{"id":221506,"date":"2019-10-25T16:37:50","date_gmt":"2019-10-25T11:07:50","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=221506"},"modified":"2019-11-02T12:49:12","modified_gmt":"2019-11-02T07:19:12","slug":"in-a-big-blow-to-the-telecom-sector-sc-refuses-to-change-agr-definition-full-report","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2019\/10\/25\/in-a-big-blow-to-the-telecom-sector-sc-refuses-to-change-agr-definition-full-report\/","title":{"rendered":"In a big blow to the Telecom Sector, SC refuses to change AGR definition [Full report]"},"content":{"rendered":"

Supreme Court<\/strong>: Refusing to change the definition of gross revenue as defined in clause 19.1 of the licence agreement granted by the Government of India to the Telecom Service Providers, the 3-judge bench of Arun Mishra, SA Nazeer and MR Shah, JJ has said,<\/p>\n

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\u201cThe definition of revenue has been taken in a broad, comprehensive, and inclusive manner to pose fewer problems of interpretation, and exclusion of certain items was avoided.\u201d<\/p>\n<\/blockquote>\n

The Court agreed that to a certain extent, it cannot be disputed that to have clarity, uniformity, and definitiveness; the accounting standards lay down guidelines with respect to financial terms. It, however, said that when the financial terms in the agreement are clear in the form of definition of gross revenue governed by Clause 19.1 of the agreement, the definition of Accounting Standard\u00ad9 cannot supersede it which is a general one.<\/p>\n

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\u201cThe definition in agreement is unambiguous, clear, and beyond the pale of doubt, and there is no confusion in the definition of gross revenue, which is the basis for realisation of the licence fee. Licensees have made a futile attempt to wriggle out of the definition in an indirect method, which was rejected directly in the decision of 2011 between the parties and it was held that these very heads form part of gross revenue.\u201d<\/p>\n<\/blockquote>\n

The Court further noticed that the parties had agreed to various inclusions in the agreement and have willingly switched over to revenue\u00ad sharing regime under the National Telecom Policy, 1999. TSPs agreed to interpretation and accepted it as held by this Court in 2011 judgment.<\/p>\n

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\u201cThe deliberations were held with the licensees, experts, and then finally migration package, revenue sharing regime is being consented to, was worked out in which the definition of adjusted gross revenue as a part of the financial condition of the licence is mentioned.\u201d<\/p>\n<\/blockquote>\n

Going through the chequered history on the case, the Court noticed:<\/p>\n