Key Highlights

Vodafone Idea shares rose 9% after the Centre told SC “some solution is required” on AGR dues.
The next Supreme Court hearing on September 26 will address additional AGR demands.
Vodafone Idea says ₹5,606 crore of new demand relates to FY17 and is already settled.
DoT recalculated dues, raising claims of nearly ₹9,450 crore.
Telco warns that added liability threatens survival, services to 198 million subscribers, and the jobs of 18,000 employees.

Supreme Court Sets September 26 Hearing

Vodafone Idea’s long-running Adjusted Gross Revenue (AGR) case has returned to the spotlight, with the Supreme Court scheduled to hear the matter again on September 26. The proceedings will focus on the government’s fresh AGR demands, which the telecom operator has contested.

The latest development saw Vodafone Idea’s shares climb by 9 percent, buoyed by the Centre’s statement before the Court that “some solution is required” to address the additional dues dispute.

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Background of the AGR Dispute

The current case originates from the Supreme Court’s March 18, 2020 order, which upheld the Department of Telecommunications’ (DoT) calculation of AGR dues up to FY17. That ruling explicitly disallowed any reassessment of AGR liabilities by telecom operators for the period up to FY17, effectively crystallising the amounts owed.

Vodafone Idea has since argued that DoT’s new claims overlap with the periods already settled by the 2020 judgment, making them legally untenable.

Vodafone Idea’s Plea Against New Demands

In its petition filed on September 8, Vodafone Idea challenged the DoT’s revised demands. The company said that ₹5,606 crore of the fresh demand relates to years up to FY17, which were already covered by the Supreme Court’s 2020 ruling.

Vodafone Idea asked the Court to quash these claims and called for a full reconciliation of its AGR dues to avoid duplication.

The company also cautioned that the added liability could threaten its survival, putting at risk services to its 198 million subscribers and the livelihood of over 18,000 employees, apart from thousands of indirect jobs dependent on the operator.

DoT’s Revised Computation of AGR Dues

According to filings, the Department of Telecommunications issued a fresh demand notice totaling ₹9,450 crore. Of this, ₹2,774 crore has been raised against Idea Group and Vodafone Idea (post-merger), while ₹6,675 crore has been directed at Vodafone Group for the pre-merger period.

DoT’s revised math covers both licence fees and spectrum usage charges. It argued that its recalculated figures include penalties and interest up to October 2019, with further compounding at 8 percent annually until March 2025.

In its communication dated August 13, DoT stated that updated licence fee dues up to FY19 were not factored into the Court’s earlier September 1, 2020 order. On this basis, it defended raising fresh claims for FY18 and FY19 as part of its revised assessment.

Vodafone Idea’s Response to DoT

Vodafone Idea rejected the revised figures in its reply submitted on August 28. The company stated that it accepted no liability beyond interest on ₹58,254 crore, which was already determined.

It highlighted what it described as “material errors” in DoT’s computation of AGR dues for FY18 and FY19. The telco said that if spectrum charges up to FY17 were included, additional dues would amount to about ₹6,800 crore as of March 2025. Yet, DoT’s demand far exceeded this calculation, according to the operator.

Vodafone Idea’s Existing AGR Burden

Vodafone Idea’s financial stress is already significant. The operator owes around ₹83,400 crore in AGR dues, with annual instalments of ₹18,000 crore beginning from March.

When penalties and interest across various liabilities are included, the company’s total obligations to the government are estimated at nearly ₹2 trillion.

This massive debt burden has left Vodafone Idea with limited room to absorb additional demands, a fact repeatedly stressed in its submissions before the Court.

Government Stake in Vodafone Idea

The government itself is now the single-largest shareholder in Vodafone Idea. It currently owns 48.99 percent of the company, following the conversion of ₹53,083 crore worth of dues into equity. This conversion was executed in two tranches, first in February 2023 and later in April 2025.

The government’s ownership adds a layer of complexity to the dispute, as the state is simultaneously a major creditor through AGR dues and a shareholder through its equity stake.

Survival Concerns Raised by Vodafone Idea

In its petition, Vodafone Idea reiterated that the survival of the company is at stake. It argued that imposing additional AGR dues would directly jeopardise its operations, impacting millions of subscribers and thousands of employees.

The telco emphasized that continuity of services for its 198 million users is critical, and any disruption could have wider consequences for the telecom sector.

Next Steps in Supreme Court Proceedings

With the matter listed for September 26, all eyes will be on the Supreme Court’s handling of DoT’s revised AGR demand and Vodafone Idea’s plea to quash overlapping claims.

The Court is expected to examine whether the fresh demands raised by DoT are consistent with its March 2020 order, which had ruled out reassessment of dues up to FY17.

Until then, Vodafone Idea’s share price movement is likely to remain sensitive to developments in the case, as investors weigh the implications of the additional liabilities against the possibility of judicial relief.

Conclusion

The Vodafone Idea AGR case has reached a critical juncture once again. While the Supreme Court had settled the matter up to FY17 in its 2020 ruling, DoT’s recalculated claims for FY18 and FY19 have reignited the dispute.

Vodafone Idea has contested the fresh demands, arguing that they overlap with already crystallised dues and contain computational errors. With AGR liabilities already exceeding ₹83,400 crore and overall government obligations nearing ₹2 trillion, the telco insists that additional dues would threaten its very survival.

The government, now holding nearly 49 percent equity in Vodafone Idea, has also acknowledged the need for a solution. The upcoming September 26 hearing will be decisive in shaping the future of the operator and its ability to sustain operations in India’s competitive telecom market.