Communication gap behind DoT seeking Rs 3 trn from non-telco PSUs: Pradhan

The Department of Telecommunications seeking nearly Rs 3 trillion in dues from non-telecom PSUs, such as GAIL, Oil India Ltd and PowerGrid, was a result of "communication gap" as these firms do not owe any such amount, Oil Minister Dharmendra Pradhan said on Thursday.
Following the October 24 Supreme Court ruling that non-telecom revenues of telecom firms such as Bharti Airtel and Vodafone Idea should be included for considering payments of government dues, the telecom department sought Rs 1.72 trillion from gas utility GAIL India Ltd, Rs 48,000 crore from OIL, Rs 40,000 crore from PowerGrid and raised similar demands from RailTel and other public sector undertakings (PSUs).
The government's demand from such companies increased many times more than their net worth and the Centre asked them to go to the Supreme Court against such dues. While Oil India Ltd filed a clarificatory/ modificatory petition on Wednesday, GAIL approached the apex court on Thursday.
"We are in discussion with the telecom ministry. We had given them our reply (on the demand raised)," Pradhan told reporters here. "Possibly because of communication gap, the Government of India's one department has raised such demand on PSUs under another government department."
He said parallel to discussions with the DoT, the Supreme Court has been approached on the issue.
"Where is GAIL in core telecom work? Is PGCIL in core telecom work or does Oil India do any core telecom job," he asked. "We feel there should be no impact (of the October 24 Supreme Court ruling) on these companies."

Pradhan said the approach to the Supreme Court and discussions with the DoT were being conducted simultaneously.
He, however, did not say if seeking relief from the Supreme Court was limited to PSUs under his ministry filing pleas in the apex court or his ministry would also file a petition.
The DoT raised the demands on the non-telecom PSUs for leasing out surplus optical fibre network that was primarily for their internal communications under NLD (National Long Distance Service) licences or IP-1/IP-2.
The demand notices by the DoT follow the Supreme Court's October 24 order that broadened the definition of adjusted gross revenue (AGR) for telecommunications companies to include non-core operations. AGR is used as a basis for the calculation of licence fees and spectrum usage charges owed to the government. GAIL, Oil India, PowerGrid and other non-telecom PSUs were not a party to this litigation.
OIL in its petition to the Supreme Court stated that it will have to shut down operations if it is forced to pay an amount that is twice its net worth.
"OIL had obtained a National Long Distance Service Licence (NLD Licence) to establish supervisory control and data acquisition system (SCADA system) for control, management, and protection of OIL's pipeline network used for transportation of crude oil, natural gas, and petroleum products," the company had said in a statement on Thursday. "As per the licence terms, the licence fee is to be paid on gross total revenue from services provided under the NLD Licence. Since the award of NLD licence, the cumulative revenue of Rs 1.47 crore is earned by OIL from the leasing of spare bandwidth capacity on which all applicable licence fee and other statutory dues as per licence terms have been paid by OIL regularly."
The company stated that based on the recent Supreme Court ruling, "Department of Telecommunications issued demand notices to OIL also seeking payment of licence fee on total reported revenue including revenue from sale of crude oil, natural gas etc, which neither relate to the NLD licence nor can be treated as supplementary/ value-added services related to the NLD licence."
"Till date, OIL has received demand notices for the period from FY2007-08 to FY2018-19 amounting to over Rs 48,000 crore including licence fee, penalties and interest," the statement had said.
From gas utility GAIL, the DoT has sought Rs 1,72,655 crore in dues on IP-1 and IP-2 licences as well as internet service provider (ISP) licence. In response, GAIL has told the DoT that it owes nothing more than what it has already paid to the government.
The firm told the DoT that it had obtained ISP licence in 2002 for a period of 15 years, which expired in 2017. But GAIL never did any business under the licence, and since no revenue was generated, so it cannot pay any amount.
On IP-1 and IP-2 licences, GAIL has told the DoT that it generated Rs 35 crore of revenue since 2001-02 and not Rs 2,49,788 crore that has been considered for levying past dues, adding that the revenue number the DoT is considering is after adding all the revenues that the company earned from gas trading and transportation business.
Sources said the dues being sought are more than three times the net worth of GAIL and several times the actual revenue earned.
While telecom companies such as Bharti Airtel and Vodafone Idea may have had non-telecom revenues generated from using the government licence and spectrum, firms such as GAIL and OIL had no such revenue.
The DoT is seeking Rs 1.47 trillion from all telcos in past statutory dues.

