ET: DoT to oppose spectrum sale of bankrupt telcos

6 June 2019: The department of telecommunications (DoT) plans to oppose the sale of airwaves held by bankrupt telcos during the insolvency resolution process, a move that will make Aircel and Reliance Communications less attractive to buyers and hit their lenders.

A senior DoT official told ET that the department will take all legal steps, including moving the Supreme Court if necessary, to ensure that that the resolution professional doesn’t get the right to sell spectrum during the bankruptcy proceedings. To begin with, DoT is expected to state its position at the ongoing hearings of the Aircel bankruptcy process at the National Company Law Tribunal (NCLT).

“DoT’s view is that this spectrum belongs to the government and it does not come under the definition of property of the telco,” said this official.

The department believes that the government is the licensor of the airwaves and is the only one authorised to sell it through auctions, according to existing law. More so, since spectrum is a finite and sovereign asset, it makes the government the sole authority responsible for allocating it, the official explained.

‘Legal Opinion Being Sought’

“A legal opinion is being sought… All legal options are also being explored,” said a second official aware of the matter.

The DoT is of the view if the spectrum is sold by the resolution professional under the Insolvency and Bankruptcy Code 2016, the value will be far less than the market price of airwaves. In addition, the sale proceeds will first accrue to banks and other financial lenders, with operational creditors like the DoT way down in the priority list, in terms of getting paid.

“We’re examining what should be the way forward…whether this category of transaction can be removed from IBC,” the second official said.

One of the officials said that if NCLT, which is the dedicated insolvency court, were to give a decision on the lines that spectrum could be sold by the RP managing the bankrupt telco, the government would be “within its rights to move the Supreme Court”.

The move assumes huge significance as the result of the decision will affect the insolvency, bankruptcy and revival proceedings of defunct carriers Aircel and Reliance Communications. Without the prized airwaves, the companies would have little value, or perhaps no value at all, to potential buyers. In addition, the outcome in this issue could impact sectors such as mining as well.

UV Asset Reconstruction Company Ltd. (UVARCL), which has put in a bid with Aircel’s RP Deloitte to take over Aircel, will argue forcefully against the DoT’s view. “The spectrum is part of the other assets that will be with the company. The DoT cannot take away the spectrum,” said a person aware of the development.

“We are bound by confidentiality obligations and are unable to comment on client-specific matters,” a Deloitte spokesperson said, while UVARCL said it “can’t comment at this stage”. The NCLT will next hear the Aircel matter on June 10.

The NCLT will next hear the Aircel matter on June 10 while the next hearing on RCom is scheduled for June 21.

The NCLT appointed interim resolution professionals (IRPs) of RCom — which has a debt of Rs 46,000 crore — and two of its subsidiaries have admitted claims of about Rs 66,000 crore against the companies. Aircel, on its part, has a debt of about Rs 20,000 crore.

Mails to RBSA Advisors LLP, IRPs of RCom and its two units didn’t elicit a response till the time of going to press.

Manoj Kumar, partner at insolvency specialist firm Corporate Partners, backed DoT’s stance.

“I believe, legally, DoT is right. The spectrum is a government property and the telecom operators are just licensees. If the licensees are not able to use it or can’t pay a fee, the spectrum licence may be revoked,” Kumar said.

Kumar said that the final decision on such an issue will have wider ramifications for sectors beyond telecom, such as mining.

“Similar situation may arise in all the cases where the key asset is government licences, like mining licence. If insolvency licences are revoked, then there would be little hope of resolution and there will be huge haircuts,” he said.

The Economic Times reported

NIE: SBI seeks more time from NCLT to file reply in Reliance Infratel case

1 June 2019: Public sector lender SBI on Friday sought more time from the NCLT to file reply on Doha Bank’s plea seeking stay on a decision of the committee of creditors (CoC) of Reliance Infratel (RITL).

Doha Bank has argued that the creditors’ panel has considered the claims of lenders of parent firm Reliance Communications on the basis of corporate guarantee of RITL which would reduce its voting share in the CoC.

The bank claimed to be direct lenders and said as a syndicate of four banks, it had lent Rs 1,400 crore to RITL. Doha Bank is against considering lenders having corporate guarantee of RITL as financial creditors as this will marginalise their voting rights to 15 per cent from around 55 per cent currently.

The lenders of Reliance Infratel have invoked bank guarantees of Rs 8,000 crore issued by the company in favour of Reliance Communications. The tribunal asked State Bank of India (SBI) to file reply within seven days and Doha Bank to file a rejoinder in three days.

