Adequate time needs to be given to the telco to raise funds, especially now that potential investors have comfort from the government taking equity in Vodafone Idea, they said. For the past three quarters, the cash-strapped telecom operator has not been making full payment of the levies at the designated time of payment. But it has been clearing its dues regularly as per the extended timeline granted by the DoT.
As per department officials, since the company is paying interest for the delays, there is no problem as, after the telecom reforms, the provision of penalty has been done away with. “It’s been a few months since the government has taken equity in the company. Vi is trying to sustain itself and it should be supported, so that the telecom sector remains healthy,” one of the officials said, asking not to be named.
Another official said giving extension for making statutory payments along with interest is part of the policy and nothing specifically is being done for Vi. The telecom reforms announced by the government in September 2021 had scrapped the provision for charging penalty on top of interest for making delayed payments, including of statutory dues.
ET had earlier reported that Vi had paid around ₹77 crore towards licence fee against the nearly ₹770 crore due in the April-June quarter. With regards to the spectrum usage charge (SUC), the company has paid around ₹14 crore against dues of ₹137 crore. It has sought time till October to clear the June-quarter arrears.
Telcos typically pay 8% and 3-4% of their adjusted gross revenue (AGR) as licence fee and SUC, respectively. But the SUC element is going down sharply with the addition of 5G airwaves bought by telcos, including Vi, in the latest auction, which attracted zero SUC.
In the preceding March quarter also, the company had paid only 10% of its statutory dues on time. The remaining dues have been paid in instalments.
DoT officials said the loss-making company is trying to raise funds and some time should be given to it. “In coming weeks or a few months, the company may be able to raise funds. We should understand that talks to raise funds were renewed after the government got equity in the company. Now there is clarity among the investors,” another official said.
Vi was struggling to raise funds and was losing customers every month. To provide relief, the telecom department in February converted the firm’s accrued interest on deferred adjusted gross revenue (AGR) dues worth ₹16,133 crore into equity.