Reliance Jio says telecom service providers have financial capacity to pay govt dues2 min read . Updated: 31 Oct 2019, 06:15 PM IST
- Reliance Jio said the service providers have sufficient financial capacity to pay the govt dues by monetising their existing assets/investments and by issuing fresh equity in their firms
- Jio said the TSPs have wilfully violated all disclosure norms continuously since 2011 by not provisioning for these liabilities
NEW DELHI : Reliance Jio Infocom on Thursday wrote to top government functionaries, stating that telecom operators, Airtel and Vodafone Idea, have sufficient financial capacity to pay the dues to the government by monetising assets and issuing fresh equity.
In response to the missive by the Cellular Operators Association of India (COAI) seeking urgent relief for these service providers, Reliance Jio wrote a letter to Telecom Minister Ravi Shankar Prasad, a copy of which was marked to the Prime Minister's Principal Secretary, P.K. Mishra, Prime Minister's Principal Advisor, P.K. Sinha, Niti Aayog CEO Amitabh Kant, Cabinet Secretary Rajiv Gauba, Telecom Secretary Anshu Prakash, Economic Affairs Secretary Atanu Chakraborty, Law Secretary Anoop Kumar Mendiratta, and Member, Finance, Department of Telecom, P.K. Sinha.
In the letter, Reliance Jio wrote: "We submit the so-called affected service providers have sufficient financial capacity to pay the government dues by monetising their existing assets/investments and by issuing fresh equity in their companies." Although it did not name Airtel and Vodafone Idea, it is implicit that the reference is to these private operators.
"These service providers have stakes in many profitable ventures in the country and abroad and have made multi-million dollars of profits in the countries post investing the proceeds from the telecom business including the regulatory levies withheld for decades," Reliance Jio said.
Making the argument about financial ability to pay, it said that the telecom assets of these service providers have been further divested in their profitable telecom tower ventures like Indus Towers and Bharti Infratel.
"Moreover, these operators have 'Principals' with sound financial positions and they must step in to clear the dues which were withheld by them and utilised elsewhere. Thus there is no constraint of making funds available to pay-off their legal obligations, the issue seems to be only with the intent, which is being manifested by COAI through its letter," the letter reads.
It pointed out the service providers are also in violation of the Indian accounting standards and have wilfully violated all disclosure norms continuously since 2011 by not provisioning for these liabilities. Reliance Jio has asked the government to take cognisance of such blatant violations and take appropriate action.
Despite the COAI's and these two operators' continued highlighting of the so-called financial stress, Reliance Jio said these service providers have chosen to continue with their below cost tariffs, especially when there is no competitive pressure compelling these tariffs.
"We submit that COAI's intent of using this is an opportunity to seek non-enforcement of the Supreme Court judgement and asking for relief is strongly objected by RJIL. The Judgement of Hon. Supreme Court is final and to be implemented as law of land. These operators have capacity and enough monetization possibilities to comfortably pay government dues," Reliance Jio said in the communication to the Telecom Minister.