Introduction:

In a decisive move, the Supreme Court of India, led by Chief Justice DY Chandrachud and Justices Sanjiv Khanna and BR Gavai, has rejected curative petitions filed by major telecom companies, including Vodafone Idea, Bharti Airtel, and Tata Teleservices. These petitions challenged a 2019 ruling concerning the payment of Adjusted Gross Revenue (AGR) dues. The 2019 judgment had mandated that these companies pay approximately Rs. 92,000 crores, a ruling that was initially contested and subsequently upheld by the Court in January 2020. Despite the telecom companies’ claims of erroneous AGR computations and their subsequent pleas for reconsideration, the Court maintained its stance, emphasizing that no grounds were found to invoke its curative jurisdiction.

Arguments of Both Sides:

The telecom companies contended that the Department of Telecommunications (DoT) had significantly miscalculated their AGR dues. For example, Vodafone challenged a demand of Rs. 58,254 crores against their own assessment of Rs. 21,533 crores. They argued that these discrepancies in AGR calculations represented grave errors that warranted a revision. The companies sought a revaluation of the dues and an urgent listing of their petitions to address the inaccuracies and uncertainties regarding their financial liabilities.

On the other hand, the Department of Telecommunications defended the AGR calculations, asserting that the Court’s definition of AGR—encompassing revenue from non-telecom operations such as rent, dividends, and asset sales—was accurate. The DoT had previously proposed a staggered payment plan to help the telecom firms meet their obligations, which was approved by the Supreme Court in September 2020. This arrangement allowed the companies a ten-year period to settle their dues, with annual payments structured to ease their financial burden.

Court’s Judgment:

The Supreme Court, in its latest ruling, dismissed the curative petitions on August 30, 2023, affirming that the earlier judgments had been correctly rendered. The Court reiterated that the AGR definition, which includes revenues from non-telecom operations, was valid and that the telecom companies’ claims of miscalculation did not merit reconsideration under curative jurisdiction. The judgment underscored that the telecom firms must adhere to the existing payment structure, which had already been set to facilitate their compliance over the next decade.