The advocate for Doha Bank Prateek Saksaria had said the petition should be heard before e-voting in the ongoing CoC, whose main agenda are the appointment of resolution professional, determination of voting rights among others.

According to the RComm’s website, Reliance Infratel’s lenders have claimed Rs 12,687.65 crore, of which Rs 9,665.07 crore has been admitted so far. Claims against RComm stood at Rs 49,193.46 crore and the resolution professional, RBSA Advisors LLP, has admitted Rs 47,038.79 crore. Saksaria said, as a syndicate of four banks, including Doha Bank, are direct lenders and had lent Rs 1,400 crore to RITL, the tower unit of RComm.

After listening to the argument, the National Company Law Tribunal (NCLT) bench comprising of V P Singh and Ravikumar Duraisamy said, the IRP process will continue till the order is passed and so will the CoC meeting.

However, they said, it is to be clarified that if the CoC pass any resolution in the meeting, it will depend on the outcome of this plea. The tribunal has kept the hearing on the matter on June 21. The corporate insolvency resolution process of debt ridden telecom resumed after the appellate tribunal vacated the stay on the CIRP of RCom.

In September 2017, Ericsson had filed a petition in the NCLT’s Mumbai bench seeking liquidation of the telecom operator to recover Rs 1,150 crore that RComm allegedly owes it.

This was accepted by the NCLT over RCom’s failure to pay dues to the tune of Rs 1,500 crore, however, it was later stayed by the National Company Law Appellate Tribunal (NCLAT) as both parties reached a settlement, with RComm agreeing to pay Rs 550 crore to Ericsson by September 30, 2018.

Meanwhile, RComm moved the Supreme Court, seeking an extension of the deadline to pay the amount to Ericsson because of a delay in completion of spectrum sale and other assets, to which the apex court granted it time till December 15, 2018.

After RComm had failed to pay the agreed amount, Ericsson moved the apex court wherein the court ordered Anil Ambani, Reliance Telecom Chairman Satish Seth, and Reliance Infratel Chairperson Chhaya Virani to pay Rs 453 crore within four weeks (March 18, 2019). The Swedish company has been opposed to RComm’s insolvency proceedings as it will then have to return the money it had received.

Under insolvency proceedings, dues of financial creditors are settled first and operational creditors get paid only after that. The NCLAT had observed that in case insolvency proceedings against RComm and two other companies were restarted, Ericsson might have to refund the money.

The New Indian Express reported

ET: SBI in favour of a single Resolution Professional for RCom, subsidiaries

1 June 2019: State Bank of India has made a proposal to appoint a single resolution professional to run the bankruptcy process of Reliance Communications and two of its subsidiaries, people with knowledge of the development said. Chinese lenders to the Anil Ambani-controlled telecom company have, however, objected to the proposal.

SBI made the proposal at a meeting of lenders on Thursday, arguing that it would ensure better coordination during the bankruptcy proceedings of RCom and its Reliance Infratel and Reliance Telecom arms, the people said. This, the state-run bank said, would result in speedier resolution and maximisation of the companies’ value.

Two Chinese banks are said to have opposed the proposal, citing excessive workload if one person were to act as the resolution professional for all three. The National Company Law Tribunal had in May last year approved the appointment of three people as the interim resolution professionals (IRPs) — Pardeep Sethi, Mitali Shah and Manish Kaneria — to manage the insolvency process of RCom and the subsidiaries, though all of them represent a single firm, RBSA Advisors. An IRP can be confirmed as the resolution professional once the committee of creditors convenes and gives its consent.

The lenders also have the right to replace the IRP with a new person. SBI has also proposed to replace RBSA with Deloitte. One person close to the development said the Chinese lenders were likely to object to this proposal as well, though this was not corroborated.

“It is a policy of the bank not to comment upon individual accounts and its treatment”, an SBI spokesperson said in response to ET’s queries. China Development Bank, Export Import Bank of China and Industrial and Commercial Bank of China are among lenders to RCom as well as Reliance Telecom. China Development Bank’s exposure is around Rs 11,000 crore.

ET could not ascertain which of the three had opposed the proposal. “Most of the claims of the Chinese lenders are at the parent company level and they would not like the bankruptcy processes to be run as a single process as this would reduce their voting strength when deciding on common resolution plans for all three companies,” a banker said.

