In yet another major setback for industrialist Anil Ambani, IDBI Bank has officially declared the loan account of Reliance Communications (RCom) as fraud. This move adds to Ambani’s mounting troubles as several banks continue to take action against the former telecom giant over unpaid dues and alleged financial irregularities. The latest declaration by IDBI Bank further complicates the ongoing legal and financial challenges faced by Anil Ambani and his defunct telecom venture.
Reliance Communications Limited (“Company”) has received the Letter dated October 29, 2025 (received on November 03, 2025 by the Company) from IDBI Bank Limited inter alia, stating that the Fraud Examination Committee – I (FEC-I) of IDBI Bank Limited, at its meeting held on September 22, 2025, has decided to declare the account of the Company as “fraud”.
Reliance Communications Limited is under corporate insolvency resolution process pursuant to the provisions of the Insolvency and Bankruptcy Code, 2016. With effect from June 28, 2019, its affairs, business and assets are being managed by, and the powers of the board of directors are vested in, the Resolution Professional, Mr. Anish Niranjan Nanavaty, appointed by Hon’ble National Company Law Tribunal, Mumbai Bench, vide order dated June 21, 2019 which was published on the website of the Hon’ble National Company Law Tribunal, Mumbai Bench on June 28, 2019).
IDBI Bank Ltd. had granted to RCOM/ Borrower a financial assistance / Term Loan of Rs.750.00 crore (Rupees Seven Hundred & Fifty Crore Only). The Borrower was required to pay interest and other charges, as also repay installments of principal, in accordance with the provisions of the loan agreement. The Borrower did not adhere to the terms and conditions on which credit facilities were sanctioned and disbursed.
The account of RCOM/ Borrower was earlier declared as fraud by IDBI Bank on February 18, 2021, based on the observations in the Forensic Audit Report dated Reasoned order for Reliance Communications Ltd. October 15, 2020 of BDO India LLP for the review period April 01, 2013 to March 31, 2017, with the approval of the then delegated authority.
Meantime, the erstwhile Directors of RCOM/ Borrower filed a Writ Petition before the Hon’ble Delhi High Court against the declaration of fraud by State Bank of India. The Writ Petition was finally disposed of by the Hon’ble Delhi High Court on May 12, 2023, by setting aside the actions taken by the lenders/banks against the petitioners under the then prevailing RBI’s Master Directions in light of the Hon’ble Supreme Court’s (SC) Judgment dated March 27, 2023 (in State Bank of India & Ors. Vs. Rajesh Agarwal & Ors.).
The Hon’ble SC has directed that before classifying the account as fraud, the fundamental principles of Natural Justice need to be adhered to and an opportunity of being heard is to be given to the Borrower. In light of the above judgment, RBI deactivated the ‘fraud status of RCOM w.e.f. July 01, 2023.
Accordingly, process of fraud identification was reinitiated in the account of RCOM/Borrower. FEC-I at its meeting held on April 25, 2024, had approved issuance of Show Cause Notice (“SCN”) and SCN dated May 31, 2024, was issued to RCOM/ Borrower to adhere to the fundamental principles of Natural Justice and provide an opportunity of being heard to the borrower before classifying and declaring the account
as fraud.
Download IDBI Bank’s Letter sent to Reliance Communications PDF (This PDF is available for Premium Users Only. Click here to join premium)
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