier provisioned ₹177 crore for AGR payments.
On its part, Bharti Airtel has written a letter to DoT stating that it will comply with the Supreme Court order, but requested the licensor to wait till the apex court’s hearing next week. Vodafone Idea is also believed to have sought extension till the Supreme Court’s order is given.
On January 20, telecom companies had approached the Supreme Court yet again on the AGR issue, this time seeking an extension of the January 23 deadline to pay the dues. The companies, which had posted huge losses in the second quarter due to AGR provisioning, are also seeking waiver of the penalties.
The Supreme Court also agreed to hear the modification petition next week, even though it did not fix a date.