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Supreme Court Dismisses Telecom Giants’ AGR Dues Waiver Pleas, Citing Misconceived Petitions
In a major setback for India’s telecom sector, the Supreme Court on Monday dismissed petitions filed by major telecom companies—Vodafone Idea, Bharti Airtel, and Tata Telecom—seeking relief from the burden of interest, penalties, and interest on penalties arising from their long-standing adjusted gross revenue (AGR) dues.
The bench comprising Justices JB Pardiwala and R Mahadevan expressed clear disapproval of the telecom operators’ attempt to seek exemptions, calling the petitions “misconceived.” The Court emphasized that multinationals of such stature should not approach the judiciary with such pleas.
“Heard Senior Advocates Mukul Rohatgi, Arvind Datar, and Shyam Divan for the petitioners. These multinational companies have filed writ petitions which we find wholly misconceived. Petitions dismissed,” the Court observed.
Vodafone Idea had argued that it is grappling with severe cashflow constraints and had requested the Court to postpone the matter until July 2025. Senior Advocate Mukul Rohatgi, representing the company, said they were exploring relief through government channels and urged the court to wait for the outcome of those discussions. However, the court refused to grant an adjournment and proceeded to dismiss the petition.
Vodafone Idea’s financial stress is no secret—it has nearly 200 million subscribers, holds an 18% market share, and employs more than 20,000 people. Yet, the company is expected to pay ₹18,000 crore annually toward AGR dues for the next six years, a commitment it deems unsustainable. The company stressed that this situation threatens its viability, could reduce market competition, and would adversely affect millions of consumers.
Currently, the Union Government owns a 48.99% stake in Vodafone Idea, following the conversion of spectrum and AGR dues into equity. The government acquired 14.89% equity in February 2023 and another 34.10% in April 2025, indicating its vested interest in the company’s survival.
The AGR dispute traces its roots to the National Telecom Policy (NTP) of 1999, which introduced a revenue-sharing model. Under this regime, telecom companies were required to pay a percentage of their annual gross revenues as license and spectrum fees. However, a fundamental disagreement arose over the definition of “gross revenue.” Telecom companies argued that only revenue from core telecom services should be considered. The Department of Telecommunications (DoT) disagreed, insisting that all revenue—including that from asset sales, interest, and rent—be included in AGR calculations.
This disagreement led to protracted litigation. Initially, the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) ruled in favor of telecom companies in 2006 and 2015. However, on October 24, 2019, the Supreme Court reversed those decisions and upheld the DoT’s broader interpretation of AGR, imposing massive financial liabilities on the telecom players.
As per government data, the dues amount to ₹1.19 lakh crore:
- Vodafone Idea: ₹58,254 crore
- Bharti Airtel: ₹43,989 crore
- Tata Teleservices: ₹16,798 crore
A September 2020 ruling allowed a 10-year staggered payment plan. But in July 2021, the court firmly rejected requests for a reassessment or re-calculation of dues. Vodafone Idea’s subsequent curative petition also failed.
In the latest plea, Vodafone Idea did not challenge the original 2019 AGR judgment but specifically sought waiver of interest, penalty, and interest on penalty—amounting to a large portion of the ₹83,400 crore due as of March 2025. The company noted that its annual operational cash flow of ₹9,200 crore is significantly lower than its AGR obligation, making payments infeasible.
Vodafone Idea highlighted the 2021 Telecom Relief Package, which provided moratoriums, updated the AGR definition, and reduced penalties, as evidence that the government itself acknowledged sectoral distress. The company also stated that since its 2018 merger, it has raised ₹56,000 crore in equity but has been unable to access fresh debt for over five years.
In an April 17, 2025 representation, the company proposed to settle dues by accepting ₹17,213 crore as final principal, waiving all penalties and interest, and repaying ₹7,852 crore over 20 years. The DoT rejected the proposal on April 29, citing the binding nature of the 2019 Supreme Court ruling.
With this latest plea dismissed, the telcos are once again left in financial uncertainty, and the industry braces for potential consolidation or further distress—unless government intervention or regulatory reforms arrive in time.
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