Vi Pays Remaining Licence Fee To DoT After Show-Cause Notice


Vi (Vodafone-Idea) has finally cleared all its license fee dues from the last quarter of the previous financial year. This development comes soon after the Department of Telecommunication issued a show-cause notice to the telecom operator for not paying the licence fee for seven circles. The telecom ministry wants Vi to pay a license fee for Gujarat, Odisha, J&K, Kerala, Maharashtra, UP-East, and Bihar.

Vi Pays Remaining Licence Fee To DoT After Show-Cause Notice


"Failure to perform any obligation(s) under the licence including timely payment of licence fee and other charges due to licensor is a breach of a licence agreement as per the terms and conditions of the licence agreement," the ministry said.

According to the notice, all telecom operators have to clear the licence fee by March 25. Under the Unified Licence Agreement, the Department of Telecommunication is allowed to cancel the operators' bank guarantees and license. On the other hand, Vi claims that this is a regular practice and each operator has to calculate the revenues before clearing licence fee.

"Generally, payment is made on 15th day of the month following the quarter-end, but in the fourth quarter an estimated payment is required by March 25, but the license also allows payment (towards licence fees for the fourth quarter) to be made with interest on April 15," Vi added.

Vodafone-Idea Fundraising Plans

It is worth noting that Vi is expected to raise funds to clear its dues. The telecom operator is likely to raise between Rs. 14,500 to Rs. 18,100 crores from international companies; however, Vi has not shared anything on the same. Besides, India's third-largest telecom operator has increased the prices of postpaid plans in the country to increase its revenue.

Furthermore, the balance sheet of the telecom operator is weak, which is why Vi has increased prices. The telecom operator is losing customers every quarter, whereas Airtel and Reliance Jio added 5.9 million and 2 million customers in January as per TRAI data. Apart from clearing its dues, the telecom operator needs to upgrade its 4G services in the 16 circles to compete against the two biggest telecom players. Also, Vi has to pay AGR dues of Rs. 50,400 crores.

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