The lenders have decided to subject the proposed appointment of Deloitte to an electronic vote, ET reported on Friday. Several Indian banks are said to be backing the appointment of Deloitte.

The Economic Times reported

ET: IRPs admit Rs 66,000 crore of claims against RCom, arms

31 May 2019: The bankruptcy court appointed interim resolution professionals (IRPs) of Reliance Communications (RCom) and two of its subsidiaries have admitted claims of Rs 66,000 crore, more than three fourths of those filed, against the companies, people in the know said.

Bankruptcy proceedings of RCom, Reliance Telecom and Reliance Infratel formally kicked off on Thursday, with a meeting of the banks that have lent money to them to lay out the timelines for the process and to appoint new resolution professionals.

Banks and other financial institutions have filed total claims of around Rs 85,000 crore against the Anil Ambani-promoted telecom company and its units, the people said.

The lenders do not own any equity shares in RCom, though an initial plan had contemplated them converting part of their debt into a controlling stake. The promoters own 22% of the company as per latest stock exchange filings. The rest is held by public shareholders.

While claims worth Rs 49,000 crore have been filed against RCom that houses spectrum and some parts of the now-defunct mobile telephony business, the second-largest share of claims at Rs 24,000 crore was against Reliance Telecom, which held the GSM operations. Banks have filed claims worth Rs 12,000 crore against Reliance Infratel, the company that houses the telecom tower business of the group.

A large number of claims are still under verification and almost 90% of those against the parent company have been admitted “provisionally”, a person in the know said, implying that those were still subject to legal challenges by the IRPs if not found to be accurate.

Representatives of 15 banks met to discuss the way forward for the bankruptcy process where IRPs from advisory firm RBSA briefed the creditors on the claim processing status.

RBSA did not respond to emailed queries from ET till press time Thursday.

RBSA’s Pardeep Sethi is the IRP for RCom, while its Manish Kaneria and Mitali Shah are managing the bankruptcy proceedings for Reliance Infratel and Reliance Telecom, respectively.

State Bank of India, which has the largest exposure to RCom, has proposed to replace RBSA with Deloitte as the resolution professional, ET had reported in its edition on May 7.

The lenders decided to subject the proposal on Deloitte to an electronic vote, the results of which are likely to be disclosed early next week.

“It is a policy of the bank not to comment upon individual accounts and its treatment,” an SBI spokesperson said in response to ET’s queries.

RCom has had to go down the bankruptcy route after several failed attempts at restructuring the company’s debt and selling assets such as its telecom towers and spectrum.

The company announced through a stock exchange notification on February 4 that it would subject itself to insolvency proceedings at the National Company Law Tribunal (NCLT), as it was unable to pay its debt.

Swedish telecom equipment maker Ericsson had first dragged RCom to NCLT in May last year, on the grounds that the company had not paid Rs 550 crore of dues for equipment supplied to it. RCom initially resisted the insolvency proceedings, but was forced to pay under directions of the Supreme Court.

RCom stopped wireless telephony services to customers in late 2017 and said it would only focus on B2B offerings to reduce costs.

The Economic Times reported

BS: Doha Bank moves law tribunal, seeks stay on decisions of RCom lenders

30 May 2019: In a surprise intervention in the Reliance Communications (RCom) insolvency matter, Doha Bank, which is one of the financial creditors to RCom’s subsidiary Reliance Infratel, has moved the National Company Law Tribunal (NCLT) seeking a stay on the decisions of the meeting of the committee of creditors (CoC) held on Thursday.

Doha Bank has alleged that the corporate bank guarantees given by Reliance Infratel for RCom have been invoked by the banks and this, in turn, has increased Reliance Infratel’s debt significantly.

The invoking of corporate guarantees by banks has resulted in a significant reduction in the voting rights of a syndicate of four banks, including Doha Bank, which together had an exposure of around Rs 1,400 crore in Reliance Infratel. The counsel, appearing on behalf of Doha Bank, said that the four banks earlier had a 55 per cent voting right in the Reliance Infratel CoC. But now, with banks invoking the corporate guarantees, and interim resolution professional accepting the claims, their voting rights have been reduced to 15 per cent. 

Doha Bank also said that the interim resolution professional had admitted the claims of the banks that have invoked such bank guarantees without informing the four syndicate banks. This, it said, marginalises them in the CoC. The matter will be next heard on May 31. Separately, the interim resolution professional filed the progress report on RCom’s corporate insolvency resolution process (CIRP) to the tribunal. In the last hearing, the tribunal had asked the interim resolution professional to submit the progress report of the CIRP and had granted exclusion of 357 days spent in litigation from the CIRP process. 

