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Supreme Court: Order Reserved on AGR Dues of Insolvent Telcos

AGR dues

The SC of India reserved its order regarding the recovery of adjusted gross revenue (AGR) dues of insolvent telecom companies. As per the apex court, it will further clarify the additional liabilities, if any. As per the final judgment of the SC, Reliance Jio and Bharti Airtel pay the past dues of the spectrum they purchased from Reliance Communications, Videocon, and Aircel, respectively.

The apex court stated that if the spectrum seller has not clear its dues before selling it, the buyer is liable to pay for the contributions as per the trading guidelines. TSP is responsible for the prices, deferred, installment of the spectrum. The court also stated that TSP is also accountable for the AGR dues, including spectrum usage, charges, and license fees.

If the SC orders telcos to pay the past dues of the bankrupt companies’ spectrums, both Airtel and Reliance Jio will hit hard. The Aircel owes, 12,289 crore INR in AGR dues, the liability of Videocon is 1,376 crore INR. The Reliance Communication has the due of 25,199 crore INR.

AGR Dues to be Calculated as per Spectrum Agreements of Telcos

Earlier today, the department of telecommunication (1) filed an affidavit to the SC. The affidavits state that AGR dues of the insolvent tele companies have to be calculated by spectrum sharing and trading. Two telecom service providers sign such agreements.

The bench of three judges, overseen by Justice Arun Mishra, stated that the telecom service provides cannot sell the spectrum. The spectrum is government property. It will allow dues to be cleaned if buyers purchase the range without liabilities. It is not permissible to clear out the contributions of the government. Mishra also said that we would cancel the spectrum allocation if companies are not willing to pay.

The bench asked the DoT to submit an assessment of the quantifiable dues from 2016. As per the General of DoT, the evaluation is currently under process. The crystallization of the AGR dues by DoT came only after the judgment in October 2019.