Relief to PSU on AGR

Public sector undertakings including Oil India, GAIL, and Power Grid Corporation have received huge relief from the Supreme Court directive. The apex court has directed the Department of Telecommunications to reconsider the demand for adjusted gross revenue (AGR) payments from public sector undertakings (PSUs). The telecom department had asked these PSUs to pay the dues of a license fee and spectrum usage charges not only based on telecom related revenue but also based on total revenue, as per a court order dated October 24, 2019.

The department had demanded Rs 1.83 lakh crore from GAIL and Rs 48,489 crore from Oil India. The revenue from their oil and gas business is also included in the calculation of the outstanding amount. Similarly, Power Grid was asked to pay Rs 21,953.65 crore and a notice of liability of Rs 15,019.97 crore was sent to Gujarat Narmada Valley Fertilizer & Chemicals. Similar demands were made from Rail Tel and Delhi Metro.

The apex court today asked DoT to reconsider the outstanding demand from PSUs. The court asked the department on what basis the dues have been sought from the PSU, whereas our order was not related to the PSU.

The court said sternly, "Our order did not say anything about public undertakings. In such a situation, who gave the authority to demand from the PSU? What is all this happening in the name of our order… demand from PSUs should be withdrawn. How can we ask for arrears even when it is not discussed in our order. The government should explain how our order was used for this purpose. This is an abuse of order. '

DoT has sought a total of Rs 2.7 lakh crore AGR from GAIL and other non-telecom PSUs. On 4 March, the court separated the PSU from its order on AGR and directed them to seek relief at the appropriate stage. For telecom companies - Bharti Airtel and Vodafone Idea, the court was asked to submit a payment blueprint. In response, both companies said that they have been given some time to pay AGR dues and the government can cancel their telecom license if the payment is not made. To this, the court said, "No one has seen the next 20 years, only the promise cannot be granted." Bharti Airtel said it has paid Rs 18,000 crore.

Vodafone Idea owes Rs 53,000 crore. She said that she does not have the money to pay and should be given some time. He also said that the license can be canceled if the company fails to pay.

The apex court questioned the decision of DoT on seeking AGR dues from PSUs. The central government acknowledged the difference in license between telecom companies and PSUs.

The court asked the Department of Telecommunications to clarify the situation on placing the demand within three days of the order. The court asked the telecom companies if they were ready to submit the bank guarantee in the event of the license being canceled. The court will now hear the AGR case on 18 June.