Oil India Limited gets notice for payment of license fee, files Court petition
Dibrugarh: Oil India Limited (OIL) has obtained a National Long Distance Service Licence (NLD Licence) to establish the 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 NLD license is predominantly used for the SCADA system and only the spare bandwidth capacity is leased-out to other telecom operators.
As per the license terms, license fee is to be paid on Gross Total Revenue from services provided under the NLD license. Since the award of an NLD license, the cumulative revenue of Rs.1.47 crore is earned by OIL from the leasing of spare bandwidth capacity on which all applicable license fees and other statutory dues as per license terms have been paid by OIL regularly.
However, according to OIL’s press communiqué, based on the recent Supreme Court judgment on dispute raised by Telecom Service Providers (TSPs), whereby the apex Court decided that entire revenue of licensee should be considered for determining AGR, Department of Telecommunications has issued demand notices to OIL also seeking payment of license fee on total reported revenue, including revenue from sale of crude oil and natural gas, which neither relate to the NLD license nor can be treated as supplementary/ value-added services related to the NLD license.
To date, OIL has received demand notices for the period from FY 2007-08 to FY 2018-19 amounting to over Rs. 48,000 crores including license fee, penalties, and interest. OIL has taken up this matter with the Department of Telecommunications 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 filed a petition on January 22 before the Supreme Court to this effect.