Vodafone Idea challenges Rs 9,450 crore AGR demand as Supreme Court schedules hearing on September 26, highlighting telecom sector crisis, regulatory disputes, and financial implications for the company.
Thank you for reading this post, don't forget to subscribe!
NEW DELHI: The Supreme Court of India has agreed to hear a fresh plea by telecom major Vodafone Idea Ltd challenging the additional Adjusted Gross Revenue (AGR) demand of ₹9,450 crore raised by the Department of Telecommunications (DoT). The hearing has been scheduled for September 26, 2025, before a bench comprising Chief Justice B R Gavai and Justices K Vinod Chandran and N V Anjaria.
“This matter concerns AGR dues of ₹9,450 crores.”
CJI BR Gavai
Background
AGR represents the portion of a telecom company’s gross revenue considered for regulatory payments to the government. This includes license fees, spectrum usage charges, and other levies. Vodafone Idea’s petition points out that a substantial portion of the ₹9,450 crore demand relates to periods already settled by the Supreme Court in 2020 for pre-FY17 dues.
According to Vodafone Idea:
- ₹5,675 crore relates to pre-merger Vodafone Group liabilities.
- ₹2,774 crore relates to the post-merger entity, Vodafone Idea Ltd.
- Approximately ₹5,606 crore corresponds to financial years up to 2016-17, which the Supreme Court had ruled could not be reassessed.
The telecom company argues that the DoT’s latest calculations include duplication of amounts and incorrect inclusion of revenues, such as hotel business revenue, which inflates the AGR dues unfairly.
Argument before the Court
Vodafone Idea:
Senior Advocate Mukul Rohatgi, appearing for Vodafone Idea, highlighted:
“Telecom operators pay license fees on revenue, but DoT even adds hotel business revenue to AGR.”
The company also emphasized the existential threat posed by the AGR dues:
- Vodafone Idea currently serves 198 million subscribers and employs 18,000+ people.
- The massive liability threatens the company’s survival and the livelihoods of thousands of employees.
- Delayed or incorrect payments could undermine ongoing 4G network expansion and the 5G rollout, affecting competitiveness with Reliance Jio and Bharti Airtel.
Government:
Solicitor General Tushar Mehta, appearing for the Centre, requested time to arrive at a solution:
“In light of larger public interest, Government has also infused 49% equity. Some solution may be required, subject to this court’s approval.”
The bench responded:
“But why hasn’t a solution been found yet?”
The court has scheduled the matter for next Friday, signaling the need for a final resolution.
Past Developments
- In July 2021, the Supreme Court dismissed applications from Vodafone Idea and Bharti Airtel seeking corrections of alleged errors in AGR dues calculations.
- In October 2019, the Supreme Court issued the original AGR verdict, setting a 10-year timeline for operators to clear ₹93,520 crore dues.
- DoT proposed a staggered payment plan over 20 years to help telecom companies manage the burden.
Vodafone Idea’s new plea argues that the revised AGR demand exceeds the scope of previous judgments and seeks a comprehensive reassessment based on the Deduction Verification Guidelines of February 2020.
Following reports of the Supreme Court hearing, Vodafone Idea’s share price surged 10% to ₹8.61 intra-day, reflecting investor optimism about a possible resolution.
Case Title:
Vodafone Idea Ltd. v. Union of India
Read Live Coverage: