AGR Return Filing and Telecom Licence Fee
Every telecom licensee and authorised operator pays its licence or authorisation fee as a percentage of Adjusted Gross Revenue (AGR), self-assessed every quarter. We prepare the quarterly AGR working, the payment and the audited annual statement, and we answer the Controller of Communication Accounts when deductions are questioned.
What it is
AGR is the revenue figure on which the Department of Telecommunications (DoT) charges its fee. You start with gross revenue from the licensed or authorised service and subtract only the deductions your licence allows, such as certain charges paid to other licensed operators. The fee is a fixed percentage of what is left.
An “AGR return” is the set of filings that goes with that fee: a quarterly self-assessed statement and payment, and an audited annual statement that ties the four quarters to your published accounts. The Controller of Communication Accounts (CCA) for your area verifies the claims. Payments and statements are handled through DoT’s SARAS revenue system.
For internet, access and long distance services authorised under the Principal Telecommunication Services Rules, 2026 (published 24 June 2026), the authorisation fee is 8% of AGR. From the second year, it is the higher of 8% of AGR or 30% of the entry fee you paid. Unified Licence holders who have not migrated keep paying under their licence agreement.
Who it applies to
You sell internet service
ISPs under a Unified Licence (Category A, B or C) and operators holding the new Internet Service Authorisation, whether NSO or VNO.
You hold another principal service
Holders of unified, access, wireline access and long distance authorisations under the 2026 Rules, and older licensees in those services.
You only run network infrastructure
Under the Network Authorisation Rules, 2026, infrastructure providers, internet exchange points and similar network authorisations carry no authorisation fee. Only the mobile number portability provider pays one, at 1% of AGR.
Why it matters
Expect a wide reading of AGR
On 24 October 2019 the Supreme Court, in Union of India v. Association of Unified Telecom Service Providers of India, upheld DoT’s broad reading of AGR. Licensees then faced large back demands.
Keep non-telecom income separate
The September 2021 telecom reforms excluded non-telecom revenue from AGR on a prospective basis. Your books must show which income is which. Take a Faridabad ISP that also lets out part of its building: the rent should sit in its own ledger, not inside service income.
Pay on time, every quarter
Late licence fee attracts interest at SBI’s MCLR plus 2%, compounded annually, under the same reforms. Disallowed deductions turn into short payment, and interest runs on that too.
Documents required
Revenue records
- Service-wise revenue ledger and billing system reports
- GST returns for the period, for reconciliation
- Other income ledgers (interest, rent, sale of assets) to separate non-telecom revenue
Deduction support
- Invoices from other licensed operators for the charges you deduct
- Proof of payment for each of those invoices
- The other operator’s licence or authorisation details
Licence and statutory papers
- Licence agreement or authorisation, with the entry fee paid
- Previous quarterly statements and challans
- Audited financial statements and the auditor’s report on the AGR statement
- DSC of the authorised signatory
How it works
Close the quarter’s books
We take revenue from your books of account and billing system, split licensed-service revenue from other income, and match totals with your GST returns.
Work out AGR and the fee
We apply only the deductions the licence permits and back each one with invoice and payment proof. Then the fee: 8% of AGR, or the floor if that is higher.
Pay and file the quarterly statement
You approve the working; the fee is paid within 15 days of quarter-end and the self-assessed statement goes in with it. The fourth quarter is paid in advance by 25 March.
Reconcile the year
After the audit, we reconcile the four quarters with the audited accounts, settle the Q4 difference by 15 April, and file the audited annual statement by 30 June.
Answer the CCA
When the CCA verifies deductions or raises a demand, we prepare the reply with documents and reconciliations, and track it to closure.
Timelines
Quarters 1 to 3
Fee and quarterly statement within 15 days of the end of the quarter: by 15 July, 15 October and 15 January.
Quarter 4
Paid in advance by 25 March on estimated revenue, and reconciled with actuals by 15 April.
Annual audited statement
Due by 30 June after the financial year under the 2026 Rules. Older licences follow the date in their own agreement.
