The Supreme Court of India has scheduled a hearing for Vodafone Idea Ltd’s curative petition related to the Adjusted Gross Revenue (AGR) case for August 30. This hearing comes after the Supreme Court acknowledged Vodafone Idea’s appeal against its 2019 judgment on government payments.
Vodafone Idea’s curative plea is seeking three main forms of relief. First, the company wants corrections made to arithmetic and clerical errors in the calculation of the AGR demand. Second, the plea requests that the penalty imposed be reduced to 50% of the total shortfall. Lastly, Vodafone Idea is asking for a revision of the interest rate applied to the penalty, proposing it be set at 2% above the prime lending rate of the State Bank of India.
In July, senior advocate Harish Salve, representing Vodafone Idea, highlighted that the company had submitted this curative plea in September 2023 and was still awaiting a hearing. Salve emphasized that the Department of Telecom had made errors in calculating the final demand, which is a major concern for the company.
The AGR demand, confirmed by the Supreme Court in 2019, initially amounted to ₹58,000 crore for Vodafone Idea. With interest, this burden has now risen to ₹70,320 crore by the end of FY24. Bharti Airtel has also filed a similar curative plea and is waiting for the Supreme Court’s response.
The ₹58,000 crore demand comprises three parts: principal, interest, and penalty. The principal amount is approximately ₹14,000 crore. Vodafone Idea argues that, after correcting for errors, this principal demand should be around ₹8,000 crore.
Salve further pointed out that the company did not have an opportunity for a hearing before the penalty was imposed, which is not standard procedure. Additionally, he noted that Vodafone Idea has undergone some restructuring, including converting government dues into equity, which has made the government the largest shareholder with over 32% of the company.
Salve also stressed that Vodafone Idea needs clarity from the Supreme Court to secure funding for paying the dues through debt. The company is trying to raise funds, but lenders require a clear understanding of the final financial obligations.
On the Bombay Stock Exchange, shares of Vodafone Idea Ltd closed at ₹15.96, down by ₹0.040, or 0.25%.
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