SC Jolt To Telecom Companies: Centre To Recover Rs 1.33 Lakh Cr In Dues

The Supreme Court on Thursday dealt a huge blow to telecom firms Bharti Airtel, Vodafone-Idea and Reliance Communications after ruling in favour of the government to recover dues worth Rs 1.33 lakh crore. The verdict will completely drain the Vodafone Idea Ltd's entire cash balance of about Rs 21000 crore at the end of June.

A three-judge bench led by Justice Arun Mishra pronounced the judgment in the 14-year-old case which had the mobile operators locked in a legal battle with the Department of Telecommunications over the definition of the Adjusted Gross Revenue (AGR). The SC ruled that it will uphold the definition put forward by the DoT.

The DoT has claimed licence fee dues of around Rs. 92,000 crore and Rs. 41,000 crore as spectrum usage fee from the three telecom companies.

Bharti Airtel owes Rs 21,682.13 crore, Vodafone Idea owes Rs 19,823.71 crore while Reliance Communications owes a total of Rs 16,456.47 crore, according to the DoT.

Following the SC order, Vodafone shares plunged as much as 19%, while Bharti Airtel tanked over 8%.

Airtel said in a statement, “We are disappointed by the verdict of the Hon’ble Supreme Court...This decision has come at a time when the sector is facing severe financial stress and may further weaken the viability of the sector as a whole."

"The Government must review the impact of this decision and find suitable ways to mitigate the financial burden on the already stressed industry," the statement added.

The apex court will later decide on the timeframe for the operators to pay AGR.

Meanwhile, the telecom companies sought six months for clearing the dues.