CA Ranganatha Achar K
Quick Summary
Synopsis Understanding the Adjusted Gross Revenue woes is very much relevant in the Telecom sector as on date because the Government policies on Telecom will have a direct impact on the future of the Telecom industry and its impact is to be felt by all of us in terms of Higher Tariffs and Higher
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FAQ :
AGR is a term used in the Indian telecom sector to calculate license fees and spectrum usage charges. The dispute has largely centred on whether AGR should include all revenues or only those from core telecom services.
The primary dispute was over the definition of AGR. The DoT argued that AGR should include all revenues, including those from non-telecom services, while operators contended that only telecom-related revenues should be considered.
In October 2019, the Supreme Court upheld the DoT's definition of AGR, which includes revenues from both telecom and non-telecom services, setting aside earlier favourable rulings for the operators.
To offset the substantial AGR dues, telecom companies may increase mobile tariffs and aim for higher Average Revenue Per User (ARPU), potentially leading to increased costs for consumers.
Major companies like Vodafone Idea and Bharti Airtel owe significant amounts to the DoT, including license fees, spectrum usage charges, interest, and penalties, totalling tens of thousands of crores of rupees.
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