CAG Flags ₹1,757 Crore Revenue Loss Due to BSNL’s Lapses in Billing Reliance Jio

The Comptroller and Auditor General of India (CAG) has flagged a major financial error by Bharat Sanchar Nigam Limited (BSNL), a state-owned telecom firm. For ten years, BSNL failed to charge Reliance Jio Infocomm Ltd (RJIL) for using its passive infrastructure, leading to a substantial loss of ₹1,757.76 crore to the government's revenue between May 2014 and March 2024, as stated in a CAG audit report published on Tuesday, according to PTI.

BSNL Failed to Enforce Agreement with Jio

The CAG report highlights that BSNL did not implement its Master Service Agreement (MSA) with Reliance Jio, permitting the company to utilize extra technology on BSNL's shared infrastructure without appropriate billing. This oversight has resulted in a significant drop in revenue.

"BSNL did not enforce the Master Service Agreement (MSA) with Reliance Jio Infocomm Ltd (RJIL) and did not bill for the extra technology used on BSNL's shared infrastructure, causing a loss of ₹1,757.76 crore along with penal interest during the period from May 2014 to March 2024 to the government," the CAG report noted.

Short Billing and Additional Revenue Loss

The audit also mentioned that BSNL underbilled infrastructure-sharing fees, leading to an extra revenue shortfall of ₹29 crore, including GST. The CAG indicated that BSNL did not comply with the MSA's terms and conditions and failed to apply the escalation clause, which further diminished its earnings from sharing infrastructure with RJIL.

Also, BSNL incurred a separate loss of ₹38.36 crore due to its failure to deduct the license fee from payments made to Telecom Infrastructure Providers (TIPs), adding to the financial mismanagement.

Another Setback for Reliance Jio

This is not the first time a government agency has raised concerns involving Reliance Jio. The telecom company was previously mentioned in a tax dispute linked to Samsung over the supply of 4G telecom equipment.