AGR problems: the Telecommunications Department slaps Rs 15,019 million rupees of GNVFC demand

NEW DELHI: Fertilizers and chemicals from Gujarat Narmada Valley ( GNVFC ) received a notice of demand from the telecommunications department for the payment of outstanding fees amounting to Rs 15,019 million before January 23, 2020.

The fees correspond to the financial years from 2005-06 to 2018-19 in relation to the VSAT and ISP licenses held by the company, he said. The outstanding amount includes the interest amount as well.

The company said it is seeking expert legal advice on the matter to decide the course of future action.

The company is presently examining the said demand notice and judgement of the Supreme Court by seeking expert legal advice in the matter, GNVFC said in a BSE filing.

Based on legal advice, the company will decide the future course of actions on the subject, he added.

The fertilizer company reported that it received a notice of demand from the Office of Communication Accounts Controller, DoT, Ministry of Communications, Government of India, Gujarat Telecom Circle, Ahmedabad ... ordering the company to deposit the total amount pending of Rs 15019,97,48,444 (including the amount of interest) before January 23, 2020, with respect to the years 2005-06 to 2018-19 in relation to the VSAT and ISP licenses held by the company.

The telecommunications department (DoT) also requested Rs 1.72 lakh crore in previous statutory quotas of the state gas services company GAIL India, after resolution AGR (Adjusted Gross Income) of the Supreme Court in October.

The DoT had sent a letter to GAIL requesting Rs 1.72.655 million rupees in installments in the IP-1 and IP-2 licenses, as well as the Internet Service Provider (ISP) license. In response, GAIL told the DoT that it owes nothing more than what it has already paid to the government.

In addition to GAIL, the DoT is also looking for Rs 1.25 lakh crore from PowerGrid, which had both a national long distance license and an Internet license. PowerGrid says it has an AGR of Rs 3,566 million since 2006-07 and after adding the penalty it reaches Rs 22,168 million.

After sending notices to companies such as GAIL, DoT has said that any relief to non-telecommunications companies from improved tax payments can only come from the Supreme Court.

The DoT is currently examining the answers given by non-telecommunications state firms on AGR fees, a senior official had recently told PTI.

Bharti Airtel, Vodafone Idea and other telecommunications companies owe the government almost Rs 1.47 lakh crore in past legal fees.

These AGR obligations arose after the superior court in October last year confirmed the government's position on the inclusion of non-telecommunications companies' revenues to calculate the annual AGR of the telecommunications companies, a part of the which is paid as license fees and spectrum to the treasure.

The trial court granted the affected companies three months to pay the amounts owed by the government.

Meanwhile, the DoT has made it clear that the AGR order will apply to all licenses, including companies such as GAIL, RailTel and PowerGrid.

As things stand today, such players, despite less exposure to telecommunications, may have to pay liabilities calculated on their total income.

Non-telecommunications companies, such as ISPs, have argued that DoT has unnecessarily imposed the order on ISPs, many of which are managed by entrepreneurs in smaller cities and towns.