Sunil Bharti Mittal, the founder of Bharti Enterprises. Photo: AFP

After getting a rap from the Indian Supreme Court for non-payment of adjusted gross revenue dues to the telecom department, Bharti Airtel, Vodafone Idea and Tata Teleservices are likely to make payment on Monday to avoid punitive action.

On Friday, the Supreme Court flayed the telecom companies for not abiding by its order regarding payment of revenue dues worth 1.47 trillion rupees (US$20.6 billion) to nearly 15 companies, many of them are now defunct. The three companies had filed a modification petition in the Supreme Court, asking that they be allowed to discuss the modalities and payment timelines with the Department of Telecom.

The court also attacked the government for not recovering the dues by January 23, as stipulated in its earlier order. The telecom department had directed its offices not to take any coercive action against the telecom companies till the Supreme Court’s decision on the modification appeal filed by the three companies. The court also demanded that the telecom department withdraw its executive order overriding the court order to recover the dues.

The three companies jointly need to pay over 1 trillion rupees ($14 billion), but they have informed the telecom department they will only be making partial payment, the Press Trust of India reported.

Following the Supreme Court order on Friday, Bharti Airtel offered to pay 100 billion rupees by February 20, but the telecom department declined to grant any extension. Vodafone Idea said on Saturday it was assessing the amount that can be paid towards AGR dues, given it flagged concerns over the continuation of its business.

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The Supreme Court has also asked managing directors and directors of the company to be present in person for the court’s next hearing, scheduled for March 17, in case there is a violation of its order. In its order on October 24 last year, the court widened the scope of adjusted gross revenue to include income from non-core items. The dispute arose when telecom companies migrated to a new system offered by the government in 1999, under which operators agreed to share a certain percentage of revenue with the government.

This legal battle dragged on for 14 years, with operators arguing that the revenue should be made up of income from telecom services. But the telecommunications department said it should include all revenue earned by an operator, including non-core telecom operations. The Supreme Court delivered its judgment in favor of the department.

So far only Reliance Jio, which owed a relatively small amount of 600 million rupees, has paid its dues. None of the other companies, including state-owned Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd, have cleared their dues.

As per the last available estimates, Airtel owes nearly 356 billion rupees, including license fees and spectrum usage charges, to the government.

Vodafone Idea is staring at dues worth 530 billion rupees, which includes up to 247 billion rupees of spectrum dues and another 283 billion rupees in license fees.

Tata Teleservices owes around 138 billion rupees, while state-owned Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd owe 49 billion rupees and 31 billion rupees respectively.

Public sector companies, that do not sell telecom services, also owe the telecom department around 2.65 trillion rupees. However, these organizations have the option to approach the court for a legal recourse.

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