On Friday, Government-owned OIL India Ltd withdrew its petition seeking clarification/modification from the Supreme Court regarding the non-applicability of the judgment on Adjusted Gross Revenue to it.
Based on the October 24, 2019 judgment of the Supreme Court which held that the word "Adjusted Gross Revenue" in UAS telecom license agreements will include income from non-telecom sources as well, the Department of Telecommunications had directed OIL to shell out more than Rs 40,0000 crores with respect to the National Long Distance License given to. This amount that is to be deposited by Oil India is twice its net worth and could possibly push it into financial distress.
In this backdrop, OIL moved the SC seeking clarification.
However, Senior Advocate Mukul Rohatgi, representing OIL India Ltd., sought to withdraw the application when Justice Arun Mishra began reprimanding the defaulting companies for not paying their dues as per the order rendered by the Supreme Court on 24th October, 2019. Dismissing their petitions as withdrawn, the Court has granted them liberty to "avail appropriate remedy before appropriate forum in accordance with law, in case necessity arises".
Oil India Ltd filed a clarificatory application stating that the 24th October order "interpreted the definition of Adjusted Gross Revenue ('AGR') as provided under Clause 19.1 of the Unified Access Service ('UAS') License Agreement/Draft License Agreement, which was entered between certain telecom service providers (TSPs) and the Department of Telecommunication/Union of India."
The application sought clarification as well as modification of the interpretation as the Petitioner claims that Oil India does not fall under the ambit of a TSP, but are holders of a National Long Distance License (NLD) and thereby, are governed by a distinct license agreement.
Oil India is not the only government-owned company to face this issue. Several others, including GAIL India, PowerGrid Corporation and RailTel, are being negatively impacted due to the immense financial brunt of the judgment on Adjusted Gross Revenue delivered by the Supreme Court as they do not have sufficient liquidity to deposit the enormous dues.