Supreme Court Permits Centre To Revisit Vodafone Idea’s AGR Dues In Policy-Based Relief

In a major reprieve for Vodafone Idea, the Supreme Court on Monday permitted the Central government to re-examine the matter of Adjusted Gross Revenue (AGR) dues amounting to Rs 9,450 crore, providing potential relief for the financially distressed telecom operator.

The bench observed that the issue lies within the Union government’s policy framework.

The court highlighted that the move considered the interests of Vodafone Idea’s 200 million subscribers, underscoring the broader consumer impact of the case.

Background: 2019 AGR Verdict

The decision comes against the backdrop of the Supreme Court’s 2019 ruling, which had upheld the Centre’s interpretation of AGR and allowed the recovery of Rs 92,000 crore from telecom service providers, a verdict that significantly affected firms such as Vodafone and Bharti Airtel.

Vodafone Idea had recently filed a plea challenging a fresh AGR demand of Rs 9,450 crore raised by the Department of Telecommunications (DoT), contending that much of the claim related to the pre-2017 period already settled by the apex court.

Solicitor General Tushar Mehta argued before the bench that the circumstances surrounding the case had substantially changed, as the government had infused equity into Vodafone Idea.

“The government’s interest is public interest. There are 20 crore consumers. If this company is to suffer, it would lead to issues for consumers,” Mehta stated.

Recording the government’s stance, the Supreme Court observed that the Centre was willing to re-evaluate the issue.

“The government is also willing to reconsider and take an appropriate decision if the court permits. In the peculiar facts, we see no impediment in the government reconsidering the issue. We clarify that this is a matter of policy; there is no reason as to why the Union should be prevented from doing so,” the order noted.

AGR represents a revenue-sharing arrangement where telecom operators pay a portion of their earnings to the government as licence and spectrum usage fees.

The dispute over AGR’s definition had persisted for years, with telecom firms insisting it cover only core telecom services, while the government maintained it should include income from non-telecom activities as well.