Lawstreet Journal

Supreme Court Directs Airtel To Move To Alternate Forum For Videocon Dues

Lawstreet Journal 26 Aug 2021 5:57pm

Image courtesy: Lawstreet Journal Business Supreme Court Directs Airtel To Move To Alternate Forum For Videocon Dues

On Tuesday, 24th August 2021, the Supreme Court allowed Bharti Airtel to move to an alternate forum against the directions issued to it by DOT(department of telecommunications) to pay the AGR (adjusted gross revenue)dues of Videocon Telecommunications ltd.

Videocon had sold its spectrum to Airtel in 2016. The issue arises from the interpretation given by the Supreme Court in its October 2019 judgment to the term "Adjusted Gross Revenue" in the spectrum licensing agreements between telecom companies and the DoT. The license fee is computed based on AGR. 

The Supreme Court held that 'AGR' includes revenue from non-telecom operations of the companies like rent, profit on sale of fixed assets, dividend and treasury income. This resulted in an additional liability to the tune of Rs 92,000 crores on the telecom companies collectively.

A bench comprising of  justices L NAGESWARA RAO,ABDUL NAZEER,MR SHAH has been set up to hear the plea filed by Bharti Airtel to restrain the Department of Telecommunications from demanding AGR (adjusted gross revenues)dues of Videocon ltd from it.

Senior advocate Shyam Divan,appearing for Airtel submitted that according to the spectrum trading guidelines the liabilities of a telecom company before the sale of its spectrum are to be borne by it only and not by the subsequent purchaser. Therefore, the AGR dues of Videocon before it sold its spectrum to Airtel cannot be recovered from Airtel. 

Divan pointed that the order passed by the Supreme Court in September 2020 had also stated that the dues of a… Continue Reading...

Tagged: Bharti Airtel   Videocon Tower  
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