No loss in Jio billing, says BSNL as it counters CAG’s ₹1,757-crore finding

State-owned BSNL is preparing to submit a detailed rebuttal to the Department of Expenditure (DoE), firmly contesting the Comptroller and Auditor General’s (CAG) claim that BSNL suffered a revenue loss of ₹1,757.76 crore due to the non-billing of Reliance Jio Infocomm Limited (RJIL) for shared telecom infrastructure, according to a report by ET Telecom.

In its forthcoming submission, BSNL argues that the loss has been “erroneously overestimated” due to misrepresentation and an incorrect application of clauses related to add-on components in its Master Service Agreement (MSA) with Jio. According to the ET Telecom report, the operator maintains that there has been no actual revenue loss, and that the amount cited by the CAG is not reflective of the reciprocal nature of the infrastructure sharing arrangement.

Disputing CAG’s Findings

The CAG, in its audit report, alleged that BSNL failed to enforce key provisions of the MSA from May 2014 to March 2024, particularly regarding additional technology deployed by Jio on BSNL’s passive infrastructure. This non-enforcement, according to the auditor, led to a notional loss of ₹1,757.76 crore, along with applicable penal interest. The report also flagged non-application of escalation clauses, estimating a further ₹29 crore loss, including GST.

However, BSNL insists that it had already raised invoices totalling ₹108 crore to Jio, and is actively pursuing additional dues beyond the standard base rental. The company further claims that the rates for additional hardware, power, and the use of both TDD and FDD 4G technologies were finalised in April 2018.

To formalise this arrangement, an addendum to the MSA was signed on 31 January 2025, outlining the applicable charges for extended 4G usage. BSNL says this addendum is in compliance with the Centre’s broader policy that supports infrastructure sharing among telecom operators to reduce capital and operational expenditure.

Reciprocal Agreement, Not Oversight

Sources quoted by ET Telecom suggest that the CAG may have overlooked the reciprocal nature of BSNL’s agreement with Reliance Jio. Under this arrangement, infrastructure sharing was not a one-way service, and terms were mutually agreed upon, especially for add-on technology requirements beyond the standard configuration.

BSNL has historically partnered with multiple private sector players—Reliance Jio, Bharti Airtel, and Vodafone Idea—to monetise its tower assets. In 2014, the company entered into formal telecom infrastructure sharing agreements with these operators to optimise resource utilisation.

Former Communications Minister Ravi Shankar Prasad, speaking in the Rajya Sabha in February 2020, confirmed that out of 13,146 BSNL mobile towers, 8,363 were shared with Jio, 2,779 with Bharti Airtel, and 1,782 with Vodafone Idea. He clarified that no fixed income was transferred from BSNL to Jio under this setup.

Payment records further indicate that Reliance Jio made significant annual payments to BSNL: ₹171.81 crore in 2016–17, ₹472.80 crore in 2017–18, ₹678.38 crore in 2018–19, and ₹402.28 crore for the first three quarters of 2019–20.

BSNL is expected to submit its comprehensive response to the Department of Expenditure later this month, once all internal approvals are completed. The state-run telco maintains that it has adhered to all contractual obligations and that the CAG’s conclusions do not accurately reflect the operational and financial realities of the agreement.