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Govt asks Vodafone Idea, Airtel to submit self-assessment documents on AGR arithmetic

All three telecom companies Bharti Airtel, Vodafone Idea and Tata Teleservices have been asked to provide substantiating documents to support their claims on AGR arithmetic

twitter-logo PTI   New Delhi     Last Updated: February 24, 2020  | 21:26 IST
Govt asks Vodafone Idea, Airtel to submit self-assessment documents on AGR arithmetic
DoT wants to ensure that the court-mandated criteria is being followed by companies in computing their AGR dues

The government has asked telecom companies including Vodafone Idea, Bharti Airtel and Tata Teleservices to submit supporting documents on AGR self-assessment that formed the basis of their statutory dues calculation, according to a DoT source.

The source, who did not wish to be named, said the exercise will help the Department of Telecom (DoT) examine the AGR calculations being made by the telecom players.

All three telecom companies Bharti Airtel, Vodafone Idea and Tata Teleservices have been asked to provide substantiating documents to support their claims on AGR arithmetic, the DoT official added. However, no deadline has been given to companies to submit the supporting documents.

Once substantiating documents are filed by the companies, the telecom department will initiate random test checks on the AGR calculation in a time-bound manner. The 'test check' will be done for any one year (of telcos' dues) to examine the deviation between telecom companies' assessment and the government calculation of AGR liabilities.

Asked what prompted the department to seek supporting documents to verify AGR-math done by companies through self-assessment, the source equated the exercise to filing of income tax returns where the assessing authority examines the calculations/claims made.

Moreover, the DoT wants to ensure that the court-mandated criteria is being followed by companies in computing their AGR dues, the source added.

Also Read: Nobody wants to kill telecom sector: SBI chief on AGR

While the three operators - Bharti Airtel, Vodafone Idea and Tata Teleservices - are first off the block, the DoT will also follow the same procedure for all other AGR-hit companies including internet service providers.

"For those who are saying we are giving dues by self-assessment, we will seek supporting documents. If some companies say they are going by DoT's calculation, then we don't need to do it," the source added.

In all, 15 entities owe the government Rs 1.47 lakh crore in unpaid statutory dues -- Rs 92,642 crore in unpaid licence fee and another Rs 55,054 crore in outstanding spectrum usage charges. Of the estimated dues that include interest and penalty for late payments, Airtel and Vodafone Idea account for about 60 per cent.

Also Read: Decision to encash bank guarantees 'disastrous' for telecom industry: COAI

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 Adjusted Gross Revenue (AGR) of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer.

The Supreme Court earlier this month rejected a plea by mobile carriers such as Bharti Airtel and Vodafone Idea for extension in the payment schedule and asked companies to deposit their past dues for spectrum and licences.

Since the February 14 tongue-lashing Supreme Court gave telecom companies for missing its previous deadline of January 23 to pay past dues as well as the Department of Telecommunication for failing to enforce it, firms and Telecom Ministry are busy doing separate maths on the actual dues.

Vodafone Idea, which is confronted with Rs 53,000 crore in statutory dues as per DoT's calculation, has so far paid only seven per cent of those dues in two tranches.

Airtel has paid Rs 10,000 crore out of its DoT estimated liability of over Rs 35,000 crore.

Airtel on February 17 had said that the company "is in a process of completing the self-assessment exercise expeditiously and will make the balance payment upon completion of the same, before the next date of hearing in the Supreme Court".

Tata Teleservices has paid Rs 2,197 crore, the entire outstanding it believes to have arisen after the October ruling of the apex court for calculating dues.

Amid a deepening crisis in the telecom sector, the government is looking to strike a balance between complying with the Supreme Court order on AGR dues, ensuring the health of the sector and safeguarding consumer interest.

Both Bharti Airtel Chairman Sunil Mittal and Vodafone Idea Chairman Kumar Mangalam Birla continued to meet top government functionaries throughout last week to seek prompt measures that would offer a breather to the troubled sector.

Mittal has urged the government for reduction in levies and taxes, as he termed the AGR "an unprecedented crisis for industry".

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