Tuesday, 21 January 2020

Indian telcos left high and dry as Supreme Court rejects appeals

by Harry Baldock, Total Telecom
Thursday 16 January 20

The government says there was no “justifiable reason” to review the terms ruled on October 24th

The Indian Supreme Court has today dismissed formal petitions by telcos for a review of the fees owed to the state.  “Having perused the review petitions and the connected papers with meticulous care, we do not find any justifiable reason to entertain [them]…

The Indian Supreme Court has today dismissed formal petitions by telcos for a review of the fees owed to the state. 

“Having perused the review petitions and the connected papers with meticulous care, we do not find any justifiable reason to entertain [them],” said the Justices.
 
A request for an open court hearing was also rejected.
 
The fees demanded are as high as Rs 1.47 lakh crore (approximately $13 billion), resulting from the widening of Adjusted Gross Revenue definitions. 
 
Bharti Airtel recently announced that it was raising the $3 billion it owes via the issuing of securities and foreign currency convertible bonds in an attempt to meet the payments. 
 
In a statement reflecting on the Supreme Courts decision, a Bharti Airtel statesperson expressed disappointment that its appeal was not taken more seriously. It was also noted that the money demanded would be better spent by telcos to upgrade the country’s infrastructure for 5G.
 
"The industry needs to continue to invest in expanding networks, acquiring spectrum and introducing new technologies like 5G,” said the spokesperson. “The money now required to pay punitive interest, penalty and interest on the penalty which forms nearly 75% of AGR dues would have better served the digital mission of the country." 
 
With no extension sought, the telcos are due to pay the fees by January 23rd. Such huge payments would wreak havoc to the telcos' finances, threatening to bring operations to a standstill, and severely limiting mobile network operator competition in India.
 
Further petitioning will surely follow on behalf of the besieged companies, but all current evidence suggests the Supreme Court is steadfast in its resolution not to mitigate the penalties.
 
 
Also in the news:
 

Since you're here...

...the Telecoms industry is characterised by constant change and evolution. That's why it's crucial for telecoms professionals to keep up-to-date with what is happening. Join 35,000+ of your peers and sign up to our free newsletter service today, to be in the know about what is going on. PLUS, as a member you can submit your own press releases!

See all membership options

Please enable JavaScript to view the comments powered by Disqus.

Newsletter signup

Quickly get on board and up to date with the telecoms industry