Delay hits Airtel, Tata Teleservices merger; unlikely to get govt nod this year as deal caught in AGR dues controversy

  • Airtel and Tata Teleservices are reportedly in the exercise of making self-assessment of their AGR dues as demanded by the DoT

  • Last month, the DoT had approached the Supreme Court against the TDSAT decision that mandated it to clear the merger deal between Bharti Airtel and Tata Teleservices

  • In November this year, the telecom department had directed all circle heads to treat Bharti Airtel and Tata Teleservices as separate entities

The much-awaited merger of Airtel and Tata Teleservices is yet to take place as the deal has not received government sanction, said a news report.

Since both the companies have to clear the adjusted gross revenue (AGR) dues before inking the pact, it is expected that government's clearance is unlikely this year, said a report in The Times of India.

Airtel and Tata Teleservices are reportedly in the exercise of making self-assessment of their AGR dues as demanded by the Department of Telecom (DoT). They are also planning to approach the government with a plea to give clearance for the merger as early as possible, the report said quoting people in the know of the matter.

The dues of Airtel is estimated to be around Rs 35,000 crore while Tata Tele owes around Rs 13,000 crore, the report said.

 Delay hits Airtel, Tata Teleservices merger; unlikely to get govt nod this year as deal caught in AGR dues controversy

Representational image. Reuters.

Last month, the DoT had approached the Supreme Court against the Telecommunications Dispute Settlement and Appellate Tribunal’s (TDSAT) decision that mandated it clear the merger deal between Bharti Airtel and Tata Teleservices, said a report in The Economic Times.

The DoT sought dues to the tune of over Rs 8,000 crore on account of one-time spectrum charges (OTSC) and said in its appeal to the apex court that the demand was based on licence conditions, the report said, quoting people aware of the matter.

DoT directive

In November this year, the telecom department had directed all circle heads to treat Bharti Airtel and Tata Teleservices as separate entities, as it is in the process to challenge their merger in the Supreme Court.

The DoT had also asked all its entities to deal with the customer acquisition process and all compliance-related issues of both the companies as separate companies.

Bharti Airtel on 1 July announced that the consumer mobile business of Tata Teleservices Ltd (TTSL) has now become a part of the company.

In October this year, the Supreme Court had ruled that telcos will have to pay all penalties and interests to the government, in a setback to telecom service providers.

The apex court allowed the Centre's plea to recover AGR of about Rs 92,000 crore from the service providers.

With inputs from agencies

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Updated Date: Dec 27, 2019 15:21:55 IST