Telcos look to free capital by settling ₹76,780 cr litigation

Vodafone Idea Ltd chief executive Akshaya Moondra said in an earnings call with investors last week that a structural change was needed to prevent avoidable litigation

- Gulveen Aulakh

Telecom service providers will pursue resolutions and reforms aimed at reducing sector-related litigation, totalling over ₹76,780 crore, arising from tax disputes and legacy matters, top executives said.

Vodafone Idea Ltd chief executive Akshaya Moondra said in an earnings call with investors last week that a structural change was needed to prevent avoidable litigation.

“We need to make a structural change that the department (income tax) should not really be raising demands in case there is a matter that has been decided favourably by a higher judicial authority. We need to make that representation stronger so that this unnecessary litigation can be avoided," he said, specifically on the income tax matters, which he noted were not limited to the telecom sector alone.

He said a large part of the amounts under litigation came from income tax matters, and even if some matters are covered by earlier judicial pronouncements by higher authorities, the demands keep on getting raised each year and are taken to the Telecom Disputes Settlement and Appellate Tribunal or TDSAT for settlement.

“Now, definitely, as an industry, we would be representing, and we keep on representing this with the relevant ministries," he said.