RCom Awaiting NCLAT Decision Against Insolvency, Expected to Come Tomorrow

Reliance Communications will tomorrow stand in the hearing on its plea against the NCLT’s order which pushed the telco towards insolvency after the Swedish manufacturer Ericsson filed a petition in the Tribunal. Today the telco was mentioned in the National Company Appellate Tribunal (NCLAT) seeking an urgent hearing on the issue. The Tribunal also directed that the matter is listed for hearing tomorrow. In a regulatory filing, RCom said: “The appeals filed in the NCLAT against the NCLT orders admitting RCOM, RITL and RTL to the debt resolution process and appointment of the Interim Resolution Professional, were mentioned for urgent hearing today.”

The telco further added, “The NCLAT has fixed the appeals for hearing tomorrow, May 29, 2018.”

There was also the declaration by RCom that major lenders including China Development Bank, State Bank of India and Standard Chartered Bank have also been formally impleaded to the appeal proceedings before NCLAT.

This development has happened after Reliance Communications with its subsidiaries, Reliance Telecom Limited (RTL) and Reliance Infratel Limited (RITL) approached the NCLAT in an attempt to repeal the order passed by the NCLT.

This happened after NCLT admitted Ericsson’s insolvency petition against Reliance Communications and its two subsidiaries on May 15, instead of Ericsson seeking to recover unpaid dues.

The dues which Ericsson was asking for recovery were a result of a seven-year deal which Ericsson had made in 2014 to operate and manage RCom’s nationwide telecom network. The manufacturer later alleged that RCom had defaulted on the payment.

It was in last September that the Swedish company approached NCLT’s Mumbai bench by filing a petition for seeking RCom’s liquidation in order to recover Rs 1,150 crore that the telco owed to Ericsson.