The apex court had last week asked GAIL, from whom department of telecommunications (DoT) has demanded AGR dues, “to seek appropriate remedy before the appropriate forum”. This means the SC is not asking GAIL to pay AGR dues like it has asked unified license telecom companies and the company is now likely to appeal to TDSAT against the dues demand, according to equity research firm ICICI Securities.
“Thus, the AGR issue is likely to remain an irritant until TDSAT or a higher court to which the matter may be taken rules on it. However, we expect the eventual ruling to favour GAIL establishing that it is not required to pay license fee on its non-telecom revenues,” ICICI Securities said in a report.
In provisional assessment orders, DoT has raised a demand on GAIL of Rs 1.83 lakh crore towards annual license fee including interest and penalty on AGR. DoT is demanding license fee from GAIL at 8 percent of its total revenue and not just on its miniscule optic fibre revenue.
The company had on 22 January filed an application in the apex court to seek clarification on the applicability to GAIL of the court’s 24 October 2019 order asking unified license telcos to make payment of AGR dues within 90 days.
In its last week order, the court had also pulled up the DOT for failing to implement its October order. The department later sent notices to Airtel and Vodafone, who were slapped with a demand of Rs 1.47 lakh crore, asking them to clear the dues immediately.