Telecom firms told to pay Rs 1.47 lakh crore dues by midnight, hours after SC pulls up government

Airtel has informed the telecom department it will deposit Rs 10,000 crore by February 20, and the remaining amount ‘well before’ March 17, said media reports.

The Department of Telecommunications on Friday ordered telecom companies to clear dues amounting to Rs 1.47 lakh crore by midnight, hours after the Supreme Court pulled up the department for not enforcing its previous orders, PTI reported. The notices came hours after the department withdrew its earlier order, issued on January 23, that prevented officials from taking action against the firms.

The order angered the Supreme Court. During proceedings earlier in the day, the court asked the department if there was no law left in the country. The top court said a desk officer of the department had written a letter to Attorney General KK Venugopal and other constitutional authorities, saying they should not insist on payment from telecom companies and others, and ensure no coercive action is taken against the firms. “We don’t know who is creating this nonsense,” the court said. “Is there no law left in the country?...It is better not to live in this country and rather leave the country.”

The matter was heard by Justices Arun Mishra, S Abdul Nazeer and MR Shah.

Justice Mishra said if a desk officer had the audacity to stay a Supreme Court order, then perhaps the court should “wind up”. The court also issued a contempt notice to the officer. “Does the Supreme Court have no value?” Mishra asked. “This is the outcome of money power!”

The judges then issued contempt notices to Bharti Airtel, Vodafone, Tata Teleservices and others, ordering them to pay the adjusted gross revenue of Rs 1.47 lakh crore to the telecom department before the next hearing on March 17. The court said if the amount is not paid, the managing directors and other senior officers of the companies will have to personally appear in court at the next hearing.

The telecom department began issuing circle or zone-wise notices to the firms after the court proceedings, according to PTI. An order issued by the Uttar Pradesh (West) Telecom Circle directed “all telecom service providers” to clear dues by Friday 11.59 pm. “With reference to subject cited above, you are hereby directed to make the payment of outstanding dues of LF [licence fee] and SUC [spectrum usage] charges by 14.02.2020, 11:59 PM positively,” read the order.

Fifteen entities owe the government Rs 1.47 lakh crore. Of this, Rs 92,642 crores amount to unpaid licence fee and Rs 55,054 crore is outstanding spectrum usage charges. Vodafone Idea owes the government the most – Rs 53,000 crore – followed by Bharti Airtel (Rs 35,500 crore) and the now defunct Tata Teleservices, which owes the government Rs 14,000 crore. It is not yet clear how many telecom firms received the orders and how much they have been asked to pay.

Airtel has informed the telecom department it will deposit Rs 10,000 crore by February 20, and the remaining amount “well before” March 17, The Hindu and The Indian Express reported. While Airtel is expected to survive this crisis, Vodafone Idea faces a potential collapse. This was also evident in the stock market on Friday as the shares of Airtel rose 4.38% despite the court’s ruling, but that of Vodafone Idea tanked 22.22%. Many analysts expect Airtel to pay its dues and survive, and eventually enjoy a duopoly with Jio in the sector.

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Vodafone faces potential collapse after SC orders telecom firms to pay Rs 1.47 lakh crore in a month

On January 15, the top court had dismissed the telecom firms’ petition for review of its earlier order that allowed the government to collect the Rs 1.47 lakh crore by January 23. The court said it did not find any “justifiable reason” to entertain the pleas.

In October, the Supreme Court had asked the telecom operators to pay tax on their non-core revenues over and above the spectrum usage charges and licence fees. It upheld the Centre’s broader definition of revenue, based on which the government calculates levies on telecom operators.

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