Vodafone Idea filed a petition in Supreme court Seeking review of the order dated July 23, which dismissed the plea of telcos for re-calculation of Adjusted Gross Revenue (AGR) dues. According to a report by CNBC TV18, the telecom company has called for ‘arithmetic errors’ to be corrected. This comes after the apex court had earlier dismissed petitions by telecom companies including Bharti Airtel for rectification of these alleged errors which were due by them. The company’s lawyers had told the Supreme Court that the firm was incurring losses and could collapse if the petition was not allowed.
After July 23 order, Vodafone Idea sees its former chairman Kumar Mangalam Birla He requested him to step down and distance himself from the telecom company. In his letter, he attributed the move to the dire financial situation the company finds itself in as a major contributing reason. This came even as Birla wrote a letter to Cabinet Secretary Rajiv Gauba. In writing, Birla offered to hand over his Aditya Birla Group stake in the company to any government-approved entity that would be willing to take it.
Parallelly, Vodafone Idea is struggling to raise the funds required to pay regulatory dues to the government in the form of license and spectrum charges. The dues owed to the government is more than Rs 50,000 crore. The company had an AGR liability of Rs 58,254 crore. Out of this amount, the telecom company had paid Rs 7,854.30 crore, which has an outstanding debt of Rs 50,399.60 crore. The company’s gross debt stood at Rs 180,310 crore as on March 31, 2021, excluding lease liabilities. This amount can be divided into Rs 96,270 crore which takes the form of a deferred spectrum payment obligation and Rs 23,080 crore loan. Banks and other financial institutions. Keep in mind that this does not include the outstanding AGR liability amount.
During the proceedings, Vodafone Idea’s senior counsel, Mukul Rohatgi argued with the apex court that the AGR figures were not set in stone and the Supreme Court had the power to correct the alleged ‘arithmetic error’.
Over the past few years, Vodafone Idea has seen a sharp drop in the subscriber base after handing over market share to industry giants like Bharti Airtel and Reliance Jio. The company has a deadline between December and April to come up with an amount of Rs 22,500 crore to clear its spectrum dues along with AGR. In September 2020, the Supreme Court had made it clear that dues payable by telecom companies would not be subject to any revaluation. Telecom companies will have to pay Rs 93,520 crore of AGR dues to the government over a period of 10 years to repay the loan. However, companies will have to pay 10 per cent of the outstanding amount in advance.
On another note, the company’s stock jumped sharply on August 6 after four days of decline. Shares rose more than 19 per cent. According to a PTI report, this came after Vodafone Idea CEO Ravinder Takkar reached out to the employees to reassure them. The stock jumped 19.53 per cent after the price settled at Rs 7.10 on the BSE, the report said.
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