As per a note by Credit Suisse, the government’s potential withdrawal of its petition regarding one-time spectrum charge (OTSC) and settling disputes with telcos outside court on the lines of its ‘Vivaad se Vishwas’ scheme can go a long way to reduce litigations for the telecom sector.
The statement comes after the Supreme Court adjourned hearing on the OTSC case till November 17, 2021 after the Department of Telecommunications (DoT) sought another three weeks to reconsider continuing with its appeal in the OTSC case.
According to Credit Suisse, Bharti Airtel and Vodafone Idea Limited (Vi) have made provisions for 67 per cent and 53 per cent of the total OTSC demand by the government. However, any settlement with the government at amounts lower than the provisions created will likely lead to a reversal of provisions and exceptional gains for these telcos, the brokerage firm said.
Further, Credit Suisse added that it is unlikely that any new (settlement) scheme between the government and the telcos will be able to reduce existing adjusted gross revenue (AGR) or spectrum debt dues.