Department of Telecommunications Orders Partial Encashment of Bank Guarantees from SBI and BoB Against Reliance Communications Limited
The Department of Telecommunications (DoT), Government of India, has ordered the partial encashment of Financial Bank Guarantees (FBGs) furnished by banks on behalf of Reliance Communications Limited (RCOM) and its subsidiary, Reliance Telecom Limited (RTL). The actions stem from defaulted outstanding License Fee dues pertaining to various financial years.According to communications received from DoT on August 18, 2026, the encashment pertains to obligations under relevant License Agreements for both entities.
RCOM and State Bank of India Guarantee
Regarding Reliance Communications Limited (RCOM), the DoT held an FBG issued by State Bank of India (SBI) towards security for due performance of its obligations. The original Bank Guarantee amount was ₹5,73,49,933, which had a maturity date set for January 23, 2027.The DoT communicated that the licensee defaulted in payment of outstanding License Fee dues spanning FY 2023-24, FY 2024-25, and FY 2025-26. Consequently, DoT requested SBI to partially encash the FBG for an amount of ₹5,55,42,271 immediately.
RTL and Bank of Baroda Guarantee
Similarly, concerning Reliance Telecom Limited (RTL), the DoT held a Financial Bank Guarantee issued by Bank of Baroda (BoB) as security for compliance under its License Agreement. The original amount of this guarantee was ₹2,00,00,000, which was set to expire on June 23, 2027.DoT stated that RTL defaulted in the payment of outstanding License Fee dues for FY 2023-24, FY 2024-25, and FY 2025-26. In response, DoT requested Bank of Baroda to partially encash this guarantee amounting to ₹16,25,000 within two working days.
Financial Overview of Encashment
The partial encashment across both entities totals a combined amount, as follows:| Entity | Bank Guarantee Provider | Original Amount | Partial Encashment Amount Requested by DoT |
|---|---|---|---|
| Reliance Communications Limited (RCOM) | State Bank of India | ₹5,73,49,933 | ₹5,55,42,271 |
| Reliance Telecom Limited (RTL) | Bank of Baroda | ₹2,00,00,000 | ₹16,25,000 |
The total aggregate amount proposed for partial encashment across RCOM and RTL is ₹5,71,67,271.
Company Status and Implications
Reliance Communications Limited confirmed that it is currently examining the detailed financial and legal implications arising from DoT's communications. This examination includes the consequential impact on the liabilities, claims, and obligations of both RCOM and RTL related to the underlying License Fee dues.The company has taken note of these developments and is reviewing the basis and manner of the partial encashment alongside all consequential implications before taking further steps in accordance with applicable law.
RCOM Stock Price Movement
Shares of Reliance Communications Limited are rallying to ₹0.81 as of 1:39 PM today, climbing 1.25% in live trading. The stock has seen robust activity, with a total traded volume reaching 1.49 million shares during the current session.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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