Relief for Telcos as SC allows to clear AGR dues within 10 years

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New Delhi: In a big relief to the telecom operators, the Supreme Court on Tuesday allowed the companies to pay AGR (Adjusted Gross Revenue) dues in a period of 10 years.

The Spreme Court Bench consisting of Justices Arun Mishra, S Abdul Nazeer and MR Shah laid down the timeframe within which telecom companies are required to clear their AGR dues in line with the Court’s October 2019 judgment. In view of the COVID-19, the court has allowed the operators to pay 10% of the dues by end of the current financial year i.e. March 31st, 2021. However, the bench has cleared that no revaluation of the AGR dues will be entertained any further.

“It was made clear that interest would accrue in case of default on payment of annual instalments, and that the same may also invite contempt of court. These annual instalments are required to be payed on February 7 every year” reported legal affairs website ‘Bar &Bench’.

The telecom operators have proposed several timelines for payment of the dues ranging from 7 years to 15 years. In March 2020, the Department of Telecom (DoT) had filed an application in the Supreme Court requesting an elongated timeframe ( upto 20 years) for Telcos to repay the dues.

The SC verdict will provide the much-needed relief to Vodafone Idea Limited (VIL) as the Telco was under severe liquidity stress for the last few years. While Reliance Jio has already paid the dues to the DoT, Bharti Airtel, say analysts,  has the liquidity to pay the remaining dues, even in one go.

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