In a significant blow to telecom companies, the Supreme Court on Monday rejected the petitions filed by Bharti Airtel, Vodafone Idea, and Tata Teleservices, all of whom had sought waivers on interest, penalties, and the interest accrued on those penalties tied to their adjusted gross revenue (AGR) dues.

A Bench comprising Justices JB Pardiwala and R Mahadevan dismissed the pleas, expressing strong disapproval over the companies’ move to approach the apex court. The judges referred to the petitions as “misconceived” and questioned the propriety of such requests from major corporate players, reported The Economic Times.

“We are really shocked by these petitions which have come before us. It is not expected of a multinational company. We will dismiss it,” the Bench stated, addressing senior advocate Mukul Rohatgi, who appeared on behalf of Vodafone.

Financial Stress Triggers Fresh Legal Appeals

The petitions were part of a renewed legal strategy by telecom operators grappling with massive AGR liabilities. Vodafone Idea approached the court seeking relief from dues surpassing Rs 45,000 crore, citing the severe financial stress it continues to face.

Bharti Airtel, meanwhile, filed an appeal to reduce the financial burden arising from interest and penalty components, though it did not challenge the Supreme Court’s September 1, 2020 verdict on AGR. In its submission, Airtel, along with its unit Bharti Hexacom, sought relief on dues amounting to Rs 34,745 crore. The company argued for concessions “on an equitable basis” rather than a re-evaluation of the original judgment.

Vodafone Idea Flags Insolvency Risk

The financial vulnerability of Vodafone Idea has once again come into sharp focus. As per a CNBC-TV18 report, the telco warned that without additional government support, it might not survive beyond FY26. This warning comes despite the company receiving a Rs 26,000 crore equity infusion and the government converting a significant portion of its dues into equity.

Still struggling to obtain fresh bank funding, Vodafone Idea conveyed to the Centre that the lack of financial assistance could soon compel it to file for insolvency with the National Company Law Tribunal (NCLT). The company also cautioned that such a move could render the government’s 49 per cent equity stake worthless. This stake was part of the conversion deal involving Rs 1.18 trillion in spectrum-related liabilities.

Despite the gravity of the situation, the Supreme Court refrained from intervening in the government’s decision to support telecom firms, signalling a firm stance on AGR dues and further narrowing the legal avenues available to the financially beleaguered sector.