The industrialist of India Anil Ambani has avoided the jail by paying back the interest of Rs 5.5 billion to Swedish telecom giant Ericsson. As the four-week deadline set by the supreme court was nearing by, his elder brother Mukesh Ambani helped him by paying off debt a day before the supreme court deadline. On Feb 20, the supreme court has ordered the Reliance Communications and two of its directors to pay Ericsson its pending dues before March 19 or they will face a three-month jail if the orders were not followed.
The spokeswomen said that the Swedish Telecom giant Ericsson received Rs. 4.62 billion from RCom as unpaid dues from a deal which they signed in the year 2014. Mukesh Ambani India’s richest man who controls the oil to telecoms in Reliance Industries has offered support to his brother Anil Ambani and paid off total dues of Rs 5.5 billion ($80 million) to Ericsson.
In a statement, Anil Ambani has thanked his brother Mukesh Ambani and Sister-in-law Nita for standing by his side during the tough time and demonstrating the importance of staying true to our strong family values by extending this timely support.
Anil Ambani in a statement says that he and his family are grateful. They have moved beyond the past and are deeply touched with the gesture from his brother Mukesh Ambani. This is the second time that Mukesh Ambani has came to rescue his brother after their famous feud that dogged the Reliance Group and ended up splitting it into two between the two brothers.
In 2018 Reliance Jio Infocomm which was controlled by Mukesh Ambani, brought RCom’s wireless assets for Rs 3,000 crore in a sign that the acrimony of the past was buried. The 18-month long battle with Ericsson ended on Monday with the payment of debt amount. The company paid the dues including interest to Ericsson with its Income Tax Refunds for Rs 260 crore.
The Battle between Ericsson and RCom has started when the Swedish company moves a bankruptcy court in the year 2017 alleging that RCom has not paid dues of around Rs 1,500 crore after signing a seven-year deal in 2013.
The case then moved from the National Company Law Tribunal (NCLT) to the National Company Law Appellate Tribunal (NCLAT) where the two parties reached to a settlement amount of Rs 550 Crore with the deadline being September 30, 2018.
As the RCom has not paid the amount, Ericsson moved to Supreme Court, which gave another deadline i.e December 15th, 2019 to repay dues. But RCom has failed to pay the amount both times.
The Apex Court in February held Ambani in contempt for not paying Ericsson’s dues despite having money. As per the orders from the Supreme Court, the last date to make the payment including the penal interests was March 19th.