Anil Ambani found guilty of SC contempt, to pay Rs 453 cr

New Delhi: The Supreme Court on Wednesday held Anil Ambani, chairman of Reliance Communications, guilty of contempt of court for disobeying the orders to pay Rs 550 crores to Ericsson as per the undertakings given to the court.

A bench of Justices Rohinton Nariman and Vineet Saran also held guilty of contempt three Reliance Companies —RCom, Reliance Telecom and Reliance InfraTel — and slapped a fine of Rs 1 crore each on them, failing to pay the fine will result in one month imprisonment.

The Bench has given an opportunity to Reliance companies to purge contempt by paying Rs 453 crores (which includes interest) to Ericsson within 4 weeks, failing which Anil Ambani will be sent to prison for three months. The Bench asked the Registry to give it to Ericsson Rs 118 cr deposited by the contemnors in the court.

The contempt petitions have been filed alleging that Reliance companies violated the undertaking made before court to pay off debts due to Ericsson worth '550 crores. The company failed to honour the two deadlines of September 30 and December 15, 2018 fixed by the court leading to the filing of two contempt petitions.

Ericsson alleged that Reliance group has “wilfully and consciously” defied the order dated August 3, 2018 and the undertaking given before it to pay up by September-end. The apex court had on October 23, 2018 as last opportunity to RCom for clearing the settlement amount, by setting December 15 as the deadline. When this deadline was also missed, contempt notice was issued to Ambani on January 6.

Writing the judgment Justice Nariman said, “We are of the view that any unconditional apology given that there was no intention to make any wrongful undertaking or that the undertaking was submitted bona fide must be rejected.

Their reply clearly demonstrates the cavalier attitude of the deponent of this affidavit to the highest court of the land.”

The Bench said “We have seen that right from the beginning, the sum of Rs 550 crore was undertaken to be paid, without having to depend upon any act or omission of a third party. To say that the sum of INR 550 crore would be paid only out of sale of assets of the three Reliance Companies is a deliberate misstatement made in the undertakings as well as the applications for extension of time filed before this Court, which was done with the purpose of circumventing the orders of this Court.”

The Bench said it is clear that the three Reliance Companies had no intention, at the very least, of adhering to the time limit of 120 days or to the extended time limit of 60 days plus, as was given by way of indulgence, by the order dated 23.10.2018. The undertakings given on the footing that the amount of INR 550 crore would be paid only out of the sale of assets was false to the knowledge of the three Reliance Companies. This itself affects the administration of justice, and is therefore, contempt of court.

The court held that this is also not a case of accidental or unintentional disobedience. As is clear from the letter dated 21.01.2019, the Reliance Companies are able to pay this amount, but are willfully refusing to do so. This was written by the advocates of the three Reliance Companies, who stated that on 09.01.2019, INR 118 crore had already been deposited with the Registry of this Court, and that the total outstanding, as on date, together with interest, would be roughly Rs. 570 crore. This letter specifically states that the net figure of Rs. 453 crore would be paid by 31.01.2019. There was clear contempt in disobeying the undertakings and held the three companies and their chairmen guilty of contempt which can be purged by paying Rs. 453 cr in four weeks.