Central Bank of India Declares RCom Subsidiary Reliance Telecom Loan Accounts as Fraud

Central Bank of India has categorised the loan accounts of Reliance Telecom Ltd (RTL), a subsidiary of Reliance Communications Ltd (RCom), as ‘fraud’. The telecom firm, part of the Anil Ambani-led group, is presently undergoing insolvency resolution proceedings under India's bankruptcy code. 

Credit Facilities Declared as Fraud Relate to Pre-Insolvency Period 

On December 23, 2025, RCom stated in a stock exchange filing that the public sector bank declared the loan accounts of RTL as fraudulent. However, it clarified that these accounts and associated transactions pertain to the period prior to RTL entering into the corporate insolvency resolution process (CIRP).  

As per the Insolvency and Bankruptcy Code (IBC), such matters are to be addressed through the approved resolution plan or liquidation process. 

The Resolution Professional (RP) appointed for RTL has already identified specific transactions flagged by an independent forensic auditor. These transactions are now the subject of avoidance applications submitted to the National Company Law Tribunal (NCLT). 

Resolution Plan Awaiting NCLT Approval 

Resolution plans for both RCom and RTL have been approved by their respective committees of creditors and are currently pending approval by the NCLT. Upon approval, such plans offer legal immunity to the corporate debtor against past liabilities, subject to Section 32A of the Code.  

This includes any identified offences committed before the start of insolvency proceedings, provided there is a change in management and control as part of the resolution process. 

Legal Shield During CIRP Under IBC 

Both RTL and RCom are protected from any ongoing or new legal actions related to pre-CIRP matters under the IBC. Section 238 of the Code provides it with an overriding effect over other laws in case of conflict.  

RCom mentioned that the resolution plan will determine the course of action concerning the transactions marked for review during the insolvency proceeding. 

Read More: 49 Bank Employees Arrested for Unauthorised NRI FD Withdrawals Totaling ₹8 Crore! 

Conclusion 

Central Bank of India’s declaration relates to credit facilities predating RTL’s insolvency proceedings. As per IBC proceedings, their treatment is now reliant on the resolution plan decided by the creditors and awaiting NCLT's consideration. 

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