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Telecommunications Revenue Charges: Clear Contribution for Revenue Distribution by Supreme Court Order: DoT to Telecommunication Operators

The Telecommunications Department (DT) has asked telecom and internet service providers to pay for spectrum license and license fees after conducting their individual assessments of the wider definition of Adjusted Gross Income (AGR), as the Supreme Court ruled last. month.

In its first official step towards realizing additional AGR fees following a court order dated October 24, DT Wednesday issued notice to all telecoms, ISPs, virtual network operators and their associations to pay and submit compliance documents within three months. of the decision, as authorized by the court.

"It is the responsibility of the licensees to pay the license fee and other charges once they have made their assessment as prescribed in the license agreement," DT said in a notice seen by ET.

"You are therefore instructed to make the payment in accordance with the order of the Honble Supreme Court and to provide the necessary documents to ensure compliance with the prescribed timeframe," the report added.

According to DT calculations, submitted to SK in mid-July, 15 telecoms owe nearly $ 93,000 in license fees, penalties and interest. In addition, the telecoms owe more than 41,000 crore in SUC charges. Vodafone Idea and Bharti Airtel are hardest hit, with combined fees of over Rs 80,000. Tata Teleservices, which sold the consumer mobility business to Airel, owes some SEK 13,000 and the Reliance Communications bankruptcy, about SEK 20,000.

Officials said DT is issuing Notice of Demand for License Fees (LC) and Spectrum Use Fees (CMS) through its circular offices, to all telecoms and ISPs until the last financial year ending March 31, 2019.

"They have to pay the LF and SUC basis AGR as defined by the Committee … Subject to our review of the AGR statement and the payments made by the auditors, and if there is any discrepancy, then we will send special notices on any balance sheet taxis, "the official said.

Another official added: "Carriers will need to calculate their AGR for the current financial year (by March 2020) and hence requests for the current fiscal year will be forwarded in the future," meaning multiple reports are expected.

Telkos said they received the notifications, which will be reviewed and fulfilled.

"However, we are still seeking government relief regarding final payments," said Rajan Mathews, director general of the Association of Mobile Phone Operators of India (COAI), which represents all carriers operating in India.

DT has been in dispute for almost 16 years with carriers over the exact interpretation of the AGR-based license fee, on the basis of which the license fee and the KMS are paid by telecommunications to the government. While telecoms claim that the AGR should include only revenues related to telecommunications services, DT claims that non-core sources such as rent, profits from the sale of fixed assets, dividends, interest and various income should also be included.

In its October 24 ruling, the Supreme Court ruled in favor of the DOT, implying that telecommunications service providers will now have to pay their fees for the broader definition of AGR that includes non-essential items.

The ideas of Bharti Airtel and Vodafone, which are due to report their quarterly results on Thursday, should file a review petition in the UK against the AGR order as they will bear the maximum payment.

In parallel, the government set up a committee of secretaries under the cabinet secretary to take on financial stress in the debt-laden telecommunications sector and propose steps to provide relief.

The panel is likely to recommend a reduction in license fees paid by telecommunications companies and allow a two-year moratorium on spectrum payments as part of measures to ease the debt-laden sector, ET reported Wednesday.

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