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AGR case: Supreme Court to pronounce verdict tomorrow

Justice Arun Mishra-led three-judge bench will pronounce its judgment on adjusted gross revenue (AGR) case at 11:30 am on September 1

twitter-logoBusinessToday.In | August 31, 2020 | Updated 22:25 IST
AGR case: Supreme Court to pronounce verdict tomorrow
Justice Arun Mishra is due to retire on September 2

The Supreme Court will pronounce its judgment on 14-year-old Adjusted Gross Revenue (AGR) case on September 1. Justice Arun Mishra-led three-judge bench will deliver its verdict on the timelines for payment of AGR dues by telecom companies to the government at 11:30 am on Tuesday.

Justice Mishra, who became judge in Supreme Court on 7 July 2014, will retire on September 2.

The bench has outlined three areas on which it would pass the judgement. These parameters include timeline for the staggered payment schedule on AGR dues by telcos, decision on recovery of AGR related dues from telecom companies facing insolvency proceedings, and whether spectrum given to these companies can be sold.

While the Department of Telecommunications (DoT) had sought a 20-year time frame for payment of AGR related dues, incumbent telcos Vodafone Idea and Bharti Airtel had sought 15 years for the same. As of now, out of 15 affected telcos, five have paid just a fraction - about Rs 30,254 crore - of the AGR dues to DoT out of the total demand of Rs 1.69 lakh crore.

The second part of the SC's judgement will ascertain the AGR liability of the telcos - Jio and Airtel - for the spectrum deals that they have done with the insolvent telcos. Jio, for instance, went into a spectrum trading and sharing agreement with RCom in 2016 where Jio had bought airwaves in the 800 megahertz band from RCom in 13 circles in addition to sharing spectrum in the same band in some other circles. Airtel, on the other hand, had spectrum sharing and trading agreements with Aircel and Videocon Telecom.

The third major area on which the court will announce its judgment is whether telcos can transfer the spectrum rights, and sell it under Insolvency and Bankruptcy Code (IBC). This mostly applies to three operators that have become insolvent, namely Reliance Communications, Aircel and Videocon Telecom. While Mukesh Ambani-led Reliance Jio had spectrum sharing agreements with his younger brother Anil Ambani's RComm, Bharti Airtel had inked similar pact with Videocon and Aircel.

In October 2019, the apex court had delivered the verdict on the AGR issue for calculating government dues of telecom companies such as licence fee and spectrum usage charges. Last year, the apex court had upheld the government's broader definition of AGR.

By Chitranjan Kumar

Also Read: Supreme Court puts onus of AGR dues of ailing telcos on spectrum users

Also Read: AGR case: Supreme Court fears telco dues will be wiped out in IBC process

Also Read: AGR case: Why shouldn't Jio pay RCom dues, SC asks

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