The National Company Law Appellate Tribunal (NCLAT) on Wednesday reserved its judgement on a petition by Reliance Communications (RCom) which appealed tribunal seeking the release of ₹259.22 crore income tax refunds using which it can clear its ₹550 crore dues to Ericsson.
The lenders group represented by senior counsel Neeraj Kishan Kaul opposed the appeal made by he Reliance on the ground that it would lead to outgo of public money for settling payment of a private party.
NCLAT bench headed by Chairperson S J Mukhopadhaya, after hearing both the sides reserved his order and said that both the parties should see the ongoing case as resolution process rather than a law suit. Bench further added that the aim of the resolution should be to save the company so that creditors get the maximum from assets.
The bench was hearing a petition filed by RCom seeking the release of about ₹259.22 crore received as income tax refund, from the Trust and Retention Account (TRA) currently held by State Bank of India (SBI). As all the receivable of the telecom are deposited under TRA and are under the control of the bank.
The senior counsel Kapil Sibal appearing on the behalf of RCom appealed for the release of these funds so that the telecom can use the money to repay its debt to Ericsson.
He also said earlier RCom was seeking to repay Ericsson though the capital it was supposed to get from deal with Mukesh Ambani‘s Jio but the deal failed as Jio was asked to take responsibility of all its (RCom) past dues which Relaince Jio didn’t. Hence the deal couldn’t take place. So now RCom is seeking the release of funds to repay its debt.