NEW DELHI: The Supreme Court on Tuesday allowed telecom companies to clear their adjusted gross revenue (AGR)-related dues, amounting to about ₹ 1.6 lakh crore, in a staggered manner spread over 10 years. A three-judge bench of the top court, led by Justice Arun Mishra, directed the telecom companies to pay 10 per cent of the dues by March 31, 2021.The Supreme Court rejected a 20-year payment timeline proposed by the central government and supported by telecom companies, which are reeling under piles of debt amid intense competition.

The top court said the 10-year timeline for payment of AGR dues will begin from April 1, 2021, and the payments will have to be made in instalments till March 31, 2031. The telecom companies will have to clear their dues by February 7 each year and non-payment of dues will incur penalty, interest and contempt of court, the bench added.

The dispute centres around the definition of adjusted gross revenue (AGR). Telecoms pay a percentage of their revenues as license fee to government. They argue that non-core business like rent or income from sale of handsets or roaming charges should not be included in the revenue of which they pay a percentage - they want to pay only on revenue earned from their core business. The court did not agree.

The Supreme Court asked the managing directors or chief executive officers of the concerned telecom companies to give personal guarantees on the payments within four weeks. During the earlier hearings, Tata Telecom had asked for a window of at least 7-10 years for payment of dues, whereas Vodafone-Idea and Bharti Airtel had each suggested payment over 15 years. The Department of Telecommunications (DoT) had, however, stuck to the Cabinet's proposal of payment within 20 years.