Jio says telcos have sufficient capacity to pay dues after SC verdict

Reliance Jio on Thursday wrote to Telecom Minister Ravi Shankar Prasad saying the incumbent operators have sufficient financial capacity to clear their liabilities, a day after writing to Cellular Operators Association of India (COAI), strongly slamming the industry body saying it was “blackmailing” to “extract relief from the government”

Read also: Supreme Court ruling on AGR may prove a death blow for telcos

Reliance Jio on Wednesday had said that the incumbent operators – Airtel and Vodafone-Idea – are shedding crocodile tears and are blaming the government for their own failures.

The latest spat is the result of the letter by COAI to the Minister on the crisis in the industry, which did not include RJio’s comments. In the letter, the industry body expressed deep concern over the Supreme Court’s ruling on Adjusted Gross Revenue (AGR), claiming that it would impact the industry’s ability to make further investments, which in turn would lead to decline in service quality, a possible monopoly and jeopardising government initiatives.

Therefore, Reliance Jio wrote to Prasad saying it does not agree with ‘even a single contention that COAI’s letter, which has been submitted with undue haste’ without waiting for its view on the matter.

“We submit that such obstinate behaviour by COAI, despite of Reliance Jio requesting it to wait for its views, has been compelled us to present our views separately on the matter,” Jio said in its letter to the Telecom Minister.

“We submit that COAI has used threatening and blackmailing tone with the government by referring to possible job loss, quality of service loss and loss of investment in the sector and its contentions border on contempt of Supreme Court judgement, especially when the Supreme Court has prescribed three months’ time to deposit the due amounts,” it said.

It reiterated that COAI does not represent the industry and is ‘just a mouthpiece’ of two service providers and therefore, strongly urge the government ‘not to accept COAI as an association of telecom service providers and its representation ‘should not be considered as industry representation’.

“The extraordinary scenario painted by COAI in this letter is just a machination to extract the relief from the government, when all their legal recourses have expired. We submit that these service providers are themselves responsible for this issue, they were aware of the government’s position and Supreme Court’s position as early as 2008 and 2011, however, in a most cavalier manner they continued to pay government dues, as per their own interpretation, and thus fully responsible for the current obligations emerging of SC order,” Jio added.

In view of all the above reasons, Jio requested the government to reject COAI demand for a financial relief on the SC judgement and their other outstanding liabilities including the spectrum payments, etc and all operators should be mandated to deposit applicable amounts within the three months time period, as mandated by the SC.

And, instead of all these debate, Jio said that the government should rather consider other industry issues of prospective rationalisation of levies and taxes as envisaged in the National Digital Communications Policy (NDCP)-2018 and GST credit separately and ‘not permit COAI’ to intermix the investment infusing financial package for industry by mixing it with the legitimate license free and SUC obligation arising out of past condust of operators.

The copies of the letter was marked to Principal Secretary and Principal Advisor to the Prime Minister, CEO Niti Aayog, Cabinet Secretary and Secretariesat Telecom Department, Ministry of Finance, Ministry of Law & Justice and Member Finance at DoT.