Supreme Court orders Ambani's RCom to pay Rs 550 crores to Ericsson by 15th December

Last Updated: Wed, Oct 24, 2018 15:07 hrs
Anil Ambani, chairman of the Reliance Anil Dhirubhai Ambani Group, attends the annual general meeting of Reliance Capital in Mumbai

Anil Ambani's Reliance Communications has been ordered to pay Rs 550 crores to Swedish telecom manufacturer and service provider Ericsson.

The top court refused to grant any extensions and asked Reliance Communication to clear part dues of Rs 550 crores latest by December 15.

The amount also includes an interest of 12% on dues that have been unpaid since September 30.

Telecom service provider Ericsson had moved the top court to restrain the company's promoters and senior executive from leaving the country or even selling its mobile business assets. They alleged that defaults of Rs 550 crores were wilful.

Meanwhile, RCom contended that the dues could be paid only in the event the department of Telecom approved a sale of spectrum.

"DoT approval is beyond our control, spectrum sale is stuck on account of DoT nod," said a company official from Reliance Communications to the court.

The RCom official also said that Ericsson's dues will be cleared in a matter of seven days from the approval from DoT.

Ericsson's lawyers however argued that the company had already received Rs 5000 crores from sale of its assets and RCom raised the "bogey of DoT nod to cause delays."

The Swedish company was quoted as saying, "RCom was taking the Supreme Court and Ericsson for a ride."

The case pertains to deal between Anil Ambani lead Reliance Communications and Ericsson in 2014. At that time, a seven-year deal was signed by Ericsson to operate and manage RCom's nationwide telecom network.

Ericsson initiated insolvency proceedings in 2018 against Anil Ambani's companies in a National Company Law Tribunal (NCLT) to recover dues of Rs. 1,150 crores. Dues have now increased to Rs. 1,600 crores.

Rcom's dues have been reported at a total of Rs 40,000 crores and the company has said that spectrum sale of existing assets would help it clear dues of most of its lenders.

Meanwhile, Anil Ambani at the latest AGM of Reliance Communications announced an exit from Telecom business and thanked elder brother Mukesh Ambani for.

Read more about that here.

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