Supreme Court Verdict Reverses Anil Ambani’s Fortunes With A Denial of ₹8000 Crore Award

Once ranked as the sixth richest person in the world back in 2008, Anil Ambani, now 64, sees his fortunes dramatically overturned following a recent Supreme Court verdict. The apex court has denied an arbitral award of ₹8,000 crore that was in favor of a company from his conglomerate, marking yet another significant blow to the businessman’s rollercoaster career.

Anil Ambani, an MBA graduate from the esteemed Wharton School, is not just known for his notable marriage to Bollywood actress Tina Munim and his two-year stint as a Rajya Sabha MP, but also for his acute business sense. It seemed he had a Midas touch, but the tide turned against him in recent years, leading to him dropping off the billionaire’s list.

In a pivotal move, the Supