In SC setback for Vodafone Idea, Airtel, a silver lining for telcos seeking AGR relief

By Admin

20 May, 2025

In a significant development for India’s telecom sector, the Supreme Court on Monday dismissed petitions from major telecom players Vodafone Idea, Bharti Airtel, and Tata Teleservices seeking relief on their long-standing Adjusted Gross Revenue (AGR) dues. While this ruling comes as a major legal setback for the telcos, there appears to be a silver lining — the apex court has left the door open for the government to intervene and provide relief if it chooses to do so.

Supreme Court's Dismissal

A bench comprising Justices JB Pardiwala and R Mahadevan termed the petitions “misconceived” and rejected them outright. The telcos had approached the court asking for a waiver on dues comprising interest, penalty, and interest on the penalty. The justices expressed strong disapproval of the petitions, especially from multinational corporations. “We are really shocked by these petitions which have come before us. It is not expected of a multinational company. We will dismiss it,” the bench said while addressing senior advocate Mukul Rohatgi, who represented Vodafone Idea.

Massive AGR Dues in Question

The stakes in these petitions were enormous. Bharti Airtel and its unit Bharti Hexacom had sought a waiver amounting to ₹34,745 crore. Vodafone Idea, on the other hand, sought relief from dues totaling ₹45,457 crore. Rohatgi argued that the survival of Vodafone Idea was essential for maintaining healthy competition in the Indian telecom sector. He also highlighted that the Centre now holds a 49% stake in Vodafone Idea following a recent equity conversion of interest dues — indicating a greater role of the government in the company’s future.

A Path Opened for Government Relief

Though the court refused to provide direct relief, Justice Pardiwala offered a crucial observation that has revived hope within the industry: "If the government wants to help you, we are not coming in the way." This remark signals judicial willingness to let the executive branch take a proactive role in resolving the crisis through policy-based intervention or financial restructuring.

What This Means for the Sector

This decision marks a pivotal moment. While the telcos failed to get judicial relief, the Supreme Court’s openness to governmental action could lead to future policy moves aimed at safeguarding the financial health of the telecom sector. With the Centre already having a significant stake in Vodafone Idea, the government may find it in its interest to facilitate a revival plan — not just to preserve competition, but also to protect public investments and ensure continuity in critical infrastructure.

Conclusion

The Supreme Court’s ruling underscores the finality of its previous decisions on AGR dues but simultaneously nudges the government towards possible remedial action. For Vodafone Idea, Bharti Airtel, and other players, the ball is now firmly in the government's court. With strategic intervention, this legal setback could well transform into an opportunity for structural reform and long-term sectoral stability.