Vodafone Idea's, Adjusted Gross Revenue (AGR) dues of Rs 70,300 crore will require urgent government intervention, according to Vodafone Idea Limited (VIL), the telecom operator that incurred these high AGR dues. After the Supreme Court rejected its plea for re-evaluation of its AGR dues recently, it has started afresh dialogue with government officials about its possible remedies as detailed in a report by the Press Trust of India. 

The challenge posed by AGR dues<o:p></o:p>

The apex court has rejected the plea of Vodafone Idea on 19 September 2024 to re-calculate its AGR liabilities, which account for as much as 33 per cent of the debt. The company is of the view that only telecom revenue should be taken into account in such calculations and not the non-telecom revenue. Yet, with this latest jolt, the CEO, Akshaya Moondra, appears optimistic about the long-term turnaround strategy of the company and calls upon government support during such financial turmoil.

According to Moondra, "Our merits on AGR dues are pretty strong," which means that the company is quite confident about the strength of its case for relief. That in itself speaks to how important these discussions with the government are. Further, an executive mentioned that, if there were any re-examinations, that would have to come from the government.

Financial outlook and Strategic moves<o:p></o:p>

Vodafone Idea has an integrated plan for managing cash flow and reducing debt during a tussle with its financial liability. The telecom firm is looking to clear the government dues and outstanding dues against banks and vendors through operational cash flows. 

Vodafone Idea Limited’s payment obligation to the government stood at Rs 2,09,520 crore as of June 30, 2024, including deferred spectrum payment obligations of Rs 1,39,200 crore and AGR liability of Rs 70,320 crore.

Further, Vodafone Idea recently kick-started a series of significant capital expenditure plans worth Rs 55,000 crore for the next three years as a strategic move to improve its financial position. The money would be spent majorly on enhancing its 4G network in preparation for nationwide 5G rollouts in all priority circles across India.

Market reactions and future prospects<o:p></o:p>

Despite the hurdle, Vodafone Idea witnessed a minuscule rise in its stock after reports that the company is holding negotiations with the government and expansion plans for the network. Analysts are divided in the future potential of the company. Some are of the opinion that it cannot survive without more support while others have huge hopes for strategic initiatives. Brokerages have pointed out that in the absence of relief on AGR dues, Vodafone Idea may face significant financial pressure as early as FY26 when relatively large payments would come due. It is hence to be seen how the government handles the situation and supports the debt-ridden Vodafone Idea to fulfil its obligations.

<o:p>&nbsp;</o:p>

Vodafone Idea's, Adjusted Gross Revenue (AGR) dues of Rs 70,300 crore will require urgent government intervention, according to Vodafone Idea Limited (VIL), the telecom operator that incurred these high AGR dues.

Vodafone Idea's, Adjusted Gross Revenue (AGR) dues of Rs 70,300 crore will require urgent government intervention, according to Vodafone Idea Limited (VIL), the telecom operator that incurred these high AGR dues. After the Supreme Court rejected its plea for re-evaluation of its AGR dues recently, it has started afresh dialogue with government officials about its possible remedies as detailed in a report by the Press Trust of India. The challenge posed by AGR dues The apex court has rejected the plea of Vodafone Idea on 19 September 2024 to re-calculate its AGR liabilities, which account for as much as 33 per cent of the debt. The company is of the view that only telecom revenue should be taken into account in such calculations and not the non-telecom revenue. Yet, with this latest jolt, the CEO, Akshaya Moondra, appears optimistic about the long-term turnaround strategy of the company and calls upon government support during such financial turmoil. According to Moondra, "Our merits on AGR dues are pretty strong," which means that the company is quite confident about the strength of its case for relief. That in itself speaks to how important these discussions with the government are. Further, an executive mentioned that, if there were any re-examinations, that would have to come from the government. Financial outlook and Strategic moves Vodafone Idea has an integrated plan for managing cash flow and reducing debt during a tussle with its financial liability. The telecom firm is looking to clear the government dues and outstanding dues against banks and vendors through operational cash flows. Vodafone Idea Limited’s payment obligation to the government stood at Rs 2,09,520 crore as of June 30, 2024, including deferred spectrum payment obligations of Rs 1,39,200 crore and AGR liability of Rs 70,320 crore. Further, Vodafone Idea recently kick-started a series of significant capital expenditure plans worth Rs 55,000 crore for the next three years as a strategic move to improve its financial position. The money would be spent majorly on enhancing its 4G network in preparation for nationwide 5G rollouts in all priority circles across India. Market reactions and future prospects Despite the hurdle, Vodafone Idea witnessed a minuscule rise in its stock after reports that the company is holding negotiations with the government and expansion plans for the network. Analysts are divided in the future potential of the company. Some are of the opinion that it cannot survive without more support while others have huge hopes for strategic initiatives. Brokerages have pointed out that in the absence of relief on AGR dues, Vodafone Idea may face significant financial pressure as early as FY26 when relatively large payments would come due. It is hence to be seen how the government handles the situation and supports the debt-ridden Vodafone Idea to fulfil its obligations.

