Anil Ambani not a director, clarifies spokesperson after BoB tags RCom account ‘fraud’

The Bank of Baroda (BoB) has become the latest lender to classify the loan account of insolvent Reliance Communications (RCom) and its former director, Anil Ambani, as “fraudulent”, citing alleged misutilisation of loans granted more than a decade ago, according to a regulatory filing to the stock exchange made on Friday.

BoB is the third lender to classify RCom’s account as fraud. Earlier, the State Bank of India (SBI) and the Bank of India (BoI) too had classified RCom’s loan accounts as “fraud”.

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RCom said that it has received a letter from BoB dated September 2, conveying its decision to classify the loan account of the company and promoter Anil Ambani as “fraud” and that it is seeking legal advice regarding BoB’s action.

BoB’s letter to RCom stated that “The account was classified as non-performing asset (NPA) with effect from June 5, 2017”.

According to RCom’s filing, BoB had sanctioned Rs 1,600 crore and another Rs 862.50 crore in line of credit to the company. Of the total Rs 2,462.50 crore, Rs 1,656.07 crore remains outstanding as on August 28, according to the regulatory filing.

However, a spokesperson for Anil Ambani issued a statement that Anil Ambani is not an executive director or a key managerial person of RCom, and had no role in the day-to-day operations or decision-making of the company, which is presently under the control of a resolution professional, Anish Niranjan Nanavaty.

“It is pertinent to note that Anil D Ambani served only as a Non-Executive Director on the Board of RCom from inception in 2006 until his resignation from the Board in 2019. After an inordinate lapse of more than 10 years, select lenders have now chosen to initiate proceedings in a staggered and selective manner, targeting Ambani. Anil D Ambani categorically denies all allegations and charges. He shall pursue remedies available to him in accordance with legal advice,” according to the statement.

The statement mentioned that a resolution plan for RCom has been approved by the committee of creditors and is awaiting approval from the National Company Law Tribunal (NCLT).

RCom stated that during the Corporate Insolvency Resolution Process (CIRP), it is protected from any legal proceedings against it, including the execution of any judgement, decree, or order in any court of law, tribunal, or arbitration panel.