SC reserves order on telcos’ pleas in AGR case

SC reserves order on telcos’ pleas in AGR case

Subject: Economy

Context: The Supreme Court has reserved orders on pleas made by telecom majors for a chance to place their grievances about arithmetical errors in the calculation of Adjusted Gross Revenue (AGR) dues before the Department of Telecom (DoT).

Concept:

• The Supreme Court in September 2020 had granted 10 years to telecom firms for paying the Adjusted Gross Revenue (AGR)-related dues to the DoT with certain conditions.
• The SC asked telcos to pay 10 per cent of the AGR-related dues by March 31, 2021.

What is Adjusted Gross Revenue (AGR)?

• Telecom operators are required to pay licence fees and spectrum charges in the form of ‘revenue share’ to the Centre.
• The revenue amount used to calculate this revenue share is termed the Adjusted Gross Revenue (AGR).
• According to the DoT, the calculations should incorporate all revenues earned by a telecom company – including from non-telecom sources such as deposit interests and sale of assets.
• The companies, however, have been of the view that AGR should comprise the revenues generated from telecom services only and non-telecom revenues should be kept out of it. They had argued that AGR must only include license and spectrum fees.