India's Supreme Court building in New Delhi. Photo: AFP

Legacy telecom operators Bharti Airtel, Vodafone Idea and others were directed by the Indian Supreme Court to finalize payment schedules for their adjusted gross revenue dues to the government.

The court was hearing a plea filed by the Department of Telecommunications seeking to allow Bharti Airtel, Vodafone Idea and others to stagger the payment of their dues, amounting to 1.43 trillion rupees ($18.78 billion), over 20 years.

The two companies have sought additional time to pay the remaining dues on the understanding that their licenses will be cancelled if they fail to do so within the stipulated period.

Bharti Airtel’s total dues were 440 billion rupees (US$ 5.78 billion), out of which it has repaid 180 billion rupees ($2.36 billion). It still owes close to 260 billion rupees ($3.42 billion).

Vodafone Idea’s position is weaker. Its dues were 582 billion rupees ($7.65 billion) and it has so far paid around 63 billion rupees ($827 million). It said it does not have enough money to pay and should be given additional time.

The court asked the telecom companies if they were ready to furnish bank guarantees in case of cancellation of their licenses. The next hearing will be on June 18.

On March 16, the Department of Telecommunications had approached the Supreme Court seeking approval for a formula allowing telecom service providers to pay revenue dues in annual installments over the next 20 years or more.

The Supreme Court had on October 24 last year 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 in 1999 under which operators agreed to share a certain percentage of their revenue with the government.

This legal case dragged on for 14 years, with operators arguing that the revenue should be made up of income from telecom services. But the Department of Telecommunications said it should include all revenue earned by an operator, including non-core telecom operations. The court ruled in favor of the department.