The Supreme Court (SC) on August 10 adjourned the hearing on telecom companies under insolvency to August 14, while observing that the government must come prepared with a plan for recovery of dues from the telcos under insolvency, CNBC-TV18 has reported.
A Supreme Court bench comprising of Justices Arun Mishra, S Abdul Nazeer and MR Shah heard the case. However, there is still no clarity on the question of time period to be given to telcos for repayment of their respective AGR dues. While Bharti Airtel and Vodafone Idea had sought 15 years' time for repayment of dues, the government had suggested a time-frame of 20 years.
As Justice Arun Mishra is set to retire on September 3, an order on the staggered repayment time frame is likely before that.
The SC had on July 20 reserved its order on permitting telecom companies to make staggered payments over 15 years.SC observations:
>> Justice Arun Mishra said "We want to go into cause of initiation of insolvency for telcos under IBC. We want an understanding of their outstanding liabilities, urgency in pushing for insolvency."
>> Justice Mishra: "If RCom had settled the payment dispute with Ericsson, why was the CIRP process allowed to proceed?"
>> Justice Mishra "SC orders binding on all courts, how can IBC proceedings be revived by NCLAT despite payment by RCom to Ericsson?"
>> How can it be decided for the resolution plan proceeds to be paid only to banks, and nothing to DoT for AGR?
>> What is the government's stance? It seems the govt will get nothing from the IBC process. What is the plan to recover Rs 31,000 crore from R.Comm?
>> Government must come prepared with a plan for recovery of dues from telcos under insolvency.
Solicitor General Tushar Mehta to SC:
>> Amount recoverable from Reliance Communications (RComm) is Rs 31,000 crore.
Senior Advocate Shyam Divan, RCom's resolution professional, to SC:
>> Ericsson's claim was Rs 1,677 crore. Have submitted details as sought by the SC. Insolvency began on account of claims claims made by operational creditor Ericsson, China Development Bank.
>> After banks failed to sell assets of RCom, the telco and lenders agreed for CIRP process to proceed.
>> Resolution plan pending before NCLT, COC has given 100 percent approval. RCom owes Rs 49,054 crore to banks. RCom's primary asset is the spectrum, it can be sold or monetised under the IBC to realise value for banks.
Senior Advocate Ravi Kadan appearing for Aircel to SC:
>> Resolution plan has been approved by Committee of Creditors (CoC) and the NCLT. AGR dues are of Rs 12,389cr. After the takeover by the resolution applicant, assets can be sold to raise money. Spectrum is transferrable, can be sold and bought. No money is going to operational creditors, in compliance with the IBC. Insolvency process was initiated by the company itself in February 2018.
Here's a quick recap of what happened at the previous hearing:
The top court had in October 2019 upheld the expanded definition of AGR set by Department of Telecommunications (DoT).
>> Vodafone Idea has to pay a balance of Rs 50,399 crore, while Bharti Airtel's outstanding amount is Rs 25,976 crore, said Solicitor General Tushar Mehta said on July 20.
>> Both the telecom majors, which owe the maximum amounts, had on July 20 revised their demand from 20 years to 15 years for the staggered payments after Supreme Court's stringent stance on payment period.
>> The SC is expected to stick to its observation that self-assessment of AGR-related dues by telecom companies is not allowed, and will uphold the DoT's estimates.
>> The SC had objected to any re-assessment or re-calculation of the outstanding amounts, and is unlikely to provide any relaxation in this regard on August 10.
>> The SC might also give more clarity on whether spectrum as a security against AGR-related outstanding payments. "The spectrum itself acts as a security for ensuring payment of AGR dues," Solicitor General Tushar Mehta said on July 20.
>> Reliance Communications, Videocon and Aircel were asked to submit all records and details of insolvency within seven days, after the SC had wondered if the IBC is being misused by the companies.
No comments:
Post a Comment