The CoC meet on Wednesday was supposed to review the claims admitted and appoint a resolution professional. Lenders voted in favour of appointing Deloitte as the resolution professional. RBSA Advisors was the interim resolution professional. 

The CIRP of the debt-ridden telco resumed after the National Company Law Appellate Tribunal (NCLAT) vacated the stay on the CIRP of RCom. 

Operational creditor Ericsson, in September 2017, had originally filed for insolvency proceedings against RCom. This was accepted by the NCLT over RCom’s failure to pay dues to the tune of Rs 1,500 crore. However, insolvency was later stayed by the NCLAT as both parties reached a settlement, with RCom agreeing to pay Rs 550 crore. Meanwhile, RCom moved the Supreme Court, seeking an extension of the deadline to pay the amount to Ericsson because of a delay in completion of spectrum sale and other assets, to which the apex court granted it time till December 15, 2018. After RCom failed to pay, Ericsson moved the SC wherein the court ordered Anil Ambani, Reliance Telecom Chairman Satish Seth, and Reliance Infratel Chairperson Chhaya Virani to pay Rs 453 crore by March 18, or face a jail term of three months. Anil Ambani later paid the amount.

Ericsson has been opposed to RCom’s move of undergoing insolvency proceedings. Under proceedings, dues of financial creditors are settled first and then operational creditors get paid. The NCLAT observed in case proceedings against RCom and two other firms were restarted, Ericsson might have to refund the money.

The Business Standard reported

BQ: Will RCom Go The Aircel Way? No, Say Bankers

30 May 2019: Earlier this month, lenders to insolvent telecom firm Aircel Ltd. agreed to take a 99 percent haircut on the Rs 19,800 crore in loans owed by the firm to banks. They took home a meagre Rs 150 crore shelled out by an asset reconstruction company.

Aircel’s fate, which symbolises the troubles that India’s telecom industry has gone through over a turbulent decade, led to concerns that banks would need to take steep haircuts in the resolution process of other stressed telecom firms. Most notably— Reliance Communications Ltd., which is also being resolved under the Insolvency and Bankruptcy Code.

Lenders, however, say that the extent of losses seen in Aircel are a one-off and will not be repeated with RCom. Banks are confident of reasonably high recoveries from RCom over the next few months, said three senior bankers on condition of anonymity. These bankers, however, are unable to put a number to the expected recoveries given that the RCom insolvency process is at an early stage.

According to these bankers, RCom has reasonably strong assets and could attract bidders including Mukesh Ambani’s Reliance Jio Infocomm Ltd.

RCom had debt of over Rs 36,000 crore as on March 2018. This is likely to have gone up to over Rs 40,000 crore now, the three lenders quoted earlier said. Banks involved in the RCom insolvency include State Bank of India, Bank of Baroda, Yes Bank Ltd., IndusInd Bank Ltd., China Development Bank, Industrial & Commercial Bank of China, and 20 other lenders.

Assets With Realisable Value

RCom’s optical fibre, tower, media convergence nodes and wireless spectrum have high realisable value, according to the bankers quoted above. The company also owns real estate assets across Mumbai, Delhi, Chennai and Kolkata, which can help in improving recoveries.

According to the company’s annual report for 2017-18, it has:

  • Over 122 MHz of 4G spectrum.
  • 43,000 tower assets.
  • 2,80,000 km of optical fibre assets in India, U.S., Europe, Middle East and Asia Pacific region.

The first of the three bankers quoted earlier said that the consortium of lenders is confident that RCom will attract many bidders under the IBC process, since chances of challenging a decision under the code would be difficult. The successful bidder would end up owning the company’s assets without any attached liabilities, since all debt-related issues would be resolved under the IBC, this banker said.

The second banker quoted earlier said that lenders are confident of recovering a “reasonable” portion of their debt exposure, provided there are no major delays in resolving the account. In resolution of large insolvency accounts like Bhushan Power and Steel Ltd., Alok Industries Ltd. and Essar Steel Ltd., banks have faced considerable challenges due to judicial delays, the second banker added.

The BloombergQuint reported

ET: RCom panel of creditors to meet on May 30

29 May 2019: Reliance Communications’ (RCom) Committee of Creditors (CoC) will hold a meeting on Thursday, said the Anil Ambani owned telco.

