The licensing finance policy wing of the telecom department on Thursday directed all departments concerned to not take any coercive action against telecom operators if they fail to clear AGR dues as per the Supreme Court order until further orders.
"The director of licensing finance policy wing has issued direction that concerned departments should not take any coercive action against the licensees in case they fail to comply with the Supreme Court order, until further orders," an official source told PTI.
The direction has been issued following approval of the member, finance, who heads all DoT departments that deal in matters related to revenue.
The apex court had set January 23 as the deadline to pay adjusted gross revenue (AGR) dues.
Bharti Airtel and Vodafone Idea have communicated to the telecom department that they will not pay AGR dues of Rs 88,624 crore, the deadline for which ended on Thursday, and will wait for the outcome of modification petition listed for hearing before the Supreme Court next week, according to official sources.
Reliance Jio on Thursday paid Rs 195 crore to the telecom department to clear all adjusted gross revenue dues accounted till January 31, 2020, according to an official source.
"Reliance Jio has paid Rs 195 crore for AGR. This includes advance money that company has paid for the month of January, 2020," the source said.
The company has made provision of Rs 177 crore to pay for the government revenue share based on the Supreme Court judgment dated October 24, 2019.
Bharti Airtel, Vodafone Idea and other telecom companies owe the government as much as Rs 1.47 lakh crore in past statutory dues.
Tata Communications, in which the government holds 26.12 per stake, has also made no provision for DoT's demand of Rs 6,633 crore for AGR dues as the Supreme Court order did not include an appeal of the company which is still pending before the apex court.
The company said it has replied to the demand cum notice sent by the DoT in September quarter 2019 but has not received any response from the department.
Telecom companies owe the government Rs 92,642 crore in unpaid licence fee, and another Rs 55,054 crore in outstanding spectrum usage charges. These liabilities arose after the Supreme Court in October held that non-telecom revenues have to be considered for calculating statutory dues.
Outstanding SUC (spectrum usage charges) dues of various telecom service providers as on October 31, 2019, added to Rs 55,054 crore.
The DoT is also seeking nearly Rs 3 lakh crore in dues from non-telecom PSUs, such as GAIL, Oil India Ltd and PowerGrid, was a result of "communication gap" as these firms do not owe any such amount, Oil Minister Dharmendra Pradhan said on Thursday.
Following the October 24 Supreme Court ruling, the telecom department sought Rs 1.72 lakh crore from gas utility GAIL India Ltd, Rs 48,000 crore from OIL, Rs 40,000 crore from PowerGrid and raised similar demands from RailTel and other public sector undertakings (PSUs).
The government's demand from such companies increased many times more than their net worth and the Centre asked them to go to the Supreme Court against such dues. While Oil India Ltd filed a clarificatory/ modificatory petition on Wednesday, GAIL approached the apex court on Thursday.
"We are in discussion with the telecom ministry. We had given them our reply (on the demand raised)," Pradhan told reporters. "Possibly because of communication gap, the Government of India's one department has raised such demand on PSUs under another government department."
He said parallel to discussions with the DoT, the Supreme Court has been approached on the issue.
"Where is GAIL in core telecom work? Is PGCIL in core telecom work or does Oil India do any core telecom job," he asked. "We feel there should be no impact (of the October 24 Supreme Court ruling) on these companies."
Pradhan said the approach to the Supreme Court and discussions with the DoT were being conducted simultaneously.
He, however, did not say if seeking relief from the Supreme Court was limited to PSUs under his ministry filing pleas in the apex court or his ministry would also file a petition.
The DoT raised the demands on the non-telecom PSUs for leasing out surplus optical fibre network that was primarily for their internal communications under NLD (National Long Distance Service) licences or IP-1/IP-2.
The demand notices by the DoT follow the Supreme Court's October 24 order that broadened the definition of adjusted gross revenue (AGR) for telecommunications companies to include non-core operations. AGR is used as a basis for the calculation of licence fees and spectrum usage charges owed to the government. GAIL, Oil India, PowerGrid and other non-telecom PSUs were not a party to this litigation.
OIL in its petition to the Supreme Court stated that it will have to shut down operations if it is forced to pay an amount that is twice its net worth.
"OIL had obtained a National Long Distance Service Licence (NLD Licence) to establish supervisory control and data acquisition system (SCADA system) for control, management, and protection of OIL's pipeline network used for transportation of crude oil, natural gas, and petroleum products," the company had said in a statement on Thursday. "As per the licence terms, the licence fee is to be paid on gross total revenue from services provided under the NLD Licence. Since the award of NLD licence, the cumulative revenue of Rs 1.47 crore is earned by OIL from the leasing of spare bandwidth capacity on which all applicable licence fee and other statutory dues as per licence terms have been paid by OIL regularly."
The company stated that based on the recent Supreme Court ruling, "Department of Telecommunications issued demand notices to OIL also seeking payment of licence fee on total reported revenue including revenue from sale of crude oil, natural gas etc, which neither relate to the NLD licence nor can be treated as supplementary/ value-added services related to the NLD licence."
"Till date, OIL has received demand notices for the period from FY2007-08 to FY2018-19 amounting to over Rs 48,000 crore including licence fee, penalties and interest," the statement had said.
From gas utility GAIL, the DoT has sought Rs 1,72,655 crore in dues on IP-1 and IP-2 licences as well as internet service provider (ISP) licence. In response, GAIL has told the DoT that it owes nothing more than what it has already paid to the government.
The firm told the DoT that it had obtained ISP licence in 2002 for a period of 15 years, which expired in 2017. But GAIL never did any business under the licence, and since no revenue was generated, so it cannot pay any amount.
On IP-1 and IP-2 licences, GAIL has told the DoT that it generated Rs 35 crore of revenue since 2001-02 and not Rs 2,49,788 crore that has been considered for levying past dues, adding that the revenue number the DoT is considering is after adding all the revenues that the company earned from gas trading and transportation business.
Sources said the dues being sought are more than three times the net worth of GAIL and several times the actual revenue earned.
While telecom companies such as Bharti Airtel and Vodafone Idea may have had non-telecom revenues generated from using the government licence and spectrum, firms such as GAIL and OIL had no such revenue.
Photograph: Arko Datta/Reuters.
Prasoon Srivastava is a journalist with Press Trust of India. He can be contacted at firstname.lastname@example.org.