Anil Ambani’s RCom’s Bankruptcy Begins, Next Hearing on May 30

The National Company Law Tribunal Thursday allowed Reliance Communications (RCom) to exclude the 357 days spent in litigation and admitted it for insolvency. With this, RCom, which owes over Rs 50,000 crore to banks, has become the first Anil Ambani group company to be officially declared bankrupt after the NCLT Thursday superseded its board and appointed a new resolution professional to run it and also allow the SBI-led consortium of 31 banks to form a committee of creditors. At the last hearing, RCom, through the existing resolution professional, had sought 357 days (from May 30, 2018, to April 30, 2019) exclusion in the insolvency process citing the stays it had on the process by the appellate tribunal and the Supreme Court.

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The RP sought the exclusion from May 30, 2018, to April 30, 2019, as the initial insolvency proceedings were stayed by the National Company Law Appellate Tribunal (NCLAT) and later by the apex court.

A bench comprising VP Singh and R Duraisamy said the matter should proceed in a manner of law and in view of the guidelines, the tribunal grants the exclusion of time for Reliance Infratel and Reliance Telecom along with RCom.

RCom was in trouble for years forcing it to discontinue operations two years ago. Its effort to stave off bankruptcy by selling spectrum to Reliance Jio got scuttled after legal and government delays for approvals. But it could not meet any of the several publicly made promises to pay back the lenders by monetising real estate and spectrum assets.