Vodafone Idea has sought the government’s intervention to set a floor price for mobile services as well as sops such as bringing down the licence fee and spectrum usage charges payable by companies, a person aware of the matter said requesting anonymity. “Vodafone Idea has also sought that its GST refund of Rs 8,000 crore be adjusted against its AGR dues,” the person said adding that “immediate implementation of floor price has also been sought”.
The company’s demands come a day before the Digital Communciations Commission (DCC), the highest decision making authority at the department of telecommunications, will meet on Thursday to discuss relief steps in the aftermath of the AGR crisis in the sector. The meeting will happen a week after a series of meetings between Vodafone Idea chairman Kumar Mangalam Birla and top government officials. Birla met telecom secretary Anshu Prakash last Tuesday, and followed it up with a meeting with finance minister Nirmala Sitharaman the next day.
After the meetings with Birla, the Finance Ministry and DoT have started discussions on possible relief measures to prevent the sector from becoming a duopoly in the hands of Reliance Jio Infocomm Ltd and Bharti Airtel Ltd. Several proposals are being discussed to provide the sector with immediate relief from the AGR dues such as setting up a fund which will lend money to telcos at a concessional rate to repay their dues. Allowing companies a revised payment plan and enabling them to defer payment of penalties and interests in future has also been explored, Mint had reported on Tuesday.
Meanwhile, DoT has also asked all operators to speed up their self-assessment of adjusted gross revenue related dues and submit documents supporting their calculation even after Bharti Airtel, Tata Teleservices and Vodafone Idea made partial payment last week. Telecom operators are scrambling to pay dues after the Supreme Court on 14 February pulled up telcos and government officials for failing to comply with its 24 October 2019 verdict.
The court had last year upheld the government’s definition of AGR, on which it calculates levies on telecom operators. The order dealt a massive blow to the telecom industry, which argued that AGR should only include revenue from core telecom operations and not include dividends and rents. Telecom operators now have to pay dues for the past 14 years, along with interest and fines. Vodafone Idea is the worst hit by the verdict and is on the brink of collapse. Its last-ditch efforts to earn a reprieve from the apex court last week failed after which it paid ₹3,500 crore as part payment of AGR dues.
The government is exploring the possibility of roping in third-party audit firms to reconcile dues payable by telecom operators after differences emerged in individual calculations made by the government and telcos, Mint had reported last week. Bharti Airtel has paid ₹10,000 crore out of its estimated liability of more than ₹35,000 crore. It plans to pay the remainder before 17 March after doing a self-assessment of the dues. Tata Teleservices paid ₹2,197 crore last week but the government pegs its dues at ₹14,000 crore. Jio is the only telco which paid its ₹190 crore dues on 23 January.