GAIL to invest over Rs 45,000 cr to create infra for gas-based economy

GAILIndia Ltd, the country's largest gas utility, plans to invest over Rs 45,000 crore over the next five years to expand the National Gas Pipeline Grid and city gas distribution network to help push for greater use of environment-friendly fuel, its chairman Ashutosh Karnatak said.
The gas pipelines are planned to take the fuel to the east and northeast regions as well as to consumers in the south as part of the government push to raise the share of natural gas in India's energy basket to 15 per cent by 2030 from the current 6.2 per cent, he said.
GAIL's push for the creation of infrastructure is in line with Prime Minister Narendra Modi's vision of creating a gas-based economy that is less reliant on polluting fuels for meeting its energy needs.
"Before we transition to zero-emission technologies (for both automobiles and factories) say by 2040/2050, natural gas is best suited for tapering emissions from current levels," he said. "Natural gas is 'happy fuel' as it has a fraction of emissions compared to alternate liquid fuels such as diesel in automobiles and coal in power plants."
India currently consumes some 160 million standard cubic meters of gas per day and consumption has to rise to 400 mmscmd to reach 15 per cent share in the energy mix, he said, adding GAIL is playing its responsibility by creating the infrastructure for the same.
GAIL currently operates 12,160-km of pipeline network and markets two-thirds of all-natural gas sold in the country. It is currently executing more than 5,500 kilometers of pipeline projects and a similar length is at the planning stage.
Karnatak said the projects at hand include the ambitious Urja Ganga Project to take gas to Bihar, West Bengal, Odisha, and Jharkhand as well as Kochi-Kootanad-Bangalore-Mangalore line and the Indradhanush North East Gas Grid. "These pipelines will connect supply and demand centers envisaged under the National Gas Grid."

Besides pipelines, GAIL is also expanding city gas distribution (CGD) networks for retailing of CNG to automobiles and piped natural gas to household kitchens. Investments are also planned for the expansion of petrochemical plants.
GAIL is looking to put up 400 CNG stations and give out a record 10 lakh piped natural gas (PNG) connections to household kitchens in the next 3-5 years.
The company is building a 2,655-km gas pipeline from Jagdishpur in Uttar Pradesh to Haldia in West Bengal, Bokaro in Jharkhand and Dhamra in Odisha. "Pipeline up to Patna has already been commissioned and the rest of the project will be completed by end 2020," he said.
Jagdishpur-Haldia & Bokaro-Dhamra Natural Gas Pipeline (JHBDPL) project, also known as the 'Pradhan Mantri Urja Ganga' project, was inaugurated by the Prime Minister in July 2015. GAIL has commenced city gas operations in all the six geographical areas (GAs), including in Patna and Bhubaneshwar, that was awarded to it along the Urja Ganga route, he said.
The pipeline will be extended to Guwahati by laying an additional 750-km line. At Guwahati, it would interconnect with the upcoming 1,500-km 'Indradhanush' pipeline network conceived to operate in the northeast region by the public sector oil and gas majors.
GAIL will also lay a 600 km Srikakulam-Angul natural gas pipeline.
"Renewable power is set to grow to 227 GW by 2030 and gas has a complementary role in effectively addressing intermittency and supplying peaking load," Karnatak said, adding gas-based power generation can take over during the night or on not so sunny days in areas getting solar power and also supplement hydro and wind projects during downtime.
He said 20-22 GW of coal-fired power plants are obsolete and 25 GW of stranded gas power assets could be utilised to help meet the carbon emission objectives of India, he noted.
Gas can also be used as fuel in steel plants, oil refineries, industries, and transportation, he said, estimating that power sector alone would need 100 mmscmd of gas and 50-55 mmscmd each would go for city gas distribution and fertiliser plants. Steel plants and refineries can consume 70 mmscmd between them.

Relief to non-telecom firms on AGR dues can only come from SC: Report

After sending out notices to firms such as gas utility GAILfor crores of rupees in past dues, the Department of Telecommunications has said that any relief to non-telecom companies from payment of enhanced levies can come only from the Supreme Court.
The Telecom Department is current "examining" the replies given by the state-owned non-telecom corporations on the Adjusted Gross Revenue (AGR) dues, a senior official said.

"They have sent their replies, which we are examining. We believe that they will have to go to Supreme Court to seek notification or clarification on whether they are included or not included in this (Supreme Court order). That is for them to seek," the Telecom Department official told PTI.
There are certain cases where players were parties in the court and in those cases the companies are bound by the court order. Some parties have also filed review petition, the official noted.
"Then there were others who were not parties, they will have to take a call because our assessment is that it will be applicable...we are examining the issue but in our assessment they will probably have to go to SC to seek a clarification," the official added.
As it is, Bharti Airtel, Vodafone Idea and other telecom companies owe the government nearly Rs 1.47 trillion in past statutory dues. These AGR liabilities arose after the Supreme Court in October this year upheld the government's position on including revenue from non-telecommunication businesses for calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fees to the exchequer.
The apex court allowed three months to the affected companies to cough up the amounts due to the government.
The Department of Telecommunications (DoT) has meanwhile made it clear that the AGR order will apply to all licencees, including companies such as GAIL, RailTel, and Power Grid.
As things stand today, such players, despite a smaller telecom exposure, may have to pay liabilities computed on their entire revenue.
Non-telcos, such as internet service providers (ISPs), had argued that DoT has unnecessarily imposed the order on internet service providers, many of which are run by entrepreneurs in smaller cities and towns. It had also sought intervention of the Prime Minister's Office (PMO) to resolve this issue.
The DoT has sought Rs 1.72 trillion in past statutory dues from state-owned gas utility GAIL India Ltd following the Supreme Court's AGR ruling.
DoT sent a letter to GAIL last month seeking Rs 1,72,655 crore in dues on IP-1 and IP-2 licences as well as Internet Service Provider (ISP) licence. In response, GAIL has told DoT that it owes nothing more than what it has already paid to the government.
Besides GAIL, DoT is also seeking Rs 1.25 trillion from PowerGrid which had both a national long-distance as well as an internet licence. PowerGrid says it has an AGR of Rs 3,566 crore since 2006-07 and after adding penalty it comes to Rs 22,168 crore.