The department of telecommunications (DoT) is not likely to return bank guarantees (BGs) related to spectrum auctions to Vodafone Idea and Bharti Airtel anytime soon as it needs to first finalise a mechanism for securing the adjusted gross revenue (AGR) dues of the two firms. However, spectrum auction related BGs of Reliance Jio will be returned as it does not have any AGR related dues as per the Supreme Court order.

According to estimates, Vodafone Idea has spectrum related BGs worth Rs 15,000 crore while for Bharti Airtel the same is of around Rs 8,000 crore. The DoT has already started returning BGs related to licence fees and so far returned BGs worth Rs 9,000 crore to the companies.

But since the DoT has not securitised AGR related dues, it is considering to hold back spectrum auction related BGs till a final decision is taken in this regard, sources said. The government is treading cautiously because of the Supreme Court order which states that telecom operators have to pay the AGR dues along with interest and penalty as calculated by the DoT.

In September 2020, the Supreme Court had ordered that the companies need to pay their dues over a 10-year period, after paying 10% of the dues upfront by March 31, 2021. Thereafter, the deferred payment cycle would run till 2031 with the 10% amount to be paid by March 31 every year. As per DoT’s calculations, total AGR dues of Bharti Airtel stood at Rs 43,980 crore, of which the company had paid Rs 18,004 crore. Vodafone Idea dues stood at Rs 58,254 crore, of which the firm had paid Rs 7,854 crore.

After the telecom relief package, requirement of BGs has been lowered by 80%. It also meant that past BGs related to deferred spectrum installments as well as licence fees etc will be returned to operators. But since, there is no clarity regarding the AGR dues and how to secure the amount, the DoT has not yet started to return auction related BGs.