Shares of Vodafone Idea were hit hard today and nosedived 35% after the Supreme Court of India said that the selfassessment of the AGR (Adjusted Gross Revenue) dues by the Department of Telecommunication (DoT) is a violation of court orders.
The scrip tanked about 30% and was seen trading at Rs. 3.40 after the statement. Earlier, the share price of Voda Idea opened at Rs. 5.33 against the close of the previous day of Rs. 4.85 which was an increase of 15%.
Vodafone Idea, recently, computed their AGR dues at Rs. 21,533 crore as opposed o what the DoT claims at Rs. 58,000 crore.
The apex court questioned the Solicitor General on the telecommunication firms’ selfassessment which was done without prior permission from the court. The Supreme Court called it a contempt of court.
The Supreme Court said that it was a matter of public money which has gone unpaid since the last 2 decades and that the telcos were trying to influence the public opinion through the media.
The court furiously asked, Is the officer allowing self-assessment superior to us?,”.
The court said that “if you want us to be harsh, we will call all telecos’ MDs (Managing Directors) and send them to jail”.
Earlier this week, the Government of India (GOI) approached the Supreme Court of India seeking approval for a computation where the telcos will be allowed to make annual instalments of their respective unpaid AGR dues in the coming 20 years or more.
The computation includes freezing of penalties and interests component as on October 24 and protecting the net present value “using the discount rate” of 8%. However, the top court said it will hear on this matter at a later stage.
The Supreme Court ordered DoT to withdraw its move to allow the reassessments saying, “If a reassessment is permitted – it is a fraud on this court. We won’t spare officials who allowed reassessment of telecom dues,”.
Bharti Airtel, who according to DoT have to pay Rs. 43, 980 crore, is claiming that it’s dues is less than a third of it at Rs. 13,004 crore.