“Pursuant to Regulation 30 of SESI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR) and in accordance with the requirements of sub-clause 16(g) of Clause A of Part A of Schedule III of LODR, we wish to inform you that a meeting of Committee of Creditors will be held on 30th May, 2019,” the operator said in a regulatory statement .

The CoC will be viewing the report submitted by the interim resolution professional (IRP) on claims of dues filed against RCom. The meeting may also see a new IRP getting appointed . ET had earlier reported that SBI is keen to propose Deloitte as the resolution professional for RCom’s debt resolution.

So far the work of an IRP was being done by RBSA Advisors LLP. It had to oversee the insolvency process for RCom and its two units . It will also submit a progress report on the Corporate Insolvency Resolution Process (CIRP) on May 30 to the dedicated bankruptcy court as well.

The telco which renewed its bankruptcy proceedings after staving it off for about a year, may become one of the biggest insolvency cases in India Inc. ET had earlier reported that lenders to RCom are expected to claim dues of up to Rs 90,000 crore, almost double the Rs 46,000 crore debt that the telco has in its books, making it among the highest demanded from companies that have gone for insolvency.

The Economic Times reported

ET: RCom posts a consolidated loss of Rs 7,964 crore

27 May 2019: Reliance Communications (RCom) widened its loss to Rs 7,963 crore for the January to March quarter when compared to the previous quarter where it posted a loss of Rs 340 crore . The Anil Ambani owned telecom operator under the reins of interim resolution professional is unsure if it can continue under the burden of losses and liabilities.

“…since the Company continues to incur loss, current liabilities exceed current assets and Company has defaulted in repayment of borrowings, payment of regulatory and statutory dues, these events indicate that material uncertainty exists that may cast significant doubt on Company’s ability to continue as a going concern,” said the company in a regulatory filing on Monday evening.

The telco had posted a loss of Rs 19827 crore during the same period last year.

RCom which has seen its spectrum trading alliance with Reliance Jio get called off posted a total income of Rs 1089 crore compared to Rs 976 crore when compared on a like to like basis.

The telco has also highlighted its concerns over its subsidiary-GCX Limited and said its value has been eroded. . “In GCX Limited, an overseas subsidiary of the Company, pursuant to 7% Senior Secondary Notes …amounting to $350 million falling due for repayment in the month of August 2019, the current liabilities exceed current assets by $331 million,” said the bankrupt telco in its filing. “This indicates the existence of material uncertainty relating to Going Concern of GCX Limited and its two material subsidiaries which have guaranteed the Notes. In three other overseas subsidiaries entities also, it indicates the existence of material uncertainty as networth has been eroded,” it added.

The telco which renewed its bankruptcy proceedings after staving it off for about a year, may become one of the biggest insolvency cases in India Inc. ET had earlier reported that lenders to RCom are expected to claim dues of up to Rs 90,000 crore, almost double the Rs 46,000 crore debt that the telco has in its books, making it among the highest demanded from companies that have gone for insolvency.

The company and some of its subsidiaries have not provided Interest of Rs 1,183 crore and Rs 4,389 crore for the quarter and year: ended March 31, 2019 respectively and foreign exchange variation aggregating to Rs 303 crore gain and Rs 984 crore loss for the quarter and year ended March 31, 2019 respectively. “Had the Company provided Interest and foreign exchange variation, the Loss would have been higher by Rs 880 crore and Rs 5,373 crore for the quarter and year ended March 31, 2019 respectively,” said the telco. The IRPs appointed for Rcom and its two units will submit a progress report on the Corporate Insolvency Resolution Process (CIRP) by May 30 to the dedicated bankruptcy court.

The Economic Times reported

FE: Why Ericsson may be asked to return Rs 580 crore to RCom; all that happened so far, and what’s next

17 April 2019: Anil Ambani’s Reliance Communications, which recently had to pay Ericsson dues worth Rs 580 crore, saving its chairman from going to jail, may get the money back if it moves to insolvency proceedings, the NCLAT (National Company Law Appellate Tribunal) had said earlier last week. Since financial creditors get preference over operational creditors under the Insolvency and Bankruptcy Code of 2016, and Ericsson being an operational creditor, it will be expected to return the money it got in dues.

This is because the insolvency proceeding that Ericsson had initiated against RCom was put on stay by the tribunal, and the settlement between the two happened outside the insolvency provisions when the stay was in effect, said Daizy Chawla, a lawyer. Now, if the stay were to be vacated to allow the insolvency proceedings to resume, the settlement money paid in the interim would have to be returned, Daizy Chawla, Senior Partner, Singh and Associates, told Financial Express Online.

