RCom seeks Supreme Court reversal of spectrum exclusion ruling, citing lender harm

Resolution professional Anish Nanvaty has approached the Supreme Court with a curative petition to overturn the February 13 decision that excluded spectrum assets from Insolvency and Bankruptcy Code proceedings. The filing argues that the Department of Telecommunications invoked bank guarantees and terminated spectrum allocated to Reliance Communications and its subsidiary Reliance Telecom Limited, stripping banks of the collateral for loans amounting to thousands of crores.

It warns that creating a sector-specific exception without basis in the IBC could set a precedent affecting mining leases, oil and gas licences, infrastructure concessions and hydropower rights. The petition also highlights that the court’s ruling ignored Section 14(1) of the IBC, which protects licences from termination during the moratorium if dues are paid—a condition RCom satisfied. Additionally, it points out that the DoT’s claim of Rs 31,276 crore was treated as a de facto super-priority, contrary to the 2019 Swiss Ribbons judgment upholding the IBC’s constitutional validity. Earlier, the Supreme Court had ruled that spectrum shown as an asset in telecom firms’ books could not be part of insolvency resolutions for Aircel and RCom, a decision that experts said would hinder banks’ recovery of dues.