Telco bailout will be contempt of SC; will set bad precedent: Jio to Ravi Shankar Prasad


KOLKATA: Reliance Jio has shot off a second letter to telecom minister Ravi Shankar Prasad to build pressure on the government, saying the latter does not have any legal ground to grant relief to Bharti Airtel and Vodafone Idea on payment of statutory dues based on adjusted gross revenue (AGR).

The Mukesh Ambani-led telco said that the incumbent operators’ arguments even for waiver or lowering of interest, penalty and interest on penalty on such dues had been dismissed by the Supreme Court in its recent order on AGR.

In its latest letter to Prasad, dated November 1 — also marked to the Cabinet Secretary, Niti Aayog CEO and secretaries in the ministries of finance, law and telecom — Jio added that the government does not have the option of going against the Supreme Court judgement to provide “any of the relief sought” by the Cellular Operators Association of India (COAI) for its “two select members, Airtel and Vodafone Idea”. ET has seen a copy of the letter.

Industry body COAI, in a letter dated October 31, had sought a total waiver of the entire sum of Rs 1.3 lakh-crore from the government, on grounds of the poor financial state of the sector, adding that if that isn’t possible, the principal portion be allowed to be rapaid over 10 years, with a two-year moratorium. In an earlier letter to Prasad, following the apex court verdict, it had said that without such relief, Airtel and Voda Idea could face an unprecedented crisis that could result in a monopoly in a sector already saddled with debt of over Rs 7 lakh-crore.

Jio’s latest letter though comes at a time when a panel of secretaries set up to recommend relief measures for telcos is likely to seek legal opinion on options, including any legislative measures needed to alleviate stress in the industry, that was further aggravated by the apex court’s order on AGR.

In its third letter on the topic in less than a week, Jio has countered COAI, by citing portions of the recent Supreme Court judgment acknowledging that “interest and penalty have rightly been levied,” and that “there is no substance in the submission (of incumbents) that interest, penalty and interest on penalty cannot be realised ”, and accordingly “find no ground to reduce the same, considering the nature of untenable objections raised on behalf of the licensees”.

A plain reading of the judgment, Jio said, shows “the licensees have indulged in abuse of the process of court, and deliberately delayed payment of dues on frivolous and legally untenable grounds”.

The company said any cut in financial liability of licensees (read: Airtel and Voda Idea) arising from the apex court verdict would amount to “rewarding them in initiating vexatious proceedings to delay payment of dues,” adding that it would be improper “for government to even consider any waiver of its claims” as such a proposal “would be a loss to the public exchequer and contrary to the Supreme Court judgement”.

Jio also reiterated that both Airtel and Voda Idea have sufficient liquidity and financial strength to overcome adverse financial conditions and meet their contractual obligations, by monetising assets/investments and issuing fresh equity.

The apex court recently upheld the government’s definition of AGR to include revenue from the non-core activities of telcos. Consequently, Voda Idea and Airtel may need to jointly cough up nearly Rs 81,000 crore in licence fees and SUC, with penalties and interest.


Source link

Thick smog over Delhi, 32 flights diverted from IGI airport – delhi news

Fluorescent probes offer fuller view of drug delivery in cells — ScienceDaily