NCLAT stays DoT showcause notice to RCom after default of dues

The National Company Law Appellate Tribunal (NCLAT) has stayed a show cause notice issued by the telecom department to Reliance Communications (RCom), asking why its license and spectrum for the Mumbai circle should not be withdrawn for defaulting on Rs21 crore spectrum payment.

The appellate tribunal Tuesday also stayed Department of Telecommunications’ (DoT) show cause notice on why they should not invoke bank guarantees, regarding the spectrum dues. The case will now be heard on April 8.

RCom shares were down 4.9% at Rs4.81 on the BSE in late trade on Tuesday.


The appellate tribunal’s decision will come as a breather to the telco under a debt of Rs 46,000 crore.

The appellate tribunal’s decision comes on the back of a legal spat between RCom and DoT. The operator had missed a March 13 spectrum payment deadline included a 10-day grace period over spectrum dues worth Rs 21 crore.

According to sources, the telco had even responded to DoT saying that it was under a payment moratorium from an earlier appellate order and therefore its license cannot be revoked. RCom has two other installments - of Rs 281 crore and Rs 492 crore - that will need to be paid in April.