Vodafone Idea has cautioned government that it cannot operate beyond the current financial year without its support, and may have to go for insolvency, reducing the value of Centre's stake to nil, in that case, CNBC-TV18 reported on May 16 citing sources.
Post the equity conversions, the Vodafone Idea owes government Rs 1.95 lakh crore in AGR and spectrum dues.
The company is one of the three major private telecom service providers in India and has around 18 percent of the total market share of mobility subscribers in the country. The government now holds 49 percent stake in the company, following a recent equity conversion of interest dues
The telecom major has reportedly claimed that it is not getting support from lenders despite the capital infusion and equity conversion by Centre.
Should the operator head to the NCLT for insolvency, over 20 crore telecom subscribers will be impacted, said sources. The company also has an active workforce of over 20,000 employees.
Earlier on Thursday, the Supreme Court agreed to hear a fresh plea of Vodafone Idea seeking waiver of around Rs 30,000 crore adjusted gross revenue (AGR) dues.
The telecom company has sought a waiver of around Rs 30,000 crore towards interest, penalty, and interest on penalty components of its AGR dues. The hearing will take place on May 19.
The plea also sought a direction to restrain the Centre from insisting on payment of interest for the period of payment of dues in instalments.
The top court had previously refused to review its 2021 order rejecting the pleas of telecom majors including Bharti Airtel and Vodafone Idea for rectification of alleged errors in calculation of AGR dues payable by them.
The top court also fixed a time frame of 10 years for telecom service providers struggling to pay Rs 93,520 crore of AGR related dues to clear their outstanding amount to the government.
In its September 2020 order, the apex court said that telecom operators should make the payment of 10 percent of the total dues as demanded by the Department of Telecommunications (DoT) by March 31, 2021 and the rest amount would be paid in yearly instalments commencing from April 1, 2021 to March 31, 2031.
The top court, which held the demand raised by the DoT with respect to AGR dues as final, said there should neither be a dispute raised by the telecom companies nor any re-assessment. The apex court in October 2019 delivered its verdict on the AGR issue. The DoT moved a plea in the top court asking for a staggered payment of the dues by telcos over 20 years.
Shares of Vodafone Idea settled 1.66 percent higher at Rs 7.35 per share on the NSE.
(PTI Inputs)
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