Troubles rise for Reliance Communications after NCLAT refuse release of tax refund

The NCLAT bench was hearing the petition of RCom to release ₹260 crore received from income tax refund from the Trust and Retention Account (TRA) held with the SBI

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Troubles lay ahead for Anil Ambani-owned Reliance Communications as the National Company Law Appellate Tribunal (NCLAT) on March 15 refused to direct the State Bank of India (SBI) to release income tax refund of ₹260 crore to clear Ericsson's dues.

The bench was hearing to a petition by RCom to release ₹260 crore received from income tax refund from the Trust and Retention Account (TRA) held with the SBI. However, they declined the request by Reliance.

No direction can be given to any party to perform certain duties to ensure settlement between other parties. As the Supreme Court (SC) is seized of the matter, we are not passing any direction to refund any amount to anyone or other parties till the court passes some orders," the NCLAT bench said.

The telecom company has been asked by NCLAT as well as the Supreme Court to pay ₹550 crore to Ericsson. Till now, they have paid ₹118 crore to Ericsson. However, if RCom fails to pay the rest of the money, then chairman Anil Ambani may have to face a three-month jail term for the contempt of court order.

The apex court has directed RCom to pay Ericsson by March 19. Meanwhile, the telecom company can still approach SC for seeking the release of ₹260 crore from SBI to repay Ericsson.

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