Supreme Court Allows Centre to Reconsider Rs 9,450 Crore AGR Demand on Vodafone
Court allows Centre to rethink Vodafone’s Rs 9,450 crore AGR dues.
Supreme Court on October 27, 2025, granted the Centre permission to reconsider a hefty Rs 9,450 crore demand in Adjusted Gross Revenue (AGR) dues, offering a lifeline to the struggling telecom giant. The court emphasized that the issue lies within the Union’s policy domain, paving the way for potential relief in a long-standing financial dispute that has weighed heavily on the company’s balance sheet.
The AGR, a fee-sharing mechanism requiring telecom operators to pay licensing and spectrum usage charges to the government, has been a contentious issue. A 2019 Supreme Court ruling sided with the Centre’s broader definition of AGR, which included non-telecom services, leading to a staggering Rs 92,000 crore demand from companies like Vodafone and Bharti Airtel. This verdict crippled the telecom sector, with Vodafone facing severe financial strain.
Vodafone’s latest plea challenged a fresh Rs 9,450 crore AGR demand from the Department of Telecommunications, arguing that much of it related to the pre-2017 period, already settled in the 2019 ruling. Solicitor General Tushar Mehta highlighted a “huge change in circumstances,” noting the government’s equity stake in Vodafone and the potential impact on 20 crore consumers if the company falters. “The government’s interest is public interest,” Mehta told the court, underscoring the need to protect consumers and market stability.
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The Supreme Court, in its order, acknowledged the Centre’s willingness to reassess the demand. “We see no impediment in the government reconsidering the issue. This is a matter of policy, and there is no reason the Union should be prevented from doing so,” the court stated. This decision offers Vodafone a chance to reduce its financial burden, potentially stabilizing its operations in a competitive telecom market.
The ruling has sparked optimism for Vodafone Idea, which has been grappling with mounting debts and intense competition. As the government evaluates its next steps, the outcome could reshape the telecom landscape, ensuring consumer access and market viability while addressing the complex legacy of AGR disputes.
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