Overview of AGR Return Filing
The National Telecom policy liberalized the telecom sector of India in the year 1994 during this time licenses were issued to the telecom operators for a fixed. In 1999 government allowed the telecom brands to switch to a revenue-sharing model. In this revenue-sharing model. The operators will share a percentage of their adjusted gross revenue (sum of annual license fees and spectrum usage charges) with the government.
There was a lack of clarity regarding the definition of AGR where the Department of telecommunication claimed that it should include revenue from all telecom and non-telecom activities and on the other hand telecom operators claimed that AGR should be restricte to revenue generated from telecom services only. In 2019 Supreme court held AGR to have wide interpretation and be inclusive of revenue which was made from non-telecom activities. But owing to large outstanding dues, the telecoms filed a review petition in 2021, under this judgment the court has rationalised the AGR definition and now it will not include non-telecom revenue from a prospective basis.
Components of the Adjusted Gross Revenue
The components of the adjusted gross revenue for telecom operators can be divide into three
- Entry Fee –This is a one-time payment that each telecom license holder has to make to initiate the licensing process. This amount shall be cappe at a maximum of ₹ 15 crores per company.
- Annual License Fee – The license holder must also pay an annual license fee as a percentage of adjusted gross revenue. Annual license for the first year will be charged at the rate of 8% of AGR. It will be accompanied by a USO levy which is currently 5%. From the second year. The annual license fee shall be a minimum of 10% of the entry fee based on the authorized service area.
- Spectrum Usage Charges (SUC) –Telecom companies are charge a Spectrum usage charge for various bandwidths ranging from 600 MHz to 26 GHz. An operator will be charge the SUC based on the weighted average derived by the sum product of spectrum holding and applicable SUC divided by the sum total of spectrum holding.
Eligibility Criteria for AGR Return Filing in India
Any licensee granted a license under the Unified License Chapter by the Department of Telecom has to file AGR returns.
Following are the example of the said licenses –
- Unified License Virtual Network Operator (UL-VNO) License
- Unified License Internet Service Provider (ISP) License
- Unified License ACS Category B License
- National Long Distance (NLD) License
- International Long Distance (ILD) License
Documents required for obtaining AGR return filing
Following is the list of documents require to file AGR-Return:
- Authorization letter for the representative
- Certification of Incorporation
- A copy of the Telecom License
- Audited Statement of Revenue of the company
- An audit report of the company
- Copy of Books of accounts
FAQs About AGR Return Filing?
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