Gross revenue to AGR: what goes in
| Item | Treatment | What we check |
|---|---|---|
| Revenue from the licensed or authorised service | Included in gross revenue | Billing reports match the books and GST returns |
| Non-telecom revenue (for example interest or rent) | Excluded, prospectively, since the 2021 reforms | Separate ledgers and a clear trail |
| Charges paid to other licensed operators | Deductible only where the licence allows | Invoice, payment proof and the payee’s licence |
| Fee for the fourth quarter | Paid on estimate by 25 March | True-up by 15 April against actuals |
The exact list of permitted deductions sits in your licence agreement or authorisation. We read yours before claiming anything.
What happens if you miss it
Interest on the shortfall
Late or short payment attracts interest at SBI’s MCLR plus 2%, compounded annually. The 2021 reforms removed penalty and interest on penalty for licence fee dues.
Deductions disallowed
The CCA disallows deductions it cannot verify. In practice, this hits operators whose supplier invoices arrive late or go missing: the claim falls away and becomes a demand, with interest from the original due date.
Action on the licence
Persistent non-payment is a breach of the licence or authorisation terms. DoT can invoke the bank guarantee and take action under the terms of the grant.
Frequently asked questions
What is AGR in telecom?
AGR, or Adjusted Gross Revenue, is gross revenue from your licensed or authorised telecom service minus the deductions your licence allows. DoT charges its licence or authorisation fee as a percentage of AGR, which is 8% for internet, access and long distance services under the 2026 Rules. Since September 2021, non-telecom revenue is excluded on a prospective basis. With clean books and documented deductions, the quarterly calculation is routine.
When is the licence fee on AGR paid?
The fee is paid quarterly, within 15 days of the end of each of the first three quarters: 15 July, 15 October and 15 January. The fourth quarter is paid in advance by 25 March and reconciled with actual revenue by 15 April. We prepare each working well before the date, so you only approve and pay.
Is there a minimum fee even if revenue is low?
Yes, under the 2026 Rules the yearly authorisation fee from the second year is the higher of 8% of AGR or 30% of the entry fee. Here is the catch for a circle ISP whose sales are still slow in year two: the floor applies anyway. For an internet service authorisation, it works out to ₹3 lakh for a national area (entry fee ₹10 lakh) and ₹15,000 for a circle (entry fee ₹50,000). Older Unified Licences carry their own minimums, and we check your agreement before computing anything.
What is the annual audited AGR statement?
It is a statement of revenue and fee for the full financial year, audited and reconciled with your published accounts. Under the 2026 Rules it is due by 30 June. It shows that the four quarterly self-assessments add up to the audited figures, and explains any difference. We prepare the reconciliation and work with your statutory auditor, so the statement and the accounts tell the same story.
What deductions can be claimed from gross revenue?
Only those your licence agreement or authorisation expressly permits, such as certain charges paid to other licensed operators. Each deduction needs an invoice, proof of payment and the payee’s licence details, because the CCA verifies every claim and disallows what it cannot match. We read your licence terms first and claim nothing without paper behind it.
What did the Supreme Court decide on AGR?
On 24 October 2019, in Union of India v. Association of Unified Telecom Service Providers of India, the Supreme Court upheld DoT’s wide definition of AGR, so revenue beyond core telecom activity was included. Licensees faced large back demands as a result. The 2021 reforms later excluded non-telecom revenue going forward. For you, the lesson is simple: keep income streams separate in your books, and we help set that up.
What interest applies on late payment?
Interest is SBI’s MCLR plus 2%, compounded annually, following the September 2021 telecom reforms, which replaced MCLR plus 4% compounded monthly. The same reforms removed penalty and interest on penalty. Interest runs from the original due date, including on deductions disallowed later. If you have a past shortfall, we work out the exact interest and help you clear it in one go.
Do infrastructure providers file AGR returns?
Under the Telecommunications (Authorisation for Telecommunication Network) Rules, 2026, notified on 20 July 2026, infrastructure providers, internet exchange point providers and four other network authorisations carry no authorisation fee. Only the mobile number portability provider pays, at 1% of AGR or 30% of the entry fee, whichever is higher. Other reports may still apply under your authorisation, and we confirm them for your specific case.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
There is no separate government fee for filing the AGR statement. What you pay DoT is the authorisation or licence fee itself: 8% of AGR under the 2026 Rules, with the 30%-of-entry-fee floor from the second year.
Ready to begin?
Send us last quarter’s revenue ledger and your licence terms, and we will prepare the next AGR working and fee for your approval.