After SC rap, DoT orders telcos to settle dues by 11.59 pm tonight

The DoT, which faced the ire of the Supreme Court for putting on hold recovery of dues from telecom companies, started issuing circle or zone-wise demand notices to firms

telcos
The move assumes significance as the amounts paid by telcos so far, even those who have announced full and final settlement, is significantly less than DoT’s AGR estimates.

Bharti Airtel, Vodafone Idea and other telcos are asked to clear their dues before Friday midnight after the Supreme Court rapped telecom companies for not paying adjusted gross revenue (AGR) of ₹1.47 lakh crore to the Department of Telecommunications.

The DoT, which faced the ire of the Supreme Court for putting on hold recovery of dues from telecom companies, started issuing circle or zone-wise demand notices to firms, an order seen by PTI said.

The order issued on Friday by the UP (West) Telecom Circle asked “all telecom service providers” to clear dues by 11.59 pm Friday.

“With reference to the subject cited above, you are hereby directed to make the payment of outstanding dues of licence fee and spectrum usage charges by 14.02.2020, 11:59 PM positively,” it said.

One of the telecom operators, who did not wish to be named, confirmed the receipt of the said order from the circle.

While in all, 15 entities owe the government ₹1.47 lakh crore – ₹92,642 crore in unpaid licence fee and another ₹55,054 crore in outstanding spectrum usage charges, it is not immediately clear just how much of that has been sought by the government by midnight tonight.

The order issued the circle-based Controller of Communication Accounts came after the telecom department earlier on Friday withdrew its order that asked for no coercive action against telecom companies defaulting on statutory dues payment.

Related news: Why wasn’t due of ₹1.47 lakh cr paid? Supreme Court asks telcos

The circular was withdrawn by the telecom department immediately after the Supreme Court took a strong view of non-compliance in payment of dues by telecom companies.

The DoT order issued to its field offices subsequently had asked for “immediate necessary action” in compliance with the October judgment of the Supreme Court.

The direction by the DoT had said its previous order dated January 23, 2020 “stands withdrawn with immediate effect”.

“It is directed to take immediate necessary action in compliance with the judgement dated October 24, 2019, of the Supreme Court,” said the fresh order issued by the DoT.

The Supreme Court on Friday directed the managing directors and directors of telcos and other firms to explain why contempt action be not taken against them for non-compliance of its order to pay adjusted gross revenue (AGR) of ₹1.47 lakh crore to the Department of Telecommunications.

Taking strong note of the non-compliance of its order, a bench of Justice Arun Mishra, Justice S Abdul Nazeer and Justice M R Shah expressed anguish over the order passed by DoTs desk officer, staying the effect of its verdict in AGR matter.

Of the three private players operating in the Indian telecom market, Vodafone Idea is considered to be in the most vulnerable position.

Vodafone Idea is staring at dues worth ₹53,000 crore that includes up to ₹24,729 crore of spectrum dues and another ₹28,309 crore in licence fee, and the company had earlier warned of shutdown if no relief was given.

Vodafone Idea in its earnings statement on Thursday had also sounded out warnings on “material uncertainty” casting “significant doubt” on its ability to continue as a going concern.

VIL had said on Thursday that the company’s ability to continue as a going concern is essentially dependent on a positive outcome of its modification application in the Supreme Court on the AGR matter and any relief from the telecom department on payments.

Last week, Vodafone Chief Executive Officer Nick Read had said the situation in India is critical, following the AGR ruling of the Supreme Court. The British telecom major holds 45.39 per cent stake in VIL.

Related news: Telcos move plea seeking fresh schedule for payment of ₹1.47 lakh cr statutory dues

VIL had suffered staggering ₹50,922 crore loss in the September quarter (highest ever loss posted by any Indian corporate) when it had made provisions for statutory dues following the Supreme Courts order in the adjusted gross revenue matter, although its losses in December quarter narrowed to ₹6,439 crore.

Rival Bharti Airtels liabilities added up to nearly ₹35,586 crore, including licence fee and spectrum usage charge dues. But, Airtel had already said that the previously-mentioned material uncertainty on the groups ability to continue as a going concern “no longer exists” after the recent ₹21,502 crore fundraising by it.

Most of the remaining liability is with state-owned BSNL/MTNL and some of the shut/bankrupt telecom companies.

(With inputs from agencies.)

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