Airtel terminates call centre services from Karvy for alleged breach of rules, pact

NEW DELHI: Telecom company Bharti Airtel has terminated the call center services from Karvy Data Management Services due to alleged violation of GST law and terms of agreement.
".......in exercise of its rights under Article 13 of the Call Center Master Services Agreement dated July 01, 2017 and all other enabling rights, Airtel hereby terminate the Agreements with immediate effect," the company said in an email to V Mahesh, Managing Director, Karvy Digikonnect Limited dated May 29.

The development follows several notices sent by Airtel, the latest being May 21, demanding Karvy to rectify tax defaults and submit documentary proof of compliance within seven days of issuing the notice, to which Karvy did not respond. ET has seen a copy of the emails.

The telco which avails Karvy's call centre services via its BPO in Tiruchirappalli, Tamil Nadu, alleged that the company has "failed to deposit the taxes with the Government as per law, including the taxes collected from Airtel, which divests Airtel of its right to claim the Input Tax Credit in respect thereof."

Karvy has also allegedly misled Airtel by sharing false information by claiming that it had taken corrective action by uploading invoices and rectification of GST return, whereas, no such information was available on the GSTN portal, Airtel said.

Airtel declined to comment to ET's query whereas Karvy did not respond till the time of filing of this story.

Airtel also said that Karvy it was only upon Airtel’s intervention by making certain advance payments for the purposes of payment of wages that the due wages were paid by Karvy to its employees for the months of March and April 2020.

Karvy has also caused financial losses to Airtel as well as loss of reputation and goodwill, Airtel said.