RCom, RTL lenders set to move SC for clarity over spectrum sale

While the Supreme Court had asked the NCLT to decide whether spectrum could be sold as part of the resolution process under the Insolvency and Bankruptcy Code (IBC), lenders want the apex court to direct the National Company Law Appellate Tribunal (NCLAT) to look into it, two people aware of the matter said, on condition of anonymity.

“This is because the Mumbai NCLT has already approved Aircel’s resolution plan which envisaged the sale of spectrum and therefore it would not be fair to seek directions from the same tribunal," said the first person cited above.

The Supreme Court had on 1 September said that the NCLT should decide whether spectrum held by stressed telcos can be sold under IBC.

“Therefore, lenders have to first go to the SC to seek a revision that allows the appellate tribunal to decide on the issue," said the second person.

On 21 August, the department of telecommunications (DoT) had told the NCLT that spectrum assets should not be included in the resolution plan for RCom and its unit, RTL. RCom owes ₹49,054 crore to its lenders and ₹25,199 crore in spectrum usage charges and licence fee dues to DoT, according to government estimates.

UV Asset Reconstruction Co. Ltd (UV ARC) and Reliance Jio, the winning bidders for RCom’s spectrum, real estate, enterprise, tower and data centre business, have together offered more than ₹20,000 crore (on net present value basis) for these assets.

However, in another twist, the Reserve Bank of India (RBI) recently rejected UV ARC’s resolution plan for Aircel, saying the plan does not conform to the guidelines of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act.

RBI’s primary objection, Mint reported, was that instead of buying debt, the ARC was buying equity in a company.