Vodafone Idea Moves SC To Quash Rs9,450 Crore AGR Demand, Cites Duplication and Settled Dues

Moneylife Digital Team 11 September 2025

Economy & Nation

Vodafone Idea Ltd has approached the Supreme Court seeking to quash a fresh adjusted gross revenue (AGR) demand of Rs9,450 crore raised by the department of telecommunications (DoT), arguing that the dues exceed the scope of the apex court’s 2020 ruling that had settled liabilities up to FY16-17. Despite the government’s conversion of over Rs53,000 crore of dues into equity providing temporary relief, Vodafone Idea remains heavily reliant on fresh funding and judicial relief to sustain operations.

The telecom operator’s petition, filed on 8 September 2025, challenges DoT’s revised calculations covering dues up to FY18-19 and updated licence fee obligations for both Idea Cellular and Vodafone Idea Ltd following their merger in August 2018.

According to Vodafone Idea, of the total Rs9,450 crore demand, around Rs2,774 crore relates to the post-merger entity, while Rs5,675 crore pertains to liabilities of the pre-merger Vodafone group. The company has highlighted that about Rs5,606 crore, as of 31 March 2025, relates to the pre-FY16-17 period that the Supreme Court had already locked through its March 2020 ruling.

That judgement had ruled out any reassessment or self-assessment of dues prior to FY16-17, fixing the AGR liabilities of telecom operators based on DoT’s calculations. Vodafone Idea now contends that the latest demand contradicts that order, as it attempts to re-open settled accounts.

The fresh DoT demand also includes Rs2,774 crore for FY18-19. Vodafone Idea alleges this figure contains duplication and inconsistencies and has sought reconciliation under the deduction verification guidelines issued in February 2020.

In its plea, Vodafone Idea warned that the additional liability 'threatens the very existence' of the debt-laden telco which currently serves about 198mn (million) subscribers and employs over 18,000 people. The operator argued that enforcement of these dues could derail its fundraising efforts to strengthen 4G networks and accelerate 5G rollouts, critical to competing with Reliance Jio and Bharti Airtel.

Vodafone Idea’s total outstanding liabilities, including AGR dues, spectrum instalments, interest and penalties, are estimated at nearly Rs2tn (trillion) through FY33-34. Under the government’s four-year moratorium, AGR instalments of Rs16,428 crore are set to begin on 31 March 2026, alongside spectrum payments of Rs2,641 crore by June 2026.

In September last year, the Supreme Court had earlier dismissed a similar plea, when telecom operators, including Vodafone Idea, flagged errors in AGR computations amounting to over Rs1 lakh crore. At that time, Vodafone Idea’s liability was pegged at Rs58,254 crore.

The company’s latest petition also seeks directions for a comprehensive reassessment and reconciliation of AGR dues up to FY16-17, contending that failure to follow verification guidelines has inflated its dues.

Vodafone Idea continues to report heavy losses, with a net loss of Rs6,608 crore for the quarter ended 30 June 2025, against Rs6,426.7 crore a year earlier, primarily due to higher finance costs. The company is in advanced talks to raise about Rs5,000 crore in debt financing through its subsidiary, Vodafone Idea Telecom Infrastructure Ltd, to bolster its capital base.

The Supreme Court is expected to hear the petition in the coming weeks.

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