The Committee of Creditors (CoC) of Aircel has approached the Supreme Court (SC) to overrule the order of the National Company Law Appellate Tribunal (NCLAT) that restrict them from selling the spectrum before the overall dues of the company are cleared. Because of the order, Aircel might have to move towards liquidation, which will hurt all of its lenders who are trying to recover their money from the company.
To recall, the NCLAT order came back in April 2021, and it affected not only Aircel but also RCom, which is in a similar battle of paying dues to the Department of Telecommunications (DoT).
SBI and Other Creditors Approach Supreme Court to Go Against NCLAT Order
A senior State Bank of India (SBI) official told ET Telecom that the bank has moved to SC for going against the NCLAT order. As per the report, other parties involved with Aircel, including UVARCL, which has the National Law Company Tribunal’s (NCLT) permission to take over the assets of the company along with the resolution professional Deloitte, will soon move to the SC separately to complain against the NCLAT order.
For the unaware, NCLAT gave an order which said that companies would need to clear all their dues without which they cannot utilise the spectrum they hold. The only way for companies like Aircel to clear dues is to enter the Corporate Insolvency Resolution Procedure (CIRP) under the Insolvency and Bankruptcy Code (IBC). This would force Aircel to go into the liquidation process.
It is worth noting that RCom is also in a similar battle with the DoT over dues. RCom owes the government Rs 26,000 crore in adjusted gross revenue (AGR) dues, while Aircel owes Rs 12,389 crore.
DoT has asked for Rs 14,000 crore from Aircel. But since DoT is an operational creditor of the company, it won’t get what it is looking for. The operational creditors, along with DoT, have already been provided with Rs 28.50 crore, which is only 0.16% of the Rs 17,462 crore they wanted to recover.
The creditors have moved to the SC to seek the reversal of the NCLAT order. Spectrum is a big asset for the company, and it can help a ton with the resolution plans. If the NCLAT order isn’t reversed, SBI would be the one to lose out on most of the money.