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Centre Moves SC Seeking Rs 2,940 Crore RCom Bank Guarantee Over Spectrum

The Supreme Court on Monday agreed to hear the Centre’s plea for Rs 2,940 crore bank guarantee from Reliance Communication arising from outstanding spectrum dues. The case was brought before a bench headed by Justice A.K. Sikri who said it would be heard tomorrow.

Seeking that the bank guarantee be furnished, Additional Solicitor General P. S. Narasimha appearing for the Centre told the court that it was looking for some kind of securement. Reliance Communication Ltd (RCom), on the other hand, through its counsel Kapil Sibal, said the company was not in a position to make the payment.

“I can’t give a bank guarantee. Banks are secured creditors. They will be in jeopardy and the deal will fall through,” Sibal said.

On 1 October, the telecom tribunal had permitted the debt laden RCom to go ahead with its spectrum sale to Reliance Jio Infocomm (Jio). The Anil Ambani-led RCom had challenged the “unjustly sought security for the alleged demands” by the telecom department with regard to spectrum usage charges.

Thereafter, RCom was given time by the apex court till 15 December to clear the pending payment of Rs 550 crore towards telecom equipment manufacturer Ericsson India Pvt. Ltd. Delayed payment was to attract an interest of 12% per annum.

The apex court’s ruling had come on a contempt plea by Ericsson for non-payment of Rs 550 crore by RCom by the 30 September deadline.

In December 2017, as a part of its debt resolution plan, the Anil Ambani-led RCom struck a Rs 25,000 crore deal with elder brother Mukesh Ambani’s Reliance Jio for the sale of its assets mortgaged with different banks, to avoid insolvency proceedings. – Live Mint

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