Govt drops 96% AGR demand from PSUs

7 months ago 39
google news

NEW DELHI: A week after being slammed by the Supreme Court for “unreasonably” seeking over Rs 4 lakh crore from various PSUs on the basis of its verdict on adjusted

gross revenue

(AGR) for private telecom companies, the

Centre

on Thursday informed the apex court that it has decided to withdraw 96% of the demand.
Appearing before a bench of Justices Arun Mishra, S

Abdul Nazeer

and M R Shah, Solicitor General

Tushar Mehta

informed the court that the government had reconsidered its demand as asked by the court and the “dues” of AGR would be taken back. The department of telecommunication (DoT) faced the ire of the apex court on June 11 for raising the demand from PSUs.
The court also asked private telecom companies, including Bharti Airtel and Vodafone Idea, to come up with a “reasonable plan” to pay their AGR dues of around Rs 1.69 lakh crore and asked them to file their books of accounts for the last 10 years. The court said they have to pay as it is public money, but agreed to consider fixing a time frame for depositing the amount as sought by these companies. It fixed the next hearing in the AGR dues case for third week of July.
Senior advocate A M Singhvi, appearing for Airtel, told the bench that it had deposited the amount due on it according to its calculation and the company could resolve the differences with the government on the exact amount.
Vodafone’s counsel

Mukul Rohatgi

said the company is facing financial problems and it is not even in a position to furnish a bank guarantee for the amount. He said the company had not made even a penny of profit in the last five years and it can survive only if it was allowed to pay the AGR dues in instalments. He said the worth of the company’s assets is around Rs 42,000 crore but its liability stood at Rs 1 lakh crore.
The court, however, wanted to ensure that the companies clear their dues and asked whether the directors of the firms could give undertaking to pay the amount. But Rohatgi said the amount is too big for a person to give an undertaking.
As most of the telecom companies expressed inability to clear the dues at one go or to provide bank guarantees, the bench decided to examine their earnings in the last 10 years and directed them to place before it their audited account books.
The court said it could grant time to the companies to clear their dues but they must pay a certain amount initially to show their bona fide.
On October 24, the SC had allowed the Centre to recover around Rs 1.69 lakh crore as licence fee and penalty along with interest based on the revenue-sharing model from 2004 to 2015 from telecom operators. It had dismissed the companies’ plea that AGR, on the basis of which fee is paid by them to the Centre, should include only core telecom services and revenue from other sources should be excluded.

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