aircel: Supreme Court says NCLAT to decide on spectrum sale of bankrupt Aircel

Mumbai: The Supreme Court (SC) on Friday said that the appellate tribunal will take a call if spectrum of bankrupt telco Aircel can be sold while statutory dues remain. The ruling will be critical for the bankrupty proceedings of Aircel and Reliance Communications (RCom) who are in the throes of exiting their insolvencies.

A two-member panel headed by S. Abdul Nazeer said National Company Law Appellate Tribunal (NCLAT) will take a decision on spectrum sale of Aircel. The apex court modified the September 1 order which had directed the dedicated bankruptcy court to decide on the issue.

UV Asset Reconstruction company (UVARCL) is expected to pick up key assets, including spectrum, of Aircel and Reliance Communications (RCom), under the insolvency process. Although the National Company Law Tribunal had earlier ruled that Aircel’s spectrum can be transferred to UVARCL, the matter of whether spectrum of bankrupt companies can be transferred without the payment of adjusted gross revenue (AGR) dues came up in the top court.

The Department of Telecommunications (DoT) had highlighted in court that bankrupt telcos have not paid adjusted gross revenue (AGR) dues of around Rs 40,000 crore. RCom owes almost Rs 26,000 crore, Aircel about Rs 14,000 crore and Videocon Rs 1,400 crore.

The government in various appellate and insolvency courts has said that spectrum is a national asset that cannot be transferred to a third party, unless statutory dues were paid and after approvals from the DoT.

The resolution professionals and the lenders of these ailing telcos had argued that spectrum was a precious natural resource which cannot be kept idle and that they were well within their right to reassign these rights to recover the dues of the corporate debtors.

The insolvent telcos had said that lenders including public sector banks will be hugely impacted if airwaves are not allowed to be transferred. Spectrum is the security against which banks give loans.

Meanwhile UVARCL’s plans have hit another hurdle with the Reserve Bank of India (RBI) refusing to give its nod to the resolution plan.

Source link

Leave a Reply

%d bloggers like this: