Telcos pay part of govt dues

KT NEWS SERVICE. Dated: 2/18/2020 12:29:27 PM

RBI concerned about 'defaulting on bank loans'

NEW DELHI, Feb 17: Debt-ridden telecom firms have paid part of the Rs 1.47 lakh crore they owe to the government as the Reserve Bank expressed concern today about the possibility of their defaulting on bank loans. Bharti Airtel made a payment of Rs 10,000 crore today. Vodafone Idea and Tata Group have already paid their share. The telecom companies -- which have been struggling with huge losses -- paid up after the Supreme Court warned that their bosses could be accused of contempt and ordered them to appear in court today. In a hearing last week, the court had ripped into the firms and the government over the dues remaining unpaid despite its order. Finance minister Nirmala Sitharaman said she would get in touch with the telecom department and find out what position it wants to take on the arrears.
Bharti Airtel paid Rs 10,000 crore to the telecom department today. Vodafone Idea and Tata Group have made part payment of about Rs 2,500 crore and over Rs 2,197 crore. According to the Telecom Department, Airtel owes a total of 35,586 crores. After paying 10,000 crores today, it still has to pay around 25,586 crore. Vodafone owed a total of 53,000 crores. After today's payment, It still has to pay around 50,500 crore. Tata Teleservices has to make a total payment of 13,800 crore. The deadline for the payments is March 17.
Asked about the road ahead, Union finance minister Nirmala Sitharaman said, "The Department of Telecommunications is actively engaging with telecom companies after Supreme Court order. I will hear from the department what position it wants to take on matter," reported a national news agency.
With concern that the telecom companies, under pressure to pay the government, may default on existing loans, Reserve Bank of India Governor Shaktikanta Das said they are "very closely" monitoring the situation.
"With regard to the impact on the banking sector, we are very closely monitoring it. It all depends on how the companies concerned are able to make the payments and when they are able to make the payments," he was quoted as saying by news agency.
Earlier today, the Supreme Court refused to pass any order on Vodafone Idea's proposal to pay Rs 2,500 crore by the end of the day and Rs 1,000 crore by Friday. The company had also suggested that in return for the payment, no coercive action be taken against it and asked that the bank guarantee it deposited with the government not be encashed.
Too little, observed a Bench of Justices Arun Mishra, S Abdul Nazeer and MR Shah since the company's dues as per DoT calculations were around Rs 53,038 crore that included spectrum dues and licence fee for the past 20 years. The company is making self-assessment of the dues, noting the DoT calculations are on higher side and it has warned to shut down if no relief is given.
Senior advocate Mukul Rohatgi mentioned the matter with the offer from Vodafone while Bharti Airtel informed the Court that it has already paid Rs 10,000 crore as against DoT's demand for Rs 35,000 crore. The DoT notice issued on Friday asked it to pay Rs 10,000 by Feb 20 and the rest by March 17, the next date of hearing fixed by the top court. Only Jio has paid its dues of Rs 195 crore, too low since it came into existence only two years ago unlike others in the market for two decades.
"As disclosed in the Company's financial statements for quarter ending December 31, 2019, the Company's ability to continue as a going concern is essentially dependent on a positive outcome of the application for modification of the Supplementary Order," the Vodafone said in the filing.
Alike Vodafone, Bharti Airtel also said: "We are in the process of completing the self assessment expeditiously and will duly make the balance payment upon completing the exercise before the next date of hearing."

 

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