Vodafone Idea shares rise 4% as SC allows Centre to review Rs 5,606 crore AGR dues

New Delhi: Shares of Vodafone Idea ended nearly 4 per cent higher on Monday after the Supreme Court permitted the Centre to reconsider and reconcile the company's pending adjusted gross revenue dues amounting to Rs 5,606 crore for the financial year 2016–17.

The stock climbed 3.85 per cent to settle at Rs 9.99 on the BSE. During the day, it surged 9.87 per cent to Rs 10.57.

At the NSE, the stock jumped 3.63 per cent to Rs 9.97.

In a significant development, the Supreme Court on Monday permitted the Centre to reconsider and reconcile Vodafone Idea Ltd’s pending adjusted gross revenue dues amounting to Rs 5,606 crore for the financial year 2016–17, observing that the issue falls within the policy domain of the government.

Adjusted gross revenue (AGR) is the income figure used to calculate the licence fees and spectrum charges that telecom companies must pay to the government.

A bench comprising Chief Justice B R Gavai and Justice K Vinod Chandran passed the order while hearing a writ petition filed by Vodafone Idea challenging fresh AGR-related demands raised by the Department of Telecommunications (DoT).

The telco contended that these additional claims were unsustainable as the liabilities had already been crystallised by the apex court's 2019 judgment on AGR dues.

During the hearing, Solicitor General Tushar Mehta, appearing for the Centre, informed the court that the government now holds 49 per cent equity in Vodafone Idea, and that around 20 crore consumers depend on its services.

He submitted that given these circumstances, the Centre was willing to examine the issues raised by the company to ensure that consumer interests are safeguarded.

The bench noted that the petition has been filed seeking the quashing of additional AGR demands for 2016-17, and further directions to comprehensively reassess all dues.

“The solicitor general on instructions states that taking into consideration the change in circumstances, i.e., the Centre acquiring 49 per cent equity and 20 crore customers utilising the service of the petitioner, the Union (government) is willing to examine the issues raised by the petitioner (company),” the bench said.

“Taking into consideration the status of the case now -- the government has infused substantial equity into the company and that it will have direct bearing on 20 crore customers -- we see no issue in the Union reconsidering the issue and taking appropriate steps,” the CJI said in the order.

The telco on Monday said it looks forward to working closely with the telecom department to resolve the matter in the interests of its nearly 200 million subscribers.

In a BSE filing, VIL said: "In a positive development, the Hon’ble Supreme Court has today permitted the Government to consider the grievances of Vodafone Idea Limited on the issues relating to AGR. We look forward to working closely with the Department of Telecommunications to resolve this matter in the interests of our nearly 200 million subscribers".