Based on the order the Department of Telecommunications has issued demand notices to OIL seeking payment of licence fee on total reported revenue including revenue from sale of crude oil and natural gas.
State-owned Oil India Ltd (OIL), the country’s second-largest oil and gas producer, today informed it has filed a petition in the Supreme Court seeking a review of its earlier order that had broadened the definition of Adjusted Gross Revenue (AGR) for telecommunications companies to include non-core operations.
Based on the order the Department of Telecommunications (DoT) has issued demand notices to OIL seeking payment of licence fee on total reported revenue including revenue from sale of crude oil and natural gas.
OIL has so far received demand notices for the period between 2007-08 and 2018-19 amounting to over Rs 48,000 crore including licence fee, penalties and interest. The company said in a statement oil and gas production operations neither relate to the NLD licence nor can be treated as supplementary or value added services related to the NLD licence.
“OIL has taken up this matter with DoT and Ministry of Petroleum and Natural Gas along with other affected CPSEs and explained the non-applicability of interpretation of AGR to Non-Telecom Companies,” OIL said, adding it has today filed a clarificatory or modificatory petition before the apex court against its order and the next course of action will be based on the outcome of the petition.
OIL had obtained a National Long Distance Service Licence (NLD Licence) to establish Supervisory Control and Data Acquisition System (SCADA System) for managing its pipeline network used for transportation of crude oil, natural gas and petroleum products.
The NLD license is predominantly used for the SCADA system and only the spare bandwidth capacity is leased-out to other telecom operators, it said.
According to the company, the license terms dictate that the license fee is to be paid on Gross Total Revenue from services provided under the NLD license.