The Supreme Court on Friday (August 21,2020) adjourned the meeting on the issue of Adjusted Gross Revenue (AGR) dues from telecom organizations to August 24, Monday. During Friday's hearing that was on 21 August the central matter of the arguments was based on the range as an asset for the telecom organizations, its dealers, and related rights. Prior to August 20, the Supreme Court expressed worry that practically the sum of the dues from telecom organizations could be cleared out under the progressing IBC process.
Here are the fundamental features from the Supreme Court hearing on the AGR installments contribution case from telecom organizations on August 24,2020:
- The Supreme Court has adjourned the AGR hearing to August 24.
- Shyam Divan, appearing for Resolution Professional of RCom, addressing the Justice Arun Mishra led bench of SC.
- Kapil Sibal to SC: Spectrum is recognized as an asset; it is the most valuable asset with telcos. Spectrum is taken as security by the lenders. If SC refuses to recognize the sale of the spectrum, banks will stop lending to telcos, will grievously hurt the telecom sector.
- Salve for R. Com COC: SC holding that the spectrum CAN'T be sold, will not help recover the AGR dues. If the spectrum sale is not allowed, it will be returned to DoT, auctioned for future use, won't help recover AGR. The issue of the sale of the spectrum should be left to NCLT.
- Salve for R. Com COC: In the NCLT, DoT is challenging the resolution plan on the ground that the spectrum can be sold. Our understanding is that the spectrum can be sold, not allowing the sale will not help anyone.
- Kapil Sibal for Airtel: Even Airtel has not received any notice from the Govt over any additional dues.Harish Salve for Jio: We have not received any notice from the govt on any additional dues claimed by the DOT.
- Official liquidator of Etisalat DB addressing the Justice Arun Mishra led bench of SC.
- Videocon RP to SC: We are not liable to pay anything beyond the CIRP process. AGR dues will be addressed as operational dues under the IBC Process. The waterfall mechanism will have to be followed as per IBC. Videocon RP concludes arguments.
- SC observes: As per trading guidelines, past dues need to be paid before the transfer of the spectrum. If you don't pay, Bharti who acquired the Videocon spectrum will have to pay. NOTE: Videocon's AGR dues pegged at Rs 1376 crore.
- Counsel for Videocon addressing the Supreme Court bench headed by Justice Arun Mishra. Videocon to SC: The payment of AGR dues will be as per the IBC.
- Justice Arun Mishra led bench assembles; Hearing begins in the AGR case.
- AGR hearing to begin shortly in Supreme Court. Justice Arun Mishra led bench likely to focus on the recovery of AGR dues from insolvent telcos. No clarity yet on staggered payment. The hearing was scheduled at 2 pm. Delayed by a few minutes, reports CNBC-TV18's Ashmit Kumar.
- Anil Ambani's spokesperson says RP (resolution professional) will examine SBI's insolvency application against Anil Ambani, submit a report to NCLT. NCLT order will have no bearing on operations of Rel Infra, Rel Power, Rel Cap.
- Anil Ambani's spokesperson says that the NCLT order is being reviewed, taking advice on filing an appropriate appeal against RP appointment. NCLT order directing RP appointment does not constitute an admission of SBI's application.
- NCLT Mumbai Order: Sec 60(2) clearly provides for proceedings to be launched Vs personal guarantors, running parallel to CIRP. Fallacious to assume that no action can be taken against guarantors until Resolution Plan is accepted. RP to be appointed, SBI to take necessary action.
- Meanwhile, the NCLT Mumbai has allowed the initiation of the bankruptcy proceedings against Anil Ambani over Rs 1,200 crore personal guarantees to SBI.