Tribunal removes existing resolution professional amid allegations, appoints new RP in Reliance Communications insolvency

New Delhi, July 28, 2025:The National Company Law Tribunal (NCLT) has removed the resolution professional (RP) handling the Reliance Communications insolvency case. “The NCLT appointed a new RP to manage the process.” The change follows allegations against the previous RP and objections from Anil Ambani’s legal team.

The case revolves around Ambani’s personal guarantee for a ₹1,385 crore loan taken for Reliance Communications. The guarantee, executed in September 2016, was later classified as a non-performing asset (NPA) with retrospective effect from August 2016. “The creditors initiated insolvency proceedings in August 2020 under the Insolvency and Bankruptcy Code (IBC).”

Initially, the tribunal had appointed an RP to manage the insolvency process. However, Ambani’s legal representatives filed petitions challenging the RP’s continuation, alleging procedural lapses and bias. “Parties approached the Supreme Court and the Delhi High Court during this period, which delayed the matter further.”“In May 2021, the NCLT recommended moving forward with admitting the company into insolvency. Ambani contested this decision, citing COVID-19 difficulties and legal constraints.”

“The Enforcement Directorate (ED) recently conducted searches on Reliance Group entities, including Reliance Communications and Reliance Power. These raids were part of an investigation into alleged financial irregularities. The searches began on July 24 and ended on July 26. “Investigators linked the raids to transactions flagged during the ongoing bankruptcy proceedings.”

Meanwhile, lenders expressed dissatisfaction with the delays, arguing that such challenges were undermining the resolution process. The newly appointed RP, Prashant Jain, is expected to expedite the proceedings and ensure compliance with IBC guidelines. “Lenders are concerned about recovering funds amid prolonged litigation. They also fear the risk of value erosion of company assets.”

In its order, the NCLT emphasized the importance of maintaining fairness and neutrality in the insolvency process, stating: “Given the concerns raised by both parties, it is imperative to appoint an RP who can act impartially and in close coordination with stakeholders.”

Industry experts believe this development underscores the growing scrutiny over insolvency proceedings in India, especially when high-profile individuals are involved. “The replacement of the RP is rare but not unprecedented,” said a senior insolvency lawyer. “It signals the tribunal’s intent to ensure transparency and fairness in large corporate insolvencies.”

For Ambani, this legal battle is part of a broader financial crisis, with multiple group companies facing insolvency or restructuring. “For lenders, the outcome will decide how much they can recover. This case is one of India’s most high-profile bankruptcies in recent years.”

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