Vodafone Idea misses Rs 6,090 cr bank guarantee deadline for spectrum dues

Vodafone Idea has neither provided a bank guarantee amounting to Rs 6,090.7 crore nor made a cash payment of Rs 5,493.2 crore to the Department of Telecommunications (DoT) to cover the shortfall from the 2015 spectrum auction by the stipulated deadline, according to a report by The Economic Times.

This situation could prompt the government to consider potential action.

The telecom operator, currently facing financial difficulties, was required to submit the bank guarantee or make the payment by March 10, 2025. However, it failed to do so by the close of business hours. A government official, cited by the news report, said that the government will assess what action can be taken in the next couple of days. The DoT has not yet granted any extension, the official said.

Vodafone Idea’s outstanding amount pertains to a shortfall in spectrum usage payments, calculated on a pro-rata basis in line with the bank guarantee waiver terms announced by the DoT in December 2024.

In a broader relief measure, the government had waived bank guarantee requirements worth approximately Rs 33,000 crore for spectrum acquired in previous auctions by private operators, including Reliance Jio, Bharti Airtel, and Vodafone Idea. Of this, Vodafone Idea benefited the most, with waivers totalling Rs 24,800 crore. The waiver applied to spectrum acquired in the auctions held in 2012, 2014, 2015, 2016, and 2021, provided that the pro-rata value of spectrum usage up to three months beyond the next payment due date was lower than the net present value of payments already made by the telecom operator.

Unlike Bharti Airtel and Reliance Jio, which were not required to furnish a bank guarantee due to their higher spectrum payments relative to usage, Vodafone Idea was obligated to submit a bank guarantee or make a cash payment for the 2015 auction due to a partial shortfall in payments at that time.

Vodafone Idea receives GST demand notice

Last month, Vodafone Idea Ltd (VIL) announced that it has received a Goods and Services Tax (GST) demand order amounting to Rs 16.73 crore from the Deputy Commissioner, Large Taxpayer Unit, West Bengal.

The company stated that it disagrees with the order and intends to take necessary steps to file an appeal against it.

In a filing with the Bombay Stock Exchange (BSE) detailing the order issued under the Central Goods and Services Tax Act, 2017, Vodafone Idea confirmed that it received the notice on February 27, 2025.

According to the filing, the order was “passed under Section 73 of Central Goods and Services Tax Act, 2017 read with West Bengal Goods and Services Tax Act, 2017 confirming penalty of Rs 16,73,33,489 along with demand and interest as applicable”. The order relates to the company’s alleged overuse of Input Tax Credit and underpayment of taxes, the company said.