TRAI Recommendations On AGR

The Telecom Regulatory Authority of India (TRAI) has recommended that revenue accruing both direct and indirect from activities under the Licence should form part of adjusted gross revenue (AGR). The regulator has, at the same time, excluded revenues from verifiable non-licenced activity from AGR.

TRAI has made it clear that proper audit trails should be available for items which are to be excluded from AGR. Besides, revenue from bundled sale of goods and services should be considered as part of AGR unless sale of goods is clearly discernible and services offered remain unaltered even on a stand alone basis.

The regulator has included interest calculated on refundable deposit from subscribers; vendors credit; revenue from rent of towers/dark fibers; payment received on behalf of third parties; sale of handsets or telecom equipment bundled with telecom service; and receipt on account of ADC under AGR.

On the other hand, income from dividend; capital gains unless receipts have come from telecom activities; gains from foreign exchange fluctuations; reversal of provisions; and revenue from discernible and stand-alone sale of handset or telecom equipment which is not bundled with telecom service have been kept out of AGR.

The regulator, in its recommendations, also observed that the definition of AGR along with the `Statement of Revenue and Licence fee' appended to the respective licence agreements would need to be brought in line by department of telecommunication (DoT) with final order of TDSAT.