The NCLAT is expected to hear RCom’s application for vacating the stay on 30 April 2019.

What next for Ericsson?

When Mumbai NCLT had asked for insolvency proceedings against RCom, Ericsson should have gone ahead with it, Daizy Chawla told Financial Express Online. “Justice Mukhopdhyay agreed for RCom’s proposal of settlement, which was never in the provision,” she said. Now that RCom seems to have no other option, it wants to go ahead with insolvency proceedings, she added.

On the other hand, there was no application for withdrawal of insolvency petition. In RCom’s case, there is no Committee of Creditors formed yet, hence there is nobody to authorise the withdrawal. “Even if there was a committee, Ericsson would not have got the payment before financial creditors, nobody would have accepted that,” Daizy Chawla said citing the provisions of IBC.

Daizy Chawla’s firm represents one of the other operational creditors with dues pending from RCom.

Now, Ericsson needs to file an application for withdrawal of insolvency petition with NCLT. Meanwhile, RCom would be looking for the court to vacate the stay on the insolvency proceedings. Much would depend on whether the NCLAT allows RCom’s application for withdrawal of stay on insolvency, or Ericsson’s application for withdrawal of the proceedings. Daizy Chawla says that there can’t be a decision on withdrawal of the insolvency proceedings before the Committee of Creditors (CoC) is formed.

Meanwhile, Ericsson refused to comment on the reports that it may have to return Rs 580 crore in dues that it recently recovered from Reliance Communications, should the insolvency proceedings on the Anil Ambani-led company resume. When asked what would be Ericsson’s next step regarding the RCom case, Ericsson India head Nitin Bansal refused to comment stating that the matter is sub judice.

Ericsson-RCom case: Soured relations

RCom and Ericsson had begun their business transactions in 2013 to provide services for RCom’s networks. When RCom failed to pay Ericsson on time in 2016 and after several months of waiting and assurances, Ericsson was the first creditor to move NCLT in September 2017. NCLT allowed the initiation of insolvency proceedings for RCom, which was put on stay, with RCom promising to pay Ericsson about Rs 550 crore as settlement fees to avoid insolvency.

On 19 March 2019, RCom paid around Rs 580 crore to evade its chairman from going to jail after the matter had escalated to the Supreme Court.

The Financial Express reported

BS: NCLAT seeks Anil Ambani’s response in contempt plea moved by HSBC Daisy

17 April 2019: HSBC Daisy had moved the NCLAT alleging that Anil Ambani’s companies Reliance Infratel, Reliance Communications Infrastructure and RCom have breached a consent decree by not paying the Rs 230 crore settlement amount within 180 days of June 29, 2018 when the agreement was taken on record by the appellate tribunal.

Minority investors of Reliance Infratel had moved NCLAT alleging oppression and mismanagement after the company had allegedly not taken their consent for the selling the tower and fiber assets. They had moved the NCLAT in an attempt to thwart the then sale to Reliance Jio Infocomm, which had then forced Reliance Infratel to settle the issue with them.

Following the agreement, both the parties had submitted to the NCLAT their final consent terms after which the appellate tribunal had allowed both parties to withdraw their appeals. The said agreement amount, however, was never paid, HSBC Daisy has alleged.

This is the second such contempt petition moved against Ambani and his companies. Earlier on February 20, The Supreme Court had held RCom Chairman Ambani and two of his top executives guilty of contempt of court for wilfully failing to pay the dues to telecom equipment maker Ericsson.

The court had also directed Ambani, Reliance Telecom Chairman Satish Seth, and Reliance Infratel Chairperson Chhaya Virani to pay Rs 453 crore within four weeks or face a jail term of three months. It also slapped a fine of Rs 1 crore each for their “cavalier attitude” towards the court’s orders.

Ericsson India had in September 2017 moved insolvency petitions against RCom, Reliance Telecom, and Reliance Infratel at the Mumbai Bench of the National Company Law Tribunal (NCLT) for failing to pay their dues amounting to nearly Rs 1,500 crore. The petition was admitted by the NCLT in May 2018, following which the three Reliance group companies approached the NCLAT.

It was in the NCLAT that Ericsson India and the three Reliance companies had come to a settlement that the latter would pay Rs 550 crore within 120 days that is by September 30, 2018. The companies had failed to do so, following which the contempt petition had been moved by Ericsson India.

The Business Standard reported