April 01 2020
SC reserves orders on contempt plea against Anil Ambani
14 February 2019

His group firms making crores: plaintiff

The Supreme Court on Wednesday reserved orders on a contempt plea filed by Ericsson India against Reliance Communications Ltd. (RCom) chairman Anil Ambani and others for non-payment of ₹550 crore in dues.

Earlier, senior advocate Dushyant Dave, counsel for Ericsson, raised the controversial Rafale combat jets’ deal, contending that the defendants were not lacking in resources. “They have money to pay for Rafale... somebody who cannot pay ₹550 crore to us is there in every conceivable deal,” Mr. Dave submitted before a Bench of Justices Rohinton F. Nariman and Vineet Saran.

He also pointed out that Reliance Defence led by Mr. Ambani was an offset partner of Rafale maker Dassault Aviation. “If one company is sinking, other companies are making money in crores,” Mr. Dave submitted, referring to the group led by Mr. Ambani. “They live like emperors, stay in luxury hotels.” Terming the Swedish telecom equipment major’s contempt petition as “abuse”, Mr. Ambani’s lawyer, senior advocate Mukul Rohatgi, said the action was meant to “pressurise a client”.

The “out-of-the-box settlement” with brother Mukesh Ambani-led Reliance Jio was for the “benefit of all, including Ericsson,” Mr. Rohatgi contended. Reliance Jio, which had agreed to buy spectrum, towers and other wireless infrastructure of RCom, however, only paid ₹780 crore as the first transfer of money in the ₹18,100 crore deal. This had gone directly to the escrow account maintained by 46 lenders, who had used the money to provide bank guarantees to the DoT to keep RCom’s licences alive.

The counsel asserted that the undertaking given by Mr. Ambani was conditional to the success of the RCom-RJio deal, which did not materialise. On February 1, RCom said it would file for bankruptcy after failing to sell its assets to pay up debts worth about ₹45,000 crore.

Previously, RCom had offered ₹118 crore by demand drafts towards outstanding dues as a show of bona fide, which Ericsson had refused.

The court had ordered that the demand drafts be deposited with the court registrar. Ericsson had sought contempt action against Mr. Ambani, who was present in the courtroom for the second consecutive day of hearing, Reliance Telecom chairman Satish Seth and chairperson of Reliance Infratel Chhaya Virani.



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