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Relief for Vodafone Idea as Supreme Court allows relook at ₹2 lakh crore dues
Vodafone Idea's share price rose to the highest since September 2024 after the Supreme Court allowed a relook at its dues and debt totalling ₹2 lakh crore.
The Supreme Court of India has allowed the central government to reconsider billions in past dues of Vodafone Idea Ltd., rekindling revival hopes for what was once India's largest telecom operator.
The matter of Vodafone Idea's AGR dues falls within the purview of the Union of India, a Supreme Court bench headed by Chief Justice of India B.R. Gavai said on Monday. “We clarify that this is in the policy domain of the Union… There is no reason as to why the Union should be prevented from doing so,” Gavai said. “With that view of the matter, we dispose of the writ petition.”
The Supreme Court's order came after Solicitor General of India Tushar Mehta said that the government picked up a 49% equity stake in the company in lieu of some of the dues. “There are 20 crore consumers. That was one of the decisions why the central government took this decision,” Mehta told the top court. “The consumers would suffer…they have concerns…”
The Supreme Court said the order was being passed only because the Centre had infused equity in the company by acting in the interest of consumers.
Vodafone Idea's share price rose as much as 10% on the Supreme Court's ruling, touching the highest level since September 2024.
What is Vodafone Idea AGR case?
AGR stands for adjusted gross revenue, which is used by the Department of Telecommunications to calculate licence fees and spectrum-usage charges for telecom operators.
The method of AGR calculation has been contested—operators say that only “core telecom revenue” should count. The DoT maintains that non-telecom revenue—rental income, asset sales, etc.—must be included.
- In an October 2019 order, the Supreme Court held that DoT's interpretation was correct, thus significantly raising the AGR dues for telecom players.
- On 18 March 2020, the Supreme Court finalised Vodafone Idea's AGR dues up to FY17 based on DoT’s calculations, and barred reassessment or self‐assessment of those dues.
- On 30 March 2025, the government picked up a 48.99% stake in Vodafone Idea, in a debt-to-equity swap worth ₹36,950 crore.
- In May 2025, the Supreme Court rejected Vi's and other telecom operators’ petitions seeking waiver of interest/penalties on AGR dues.
As on date, Vodafone Idea's AGR dues are estimated at ₹83,400 crore. The total debt—including penalties, interest, spectrum and licence fee, etc.—is at around ₹2 lakh crore.
Vodafone Idea relief package?
Any substantial reduction in debt will be a lifeline for Vodafone Idea which hasn't reported a quarterly profit since 2016 when Vodafone India Pvt. Ltd. merged with Aditya Birla Group's Idea Cellular Ltd. That was a result of an industry-wide consolidation triggered by Reliance Jio Infocomm Ltd., which launched operations in that year, offering voice and data for free.
Vodafone Idea has argued that the burden of the AGR dues threatens its survival, and that it “cannot operate beyond FY26” without relief.
On 6 October, Bloomberg News reported that the government is considering a one-time settlement for Vodafone Idea.
Resolution in the nearly ₹2-lakh crore financial dispute may come through a waiver of interest and penalties, followed by a concession on the principal, Bloomberg News reported citing people familiar with the matter. Officials are drafting the framework and also weighing steps to ensure any deal doesn’t spark legal challenges from other telecom operators that owe dues.
To be sure, the government is not considering raising its stake in Vodafone Idea beyond the existing 49%, Hindustan Times reported on 11 October.
“We are a 49% equity holder. We do not, at this point of time, in the near future, believe in increasing our equity stake,” the report quote Telecom Minister Jyotiraditya Scindia as saying at the India Mobile World Congress.
