AGR: SC Dismisses Review Pleas By Telecom Companies

The Supreme Court dismissed the review petitions filed by telecom companies seeking relief on payment of Adjusted Gross Revenue (AGR).

The Review petitions were taken up for hearing and deliberations in chamber by the Bench of Justices Arun Mishra, S Abdul Nazeer, and MR Shah. The Court held,

Having perused the Review Petitions and the connected papers with meticulous care, we do not find any justifiable reason to entertain the review petitions. The Review Petitions are, accordingly, dismissed.-Supreme Court

In the judgment rendered in October last year, a Bench of Justices Arun Mishra, Abdul Nazeer, and MR Shah ruled that the Department of Telecom’s (DOT) interpretation of Adjusted Gross Revenue would prevail.

This came as a massive blow to telecom service providers given that the DoT’s interpretation brought under its scope most of the revenues “except one or two” causing severe financial implications to the telecom players such as Bharti Airtel and Vodafone, among others.

Owing to this judgment, a total of about Rs 92,000 Crores were to be paid by the service providers, cumulatively, to the government.

Telcom majors moved the Apex Court thereafter seeking a review of this judgment claiming that this ruling would have severe financial implications and would also have an adverse impact on the economy.

On January 8, Senior Lawyers Kapil Sibal, and Abhishek Manu Singhvi, representing these companies sought an urgent hearing of the Review Petition and mentioned the matter before the Bench headed by Justice Arun Mishra. The urgency is prompted by the fast approaching deadline of January 23, by which date, the telcos are required to discharge their dues.

On the request made for an open Court hearing of the matter, Justice Mishra had directed the lawyers to return on Thursday saying that a call would be taken on the same after discussion with Chief Justice of India, SA Bobde, who is the master of the roster.

Vodafone, in its plea has evaluated the industry-wide impact of the judgment to the tune of approximately Rs. 1,80,000 Crores. The Scope of this judgment goes beyond the telecom sector and is likely to have a “crippling effect” on the economy given that Adjusted Gross Revenue is also an expression used by DoT in granting licences to Railways, Cable Operators, other public undertaking, Vodafone adds in its Review petition.

The crippling blow rendered by the Judgment under Review will, therefore, impact the larger economy and many other industries as well.-Vodafone, in its Review petition

Terming the circumstances to be “exceptional” in nature, a Review of the ruling is sought on the grounds that various aspects and findings by expert bodies have escaped the consideration of the Court in its judgment.

Vodafone further claims that owing to this judgment, the company is “on the brink of financial insolvency” and the judgment would have a “mortal impact” on the telecom industry.―Bar And Bench