SC’s closing AGR order silent on ‘no objection’ to govt assist for telcos-OxBig News Network

During a listening to on 19 May, a bench comprising Justices J.B. Pardiwala and R. Mahadevan had clarified that if the Centre selected to step in, the court docket wouldn’t stand in the way in which. “If the federal government desires that can assist you, we’re not coming in your approach,” Pardiwala had stated.

However, the court docket’s written order, issued on 21 May, makes no reference to that comment, which was broadly seen as a inexperienced gentle for doable aid. The omission carries vital implications, because it leaves the federal government with out formal authorized backing to intervene within the sector’s long-standing dues disaster.

Read this | Supreme Court dismisses Vodafone Idea, Airtel, Tata Teleservices plea for AGR interest waiver

“Oral remarks in court docket haven’t any binding impact except mirrored within the written order. The judgment doesn’t prohibit the federal government from formulating impartial coverage measures to help the telecom sector,” stated Shiju PV, Senior Partner at IndiaRegulation LLP.

“The authorities retains full authority to supply aid—whether or not by means of restructuring, waivers, or rationalisation of dues—as long as it doesn’t immediately contravene the Supreme Court’s binding 2019 AGR ruling. The approach ahead now lies squarely with the federal government,” he added.

Analysts say the federal government can nonetheless search written clarification from the Court to proceed with any aid plan. 

“If the federal government will get written clarification on this from the SC (Supreme Court), it may achieve flexibility to waive curiosity, penalty and curiosity on penalty; lengthen the deadline for fee of AGR dues from the present thirty first March 2031; and/or rectify calculation errors,” stated a 20 May be aware by brokerage IIFL Capital.

“Irrespective of the above, the federal government additionally has the choice to introduce an ordinance in Parliament to facilitate AGR waiver,” the be aware added.

AGR saga: Where it stands

The Supreme Court on 19 May dismissed pleas by Bharti Airtel, Vodafone Idea, and Tata Teleservices searching for a waiver on curiosity, penalty, and curiosity on penalty on pending AGR dues.

Vodafone Idea, which owes ₹83,400 crore in AGR dues, had sought a waiver of ₹45,000 crore comprising curiosity and penalties. Bharti Airtel and its unit Bharti Hexacom sought aid on ₹34,745 crore out of a complete legal responsibility of ₹43,980 crore. Tata Teleservices owes over ₹19,000 crore.

In addition, Vodafone Idea owes ₹1.19 trillion in spectrum dues, taking its complete dues to the federal government to over ₹2 trillion as of March-end.

With the four-year moratorium ending in September, funds of ₹18,000 crore a yr are set to start from 31 March 2026—greater than twice the corporate’s annual operational money move of ₹8,400–9,200 crore.

Read this | Two months after second lifeline, Vodafone Idea again raises survival fears

Mukul Rohatgi, representing Vodafone Idea, had instructed the court docket on 19 May that the federal government can’t assist since it’s 50% proprietor of the corporate, within the backdrop of the Supreme Court judgement within the AGR case.

Solicitor General Tushar Mehta, showing for the Centre, had stated, “What we’ve got stated is that, in view of the judgment of the Lordships, we can’t study [the relief sought], and it can’t be examined.”

The AGR disaster stems from a 2019 Supreme Court ruling that included non-telecom income within the calculation of dues, creating a large mismatch between Department of Telecommunications (DoT) calls for and the businesses’ self-assessed liabilities.

Curative petitions filed by telcos have been rejected by the apex court docket in September 2024.

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According to officers, the DoT had at one level thought-about a proposal to waive 50% of the curiosity and 100% of the penalties and curiosity on penalties. That may have diminished Vodafone Idea’s dues by ₹52,000 crore and Airtel’s by ₹38,000 crore. But the proposal was in the end shelved amid considerations over doable political backlash.