Supreme gives big relief to telecom companies, internet and calling prices will no longer go up
In the case of Adjusted Gross Revenue (AGR), the Supreme Court has given a major relief to telecom companies. They have got 10 years to pay the AGR arrears. This is a big relief especially for Vodafone Idea, Airtel.
Significantly, Judge Mishra is retiring on Wednesday 2 September i.e.. The court said the decision would be on three grounds. First, whether telecom companies are allowed to pay AGR debts in pieces to pay AGR arrears, secondly - how to recover the arrears of companies facing bankruptcy proceedings and thirdly - whether it is legal to sell the spectrum of such companies.
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Vodafone Idea and Bharti Airtel had sought 15 years to pay the AGR arrears. So far, 15 telecom companies have paid only Rs 30,254 crore, while the remaining Rs. 1.69 lakh crore.
What is AGR?
Adjusted Gross Revenue (AGR) is the usage and licensing fees charged by telecom companies through the Department of Telecommunications (DOT) of the Ministry of Communications. It has two parts - spectrum usage charges and licensing fees, which are 3 to 5% and 8%, respectively.
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In fact, the Department of Telecommunications states that AGR should be calculated based on the total revenue or income of a telecom company, including the income from non-telecom sources, such as deposit interest and asset sales.
Telecom companies also said that AGR should be calculated on the basis of revenue from telecom services. But last year, the apex court ruled against the telecom companies and asked them to pay the AGR immediately. The total arrears of about 15 telecom companies are about Rs 1.69 lakh crore.
