NEW DELHI: On October 24, the Supreme Court authorized the Center to recover around Rs 92,000 crore from telecom operators while rejecting their plea that Adjusted Gross Income (AGR), on the basis of which fees are paid by them at the Center, should include only basic telecommunications services, excluding income from other sources. He had accepted the Centre’s contention that the AGR should include dividends, cell phone sales, rents and profits from the sale of scrap metal, apart from service revenues.
Initially, 15% of AGR was set as a license fee under revenue sharing, which was reduced to 13% and finally to 8% in 2013. Almost all telecom operators – Airtel, Vodafone, Idea, RCom, Aircel, BSNL and MTNL – will feel the pinch of the Supreme Court verdict.
“The definition of gross income is crystal clear in the agreement. It is also obvious how the adjusted gross income is to be obtained. It cannot be argued that the income was not defined in the contract. Once the gross income is defined, we can no longer deviate from it and the very meaning is to be given to the income for the agreement, ”declared the magistracy, ruling on the dispute between the Center and the telecommunications companies which has lasted since 2003. The court said that companies not only had to pay license fees, but would also have to pay interest and penalties for late payment.
He had ruled that every source of income was part of the AGR. He said discounts given to consumers on international roaming, commissions and discounts to distributors on the sale of prepaid vouchers are also part of the gross income.
Refusing to grant any relief to telecommunications companies to waive penalties and interest, the court said: “No litigant can be allowed to reap fruit on such inconsistent and untenable positions and to plead for litigation. decades in several turns, which is not so rare but disturbs the projected scenario in very many cases.