The lenders to the crippled Reliance Communications (RCom) on Tuesday moved NCLT to appoint a new resolution professional (RP) and form a committee of creditors, the first step to begin the bankruptcy process of the Anil Ambani group company that owes close to ₹50,000 to 31 lenders led by State Bank of India (SBI).
Meanwhile, RCom through the existing resolution professional, sought 13 months exclusion in the insolvency process citing the stays it had on the process by the appellate tribunal and the Supreme Court.
The RP sought the exclusion from 30 April, 2018 to 30 May, 2019 as the initial insolvency proceedings was stayed by the National Company Law Appellate Tribunal (NCLAT) and later by the apex court.
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 the long legal and government delays for approvals.
Also, the company has not been successful to meet any of the several publicly made promises to pay back the lenders by monetising real estate and spectrum assets.
Last month company chairman Anil Ambani managed to avoid a contempt of the Supreme Court and a possible jail term after a last-minute bailout by elder brother Mukesh who extended him over ₹480 crore to pay back vendor Ericsson, which was the first operational creditor to drag it to NCLT last year.
Earlier, China Development Bank from which RCom had borrowed over $1 billion, had dragged it to the NCLT which was settled after giving a portion of its headquarters DAKC in the nearby Navi Mumbai.
On 3 May, SBI held a meeting to shortlist an RP after issuing a request for proposal in April for a new RP.
RCom's committee of creditors will have to approve a new RP with a 66% vote after the NCLT starts the insolvency process.
The Mumbai bench comprising of VP Singh and Ravikumar Duraisamy directed the existing RP to file a progress report by 30 May when it will hear the matter.
Reliance Group companies have sued HT Media Ltd, Mint’s publisher, and nine others in the Bombay high court over a 2 October 2014 front-page story that they have disputed. HT Media is contesting the case.
This story has been published from a wire agency feed without modifications to the text.