Vodafone Idea seeks Government relief in AGR duress crisis

In a big setback for telecom companies, the Supreme Court on Friday dismissed their plea seeking correction of alleged errors in Adjusted Gross Revenue (AGR) calculation. 
 
A bench headed by Justice L&nbsp;Nageswara Rao said all applications were dismissed. On Monday, the apex court already said it would pass its order on applications filed by, Vodafone Idea, Bharti Airtel and Tata Tele Services Ltd, alleging arithmetical errors in the calculation of AGR dues payable by them. 
 
The top court, citing an earlier order in the matter, had noted the order clearly point out that no re-assessment of AGR related dues can be done. The telcos submitted that arithmetical errors can be rectified and there are cases of duplication of entries.

Also read |&nbsp;Will not hear arguments on reassessment of AGR related dues "even for a second": SC to telcos 
 
Senior advocate Mukul Rohatgi, representing Vodafone Idea, had submitted they were not blaming the Department of Telecommunications (DoT) for it, and there are arithmetical entries. Rohatgi added that they want to bring these errors to the attention of the concerned department, for their rectification. 
 
The bench reiterated that the apex court order had made it clear that there can't be any re-assessment. 
 
Rohatgi responded figures are "not cast in stone" and added, tribunals don't have the power of review but they can correct arithmetical errors. He submitted that they were not seeking an extension of time. 
 
Senior advocate Arvind Datar, representing Tata Tele Services Ltd, submitted rectification of errors in calculation can be done. 
 
Solicitor General Tushar Mehta, representing the Centre, submitted he has not received any instructions from the DoT on allowing correction of errors. 
 
The bench had said that it has said not just once, but twice and thrice that AGR demand can't be recomputed. 
 
Senior advocate AM Singhvi, representing Airtel, said there are cases of duplication and also of payments made but not accounted for. He submitted, "I don't want to pay thousands of crores on account of these errors". 
 
Mehta said he can take instructions on this within two days. "It may be little hazardous for me to make statement without taking instructions..", said Mehta.

Also read |&nbsp;<a href="https://www.wionews.com/india-news/supreme-court-gives-vodafone-idea-airtel-10-years-to-pay-agr-dues-to-government-324447">Supreme Court gives Vodafone-Idea, Airtel 10 years to pay AGR dues to government</a> 
 
In September last year, the top court had given 10 years'&nbsp;time to telcos, who were struggling to pay Rs 93,520 crore in AGR dues outstanding amount to the government. 
 
The apex court had said that telecom operators shall make the payment of 10 per cent of the total dues as demanded by DoT by March 31, 2021. The bench had said the rest of the amount was to be paid in yearly instalments commencing from April 1, 2021, to March 31, 2031.

In a big setback for telecom companies, the Supreme Court on Friday dismissed their plea seeking correction of alleged errors in Adjusted Gross Revenue (AGR) calculation.

