Vodafone Idea Limited will shut down if the government doesn’t provide relief that the company has sought, its chairman Kumar Mangalam Birla said on Friday at an event in Delhi. Vodafone Idea has provisioned 25,677.9 crore for AGR payments, which is estimated at 44,150 crore. This includes an estimated licence fee of 27,610 crore and spectrum usage charges (SUC) of 16,540 crore (with penalty and interest) for up to September 30.
We will shut shop if there is no relief for us and it could be the end of the story for us. There is no company in world that could get this kind of money in three months,” Birla said
AGR (adjusted gross revenues) is a percentage which the telecom companies pay as statutory dues. The Supreme Court had upheld the government position that non-telecom revenues have to be included in the AGR for calculating dues.
Vodafone Idea, Bharti Airtel and Tata Teleservices earlier this month filed separate petitions in the Supreme Court, seeking a review of penalties and interest on the dues, and questioning some components of the non-core items that the court said should be included while computing AGR of telcos.
Birla indicated that his group will not invest any money in the company in the absence of relief from the government.
Vodafone Idea hiked tariffs for its pre-paid plans effective from December 3, a first in past four years, under which call and data charges will be dearer by up to 42 percent.
Vodafone Idea will also charge 6 paise per minute for every outgoing call made by customers on to the network of other operators.
After the entry of Reliance Jio in the telecom sector in 2016, the telecom operators have been slashing down the recharge tariffs in order to tackle the cut-throat war from Jio.