The Supreme Court on Tuesday gave Reliance Communications Ltd (RCom) time till 15th December to clear the pending payment of Rs 550 crore towards telecom equipment manufacturer Ericsson India Pvt. Ltd.
Delayed payment will attract an interest of 12% per annum.
A two judge bench headed by Justice Rohinton F. Nariman made it clear that this was the last time extension for RCom and that the amount must be paid on or before 15th December.
“You (Reliance) ask for a reasonable period, we will give you and after that its over”, Nariman said.
Senior advocate Kapil Sibal said: “Jio has not given us a penny. We are waiting for DoT to give us NoC for the sale of assets. The moment DoT gives us the NoC, within a week we will pay”.
This was opposed by senior advocate Dushyant Dave appearing for Ericsson who disuaded the court from accepting the DoT’s argument.
“This bogey of DoT’s approval is being raised to avoid paying money. They have already sold assets worth thousands of crore,” Dave told the court.
At the last hearing, RCom had told the court it would settle its dispute over dues with Ericsson India in 10 days.
The apex court was hearing a contempt plea by Ericsson for non-payment of Rs 550 crore by RCom by the 30th September deadline.
RCom moved the top court on 19th March, seeking a stay on the orders by the Bombay High Court and the Mumbai Bench of the National Company Law Tribunal (NCLT), barring it from selling its wireless assets to Reliance Jio without the court’s prior approval. The company was joined as a co-petitioner by State Bank of India, which approached the court on 20th March, seeking approval for the sale of RCom’s assets to Reliance Jio.
The National Company Law Appellate Tribunal (NCLAT) had, on 30th May, stayed a corporate insolvency resolution process initiated against Anil Ambani-owned RCom and two group companies, Reliance Infratel and Reliance Telecom.
The NCLAT order came after Ericsson India, which had initiated the insolvency proceedings, accepted RCom’s offer to pay Rs 550 crore by 30 September.
Ericsson had signed a seven-year deal with RCom in 2014 to operate and manage its nationwide telecom network. After alleged non-payment of dues since 2016, Ericsson moved the NCLT against RCom and group companies, Reliance Infratel and Reliance Telecom, in September 2017.
With the insolvency process being stayed, RCom can now go ahead with its Rs 18,100 crore deal with Mukesh Ambani-led Reliance Jio for the sale of its assets mortgaged with different banks to bring down debt.
Part of the deal with respect to the stay on sale of tower and fibre assets was cleared by the appellate tribunal on 29th May after Reliance Infratel’s offshore investors and minority shareholder HSBC Daisy Investments (Mauritius) Ltd decided to withdraw their objections to the sale.
A stay imposed by the Bombay High Court on the sale of the other assets—spectrum, media convergence nodes and real estate (in New Delhi, Chennai, Kolkata, Jigni and Tirupati)—was vacated by the Supreme Court on 5th April.
RCom and its subsidiaries have a total outstanding debt of around Rs 45,000 crore. – Live Mint