LONDON — On Friday, a UK court ordered Anil Ambani, chairman of Reliance Group to pay $100 million to three Chinese banks pursuing a US$ 680 million loan agreement recovery.
In fact, Judge David Waksman set a six-week timeline in respect of a deposit to be paid in court pending complete trial in the case, because he concluded that he did not accept Ambani's defense that his net value was nearly zero or that his family would not help him in pushing him to take action.
"In my general conclusion, Mr. Ambani has not satisfied me of his inability to make any payment," said Judge Waksman, who criticized Ambani's defense in relation to his financial means for its lack of candor and openness.
The Reliance Group has stated that it wants to appeal the ruling, which will require the appeal process.
"Mr Ambani is reviewing the UK Court Order and will take legal advice on further appeal remedies," said Anil Ambani Spreadspeaker.
"The order relates to Mr. Ambani's alleged personal liability and will not affect the operations of Reliance Infrastructure Limited, Reliance Power Limited and Reliance Capital Limited," the Spokesman said.
On behalf of the China Development Bank and the Exim Bank of China, the Chinese Industrial and Commercial Bank Ltd. Mumbai Branch welcomed this order and declared that it remained confident in its successive proceedings.
"This is a direct debt claim to recover, in good faith, outstanding credits issued to the RCom (Reliance Communications) with Mr. Ambani's binding personal guarantee that he refused to honor," the banks stated in a statement.
"We remain trustworthy in our argument. We hope that Mr. Ambani will comply with the order of the court and look forward to a speedy trial resolution," said the release.
Another senior representative of the Reliance Group said the Chief of RCom intends to seek additional remedies in appeal, based on legal advice and is confident that he will have the chance to establish that the Chinese claim is without merit.
Previously, in a half-day hearing, the court said that the chairman of the Reliance Group, Anil Ambani, was a wealthy businessman and is not now the result of a "disastrous turn of events" on the India telecoms market.
In February 2012, the Chinese banks sought a summary verdict against Ambani in connection with an alleged personal guarantee violation on debt refinancing loans amounting to some US$ 925 million.
Ambani, 60, disputes the existence of any such guarantee power so that the High Court case in the UK is subject to the jurisdiction decided under the terms of the loan agreement.
During the hearing at the High Court of England and Wals Commercial Division in London to set the terms for the "conditional order" against the boss of Reliance Communications (RCom) granted to three Chinese banks last year, the Legal Team tried to ascertain that his net value had been nil after his liabilities were taken into account.
"Since 2012, Mr. Ambani's investment value has plummeted. In fact, the Indian telecommunications industry has been affected by the Indian government's change in policy with respect to spectrum grants," states his defense.
"Whereas Mr Ambani's investments were worth more than US$ 7 billion in 2012, they now valued US$ 89 million and his net value is zero, given his liabilities ... He was just a wealthy businessman and not now," said Robert Howe, his barrister.
The banks ' counsel challenged Ambani's statements and spoke repeatedly about his "lavish lifestyle."
"Thus, Mr Ambani says that he is financially insolvent and practically bankrupt. During the half-day trial, Justice David Waksman challenged that he had filed for bankruptcy in India.
Ambani's legal team including leading Indian lawyer Harish Salve reacted negatively and a brief reference in court to the recent implementation of the Indian Insolvency and Bankruptcy Code (IBC).
"The cumulative reality is that Mr. Ambani could not come near the court to pay USD 700 million," Howe said.
The banks, represented by barrister Bankim Thanks, tried to establish that Ambani, in his testimony before the court concerning his financial means was "just economic with the facts."
They also pointed out several cases in which family members of Ambani entered to bail him out, although the defense of Ambani tried to clarify that his client had no access to the properties and shares under the names of his mother Kokila, his wife Tina Ambani, and his sons Anmol and Anshul as loans.
"We seriously believe that in his hour ' s need his own mother, wife, and sons can not help to comply with the conditional order," said Thanks, who claimed that the evidence of Ambani was similar to the proverbial "glossy lipstick on the pig" in the sense that it had some "blatant" lies despite the burden of evidence in the case with him.
"Brother Mukesh of ADA (Anil Dhirajlal Ambani) is widely recognized as the richest individual in Asia, ranked as the 13th richest person in the world by Forbes, and as the 14th richest in the world by Bloomberg. It has an estimated net value of between 55 and 57 billion USD," the banks mentioned in court.
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