The National Company Law Appellate Tribunal (NCLAT) has dismissed an appeal filed by Reliance Realty, a step-down subsidiary of debt-ridden Reliance Communications, seeking recovery of rentals and assets from Independent TV, which is undergoing liquidation, as per a report by PTI.
A two-member NCLAT bench upheld the earlier order passed by the Mumbai bench of the National Company Law Tribunal (NCLT), which had rejected Reliance Realty’s plea. The tribunal said the liquidation process of Independent TV (formerly known as Reliance Big TV) should continue “in a time-bound manner and in the shortest possible time.”
The bench also noted that the process should not be “disrupted and derailed by the Appellant (Reliance Realty) who for no cogent reasons had never agitated the issue of ownership of assets lying in the leased premises.”
“We do not find any infirmity in the impugned order allowing the Liquidator to remove all moveable assets of the Corporate Debtor lying at the leased premises and in restraining the Appellant from obstructing the Liquidator and successful bidder from accessing these moveable assets,” the NCLAT said.
Earlier development: ED attaches Rs 4,462 crore worth of land of Anil Ambani Group
This development comes close on the heels of the Enforcement Directorate (ED) temporarily attaching 132 acres of land in Dhirubhai Ambani Knowledge City in Navi Mumbai, worth Rs 4,462.81 crore, along with properties at Pali Hill — popularly known as the Ambani family’s residence — Reliance Centre in New Delhi, and several other properties as part of an alleged money-laundering case.
Independent TV defaulted on payments after 2018
Reliance Realty had leased part of the Dhirubhai Ambani Knowledge City (DAKC) premises, along with pre-packaged infrastructure, to Independent TV on November 27, 2017, for running its Direct-to-Home (DTH) business. Independent TV had acquired the DTH business from the Reliance Group through a Share Purchase Agreement (SPA) signed on the same date.
The company paid rentals and utility charges until October 2018, after which payments stopped. Insolvency proceedings were initiated against Independent TV on February 26, 2020. When no resolution plan emerged, NCLT ordered its liquidation on March 17, 2023.
Reliance Realty sought dues before allowing asset inspection
During liquidation, Reliance Realty refused to allow the liquidator and prospective bidders to inspect the company’s assets, demanding payment of pending rent and electricity dues before granting access.
Eventually, Shree Sai Baba Ship Breaking Company emerged as the Successful Auction Purchaser (SAP) for Independent TV’s assets. The sale certificate and possession memo for 1,874 units of inventory were handed over on December 10, 2024.
NCLAT rejects Reliance Realty’s ownership claim
Reliance Realty later approached NCLT, arguing that some of the assets lying in the leased premises belonged to Reliance Communications. NCLT dismissed this plea, directing Reliance Realty to allow the liquidator and the successful bidder to remove the assets without obstruction.
NCLAT, while rejecting Reliance Realty’s appeal, observed that both the Resolution Professional and Liquidator had already verified ownership during the Corporate Insolvency Resolution Process (CIRP). “This was not challenged by the RCom or the Appellant (Reliance Realty) during the CIRP. Thereafter also when the Liquidator took control and possession of the goods/assets lying in the leased premises, this was also not objected to by the Appellant until completion of the auction process,” the order stated.
NCLAT says RCom, not Reliance Realty, was party to DTH transfer
The appellate tribunal also highlighted that Reliance Realty was not a party to the SPA through which the DTH business was transferred to Independent TV.
“We are therefore persuaded to agree with the Respondent No.1 (Liquidator of Independent TV) that if any party should actually have been aggrieved by the impugned order, it should have been the RCom, which was the signatory to the SPA but is currently in liquidation,” NCLAT said.
The tribunal noted that the liquidator of Independent TV had not received any communication from the liquidator of Reliance Communications regarding ownership claims over the assets.
With the input from PTI