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Reliance Communications Subsidiary's Credit Facilities Classified as 'Fraud' by Canara Bank

Reliance Communications Ltd. (RCOM) has received a letter from Canara Bank stating that the credit facilities extended to its subsidiary, Reliance Telecom Limited (RTL), have been classified as 'fraud'. The bank has also ordered to report RCOM to the Reserve Bank of India (RBI) for reflection in the Central Fraud Registry. RCOM is currently undergoing a corporate insolvency resolution process (CIRP) under the Insolvency and Bankruptcy Code, 2016. The credit facilities in question pertain to the period prior to the CIRP of RCOM and RTL and are required to be resolved as part of a resolution plan or in liquidation. The resolution professional of RTL has filed avoidance applications in terms of the provisions of the Code with the NCLT, which are sub-judice. The impact on the listed entity is protected during the CIRP and immunity is granted against any liability for offences committed prior to the commencement of the CIRP upon the approval of the resolution plan by the NCLT.

• Reliance Communications Ltd. subsidiary's credit facilities classified as 'fraud' by Canara Bank.
• RCOM to be reported to RBI for reflection in the Central Fraud Registry.
• Credit facilities pertain to the period prior to the CIRP of RCOM and RTL.
• Avoidance applications filed by the resolution professional of RTL with the NCLT.
• Protection for the listed entity during the CIRP and immunity against any liability for offences committed prior to the CIRP.