The Supreme Court on Tuesday gave debt-ridden Reliance Communications time till December 15 to clear the pending dues of Rs 550 crore to Swedish telecom equipment manufacturer Ericsson India.
A bench led by Justice Rohinton Nariman, while granting more time to clear the dues as sought by the Anil Ambani firm, said that this is the last opportunity being giving to the Indian company. RCom had earlier undertaken before the apex court that it would clear the dues of its operational creditor by September 30.
“You (RCom) ask for a reasonable period, we will give you and after that it’s over,” Justice Nariman said, adding that the delayed payment will attract an interest of 12 per cent per annum and will be paid from the due date of September 30. It told Ericsson that contempt proceedings can be revived against RCom if payments were not made by December 15.
The order came on an application filed by RCom wanting more time and also on a petition by Ericsson India seeking to initiate contempt proceedings against RCom promoter Anil Ambani and others for failure to comply with the apex court’s August order.
Senior counsel Kapil Sibal, appearing for RCom, told the apex court that the company had not been able to sell its 800 MHz spectrum as DoT is yet to give no objection certificate (NoC) to the sale of mobile business assets to Mukesh Ambani-controlled Reliance Jio. “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,” he said.
Senior counsel Dushyant Dave, appearing for Ericsson, argued that the Ambani firm had on May 30 settled the debt of Rs 1,150 crore for Rs 550 crore, which was to be paid within 120 days i.e., by September 30. He said the settlement was not conditional to RCom selling it assets. He argued that RCom has already sold assets and the sale proceeds have deliberately been allowed to go directly to the lenders.
“This bogey of DoT’s nod is being raised to avoid paying money. They have already sold assets worth thousands of crore,” he added. However, Sibal told the court that “Jio has not given us a penny” and all the sale proceeds have gone to banks. The NCLT had on May 15 admitted the insolvency petition file by Ericsson in lieu of recovering pending dues of Rs 1,150 crore. However, RCom amicably settled the dispute with the Swedish company by offering Rs 550 crore before the tribunal in May. Ericsson had signed a 7-year deal in 2014 to operate and manage RCom’s nationwide telecom network.
After RCom failed to pay for its supplies procured from Ericsson, the later initiated insolvency proceedings against the Anil Ambani companies before NCLT to recover the money. —FE