NEW DELHI: Faced with show-cause notices from the Supreme Court and a hasty reversal of position by the Department of Telecom (DoT), beleaguered Vodafone Idea Ltd (VIL) on Saturday said it will pay self-assessed AGR dues “in the next few days”.
However, the company reiterated its survival depends on relief, without which it may well find itself winding down operations or approaching the insolvency court.
If that happens, it would have far-reaching consequences, considering VIL’s substantial debt exposure to banks and the jobs of nearly 10,000 employees. According to SBI Chairman Rajnish Kumar, banks will "have to pay the price" in case any telecom firm files for bankruptcy.
While the DoT had shot off notices to all affected companies following the SC’s outrage on Friday, asking them to clear the dues by midnight, it was an impossible deadline for the non-compliant telcos. None of them managed to make any payments so far.
“(VIL) is currently assessing the amount that it will be able to pay to DoT towards the dues calculated based on AGR (Adjusted Gross Revenue), as interpreted by the SC in its order dated October 24, 2019. The company proposes to pay the amount so assessed in the next few days,” VIL said in an exchange filing.
However, the telecom major repeated that its ability to operate as a going concern “is essentially dependent on a positive outcome of the application for modification” of the SC’s order asking telcos to pay around Rs 1.47 lakh crore in pending AGR dues by January 23. Of the 15 companies, only Reliance Jio had complied on time, paying around `190-odd crore before the deadline.
“If there is a negative impact on any enterprise, it impacts a larger ecosystem, whether it is banks, whether it is employees, whether they are vendors, consumers, so everybody gets impacted," warned SBI’s chairman. He said his bank said is in the "wait-and-watch mode" regarding the AGR matter.
Will discuss if problems arise: RBI Governor
RBI Governor Shaktikanta Das told reporters that the central bank will have internal discussions in case there are any issues arising out of the AGR crisis. The SC has warned of contempt proceedings against top executives of telcom firms if they fail to comply with its directive.
Rs 1.47 lakh crore is the amount to be paid by telecom cos for clearing AGR dues