DoT rejects Vodafone Idea's request for 3,273 crore in license fees for FY16 and FY17

 DoT rejects Vodafone Idea's request for 3,273 crore in license fees for FY16 and FY17

Vodafone Idea told the exchanges that the Department of Telecommunications (DoT) had rejected its appeal on a license fee claim totaling 3,273 crore.

Vodafone Idea said that the DoT had rejected the company's arguments and objections in relation to licensing fee demands of 1,749 crore and 1,524 crore, respectively (including interest through 31.03.2023) for FY2015-16 and FY2016-17, in a correspondence dated October 4.

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The statement said, "The company had already written to the DoT to fix the inaccuracies in requests up to FY 2016–17, which DoT has not yet acted upon. 

Additionally, it stated that "there are various errors that need to be corrected and which would reduce the demand crystallized by the SC" if DoT is allowed to adjust the requests during the time period covered by the Supreme Court verdict. 

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"A review petition has been submitted by the company seeking directions from the SC to make a correction of these errors and the same remains to be pending.," the announcement stated. 

Background

In regards to the circles serving Bihar, Gujarat, Jammu and Kashmir, Kerala, Maharashtra, Uttar Pradesh (East), Odisha, and national long distance, the Department of Telecom (DoT) issued a showing-cause to VIL in 2021.

In accordance with the notice, DoT ordered VIL to provide justification by April 12, 2021, as to why the company should not be subject to legal action under the pertinent license agreement provisions.

According to the terms and circumstances of the license agreement, "failure to perform any obligation(s) under the licence, including timely reimbursement of licence fee and other penalties due to licensor, is a breach of licence agreement," DoT had stated in the notice.

On April 12, VIL stated in a regulatory filing that it will be sending the Telecom Department a "suitable clarification" regarding the showcause notice.

According to VIL's explanation, paying a license fee is a routine, quarterly activity based on a self-estimation of revenue for each quarter.