NCLAT bars RCom from selling any asset sans prior approval

The National Company Law Appellate Tribunal (NCLAT) had said that Reliance Communications (RCom) or any third party cannot sell, transfer or alienate any of its assets (movable and immoveable) without the appellate tribunal’s or the Supreme Court’s permission. The directive came after RCom on Monday moved the NCLAT for withdrawal of its appeal against an NCLT order, directing the firm to pay Rs. 550 crore to Ericsson, to pursue the resolution plan through the National Company Law Tribunal (NCLT) process. Accepting RCom’s application for withdrawal of the said appeal, the NCLAT directed Ericsson to file its reply in the matter by February 8 and listed the matter for hearing for February 12. NCLAT also prohibited RCom’s guarantors and any third party from invoking any guarantee, mortgage or any other instrument without the NCLAT’s or Supreme Court’s prior permission Shares fall RCom shares fell by almost 54% on Monday morning as the firm planned to file for insolvency under the IBC, being unable to sell its assets to pare debt. The company, with an outstanding debt of Rs. 42,000 crore, announced its intention to file for bankruptcy in the NCLT. In a separate development, Telecom Disputes Settlement and Appellate Tribunal upheld RCom’s petition against the Department of Telecommunications (DoT), challenging DoT’s decision to impose one-time spectrum charge on its contracted CDMA and GSM spectrum resources.

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