New Delhi: The Supreme Court Thursday directed telecom operators to give details of their bank accounts and financial documents of the last 10 years after companies claimed they were not in a position to submit fresh bank guarantees with regard to payment of Adjusted Gross Revenue (AGR) dues.
A bench of justices Arun Mishra, S.A. Nazeer and M.R. Shah was hearing the telecom operators on their payment proposal, via video conferencing.
The court is monitoring the implementation of its October 2019 verdict that upheld the Department of Telecom’s (DoT) definition of AGR and allowed the department to recover dues worth Rs 92,000 crore from the operators.
The deadline for the payment lapsed on 24 January, after which the companies approached the court and got an extension till 17 March to make the payment.
However, DoT, in March, moved a plea for modification of the court’s order, seeking to allow telcos to make the payment in a staggered manner over 20 years.
“You must deposit some money, the government needs money for public welfare during this pandemic. Your industry is the only industry that is making money during this pandemic,” Justice Shah said Wednesday.
At the outset, solicitor general Tushar Mehta informed the court about the withdrawal of AGR demand made to the PSUs. On the last hearing, the bench had pulled up DoT for its move to charge PSUs.
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Government can encash existing bank guarantees: Operators
Vodafone India declined to make any offer and said the company’s financial situation is “extremely precarious.”
“The parent company has written off investment, my losses are over Rs 1 lakh crore. Over Rs 10,000 crore of my (Vodafone) bank guarantees are lying with the Department of Telecom (DoT) … this should be considered as security,” the company’s lawyer, senior advocate Mukul Rohatgi said.
He said the company had no proposal nor any security to offer.
Vodafone, the advocate said, favoured DoT’s formula of payment. “Our only proposal is we will work and pay up the dues,” he said.
Rohatgi claimed if Vodafone is asked to pay up immediately, then it will have to fold up. “It will have an impact on 11,000 employees working with the company,” he said.
Other operators too expressed difficulty in furnishing fresh bank guarantees to the government.
Senior advocate Abhishek Manu Singhvi appearing for Bharti Airtel said the company had already given Rs 18,000 crore out of the Rs 21,000 crore raised against them.
“The department has bank guarantees worth over Rs 10,000 crore, in excess of the demand made. He added that DoT can encash the guarantee if Airtel defaults in payment of dues yet to be paid,” Singhvi told the bench.
He also endorsed the view of the DoT as regards to the plan for phased repayment of dues.
Senior advocate Arvind Dattar, appearing for the Tata group, contended that furnishing fresh bank guarantees may have an adverse impact on future investments in the sector.
When the court asked Vodafone about its assets, Rohatgi submitted they are worth Rs 42,000 crore and have all been kept as surety to secure loans worth Rs 1 lakh crore.
He also offered to present the company’s financials before the bench. At this, the court directed all companies to present their bank accounts and financial books for the last 10 years.
The court also directed the DoT to consider the offer of telecom companies and listed the matter for further hearing in the third week of July.
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