In a big setback for telecom companies, the Supreme Court on Friday dismissed their plea seeking correction of alleged errors in Adjusted Gross Revenue (AGR) calculation. A bench headed by Justice L Nageswara Rao said all applications were dismissed. On Monday, the apex court already said it would pass its order on applications filed by, Vodafone Idea, Bharti Airtel and Tata Tele Services Ltd, alleging arithmetical errors in the calculation of AGR dues payable by them. The top court, citing an earlier order in the matter, had noted the order clearly point out that no re-assessment of AGR related dues can be done. The telcos submitted that arithmetical errors can be rectified and there are cases of duplication of entries. Also read | Will not hear arguments on reassessment of AGR related dues "even for a second": SC to telcos Senior advocate Mukul Rohatgi, representing Vodafone Idea, had submitted they were not blaming the Department of Telecommunications (DoT) for it, and there are arithmetical entries. Rohatgi added that they want to bring these errors to the attention of the concerned department, for their rectification. The bench reiterated that the apex court order had made it clear that there can't be any re-assessment. Rohatgi responded figures are "not cast in stone" and added, tribunals don't have the power of review but they can correct arithmetical errors. He submitted that they were not seeking an extension of time. Senior advocate Arvind Datar, representing Tata Tele Services Ltd, submitted rectification of errors in calculation can be done. Solicitor General Tushar Mehta, representing the Centre, submitted he has not received any instructions from the DoT on allowing correction of errors. The bench had said that it has said not just once, but twice and thrice that AGR demand can't be recomputed. Senior advocate AM Singhvi, representing Airtel, said there are cases of duplication and also of payments made but not accounted for. He submitted, "I don't want to pay thousands of crores on account of these errors". Mehta said he can take instructions on this within two days. "It may be little hazardous for me to make statement without taking instructions..", said Mehta. Also read | Supreme Court gives Vodafone-Idea, Airtel 10 years to pay AGR dues to government In September last year, the top court had given 10 years' time to telcos, who were struggling to pay Rs 93,520 crore in AGR dues outstanding amount to the government. The apex court had said that telecom operators shall make the payment of 10 per cent of the total dues as demanded by DoT by March 31, 2021. The bench had said the rest of the amount was to be paid in yearly instalments commencing from April 1, 2021, to March 31, 2031.

SC dismisses telecom companies' plea seeking correction in AGR calculation

The Supreme Court Monday said it will not hear "even for a second" arguments on re-assessment of Adjusted Gross Revenue (AGR) related dues of telecom companies which approximately run into Rs 1.6 lakh crore.

A bench of Justices Arun Mishra, S Abdul Nazeer and M R Shah reserved its verdict on the issue of timeline for staggered payment of AGR-related dues by telecom companies.

The Centre had earlier urged the top court that up to 20 years be given to telecom companies for the payment of dues in staggered manner.

''We will not hear arguments for re-assessment (of AGR related dues) even for a second,''&nbsp;the bench said.

During the hearing, the bench observed that 15 or 20 years is not a reasonable time period and the companies should come forward with appropriate time frame.

The top court said it would also examine the bona fides of some telecom companies going into insolvency.

On June 18, the top court was informed by the Centre that the Department of Telecommunications (DoT) has decided to withdraw 96 per cent of the Rs 4 lakh crore demand for AGR related dues raised against non-telecom PSUs like GAIL.

The court had asked the private telecom companies including Bharti Airtel, Vodafone Idea to come out with a reasonable payment plan, make some payment to show their bona fide&nbsp;and file their books of accounts for the last 10 years. PTI

The Supreme Court Monday said it will not hear "even for a second" arguments on re-assessment of Adjusted Gross Revenue (AGR) related dues of telecom companies which approximately run into Rs 1.

The Supreme Court Monday said it will not hear "even for a second" arguments on re-assessment of Adjusted Gross Revenue (AGR) related dues of telecom companies which approximately run into Rs 1.6 lakh crore. A bench of Justices Arun Mishra, S Abdul Nazeer and M R Shah reserved its verdict on the issue of timeline for staggered payment of AGR-related dues by telecom companies. The Centre had earlier urged the top court that up to 20 years be given to telecom companies for the payment of dues in staggered manner. ''We will not hear arguments for re-assessment (of AGR related dues) even for a second,'' the bench said. During the hearing, the bench observed that 15 or 20 years is not a reasonable time period and the companies should come forward with appropriate time frame. The top court said it would also examine the bona fides of some telecom companies going into insolvency. On June 18, the top court was informed by the Centre that the Department of Telecommunications (DoT) has decided to withdraw 96 per cent of the Rs 4 lakh crore demand for AGR related dues raised against non-telecom PSUs like GAIL. The court had asked the private telecom companies including Bharti Airtel, Vodafone Idea to come out with a reasonable payment plan, make some payment to show their bona fide and file their books of accounts for the last 10 years. PTI

Will not hear arguments on reassessment of AGR related dues "even for a second": SC to telcos

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Vodafone Idea seeks Government relief in AGR duress crisis

SC dismisses telecom companies' plea seeking correction in AGR calculation

Will not hear arguments on reassessment of AGR related dues "even for a second": SC to telcos