Reliance Infratel ‘fraud’ tag to go after sale: Lenders

(This story initially appeared in on Jun 10, 2021)

Mumbai: In a bid to get the decision of Anil Ambani’s Reliance Infratel again on monitor, lenders led by have mentioned that the ‘fraud’ tag on the corporate would go as soon as it’s acquired by Mukesh Ambani’s Reliance Jio. However, the prison investigations would proceed in respect of the erstwhile promoters.

Last month, Mukesh Ambani-led Reliance Jio Infocomm had moved the National Company Law Tribunal (NCLT), searching for disclosures of a forensic audit report of Reliance Infratel after some lenders labeled the mortgage as ‘fraud’. This classification occurred after the NCLT had permitted Jio’s decision plan to choose up the tower and fibre belongings of the Anil Ambani group firm for round Rs 4,400 crore on December 3, 2020.

This flip of occasions had resulted within the decision plan getting delayed. According to banking sources, it’s already established by regulation that after implementation of a decision plan below the chapter code, the fraud tag on the corporate going through chapter proceedings is eliminated and prison proceedings will apply solely towards the erstwhile promoters of Reliance Infratel.

The NCLT had in April reiterated that guidelines below the code will maintain priority over different legal guidelines and actions, akin to attachment of property by the Enforcement Directorate. The courtroom had additionally held that the ED can’t connect properties of and Power — an organization bought below the chapter course of to JSW — for frauds dedicated by the earlier administration.

Lenders have knowledgeable the courtroom that when Reliance Jio takes over by implementing the decision plan, banks would strike the identify of the corporate from the fraud or wilful defaulters’ checklist. However, this is able to not have any impression on the motion towards the erstwhile administration or promoters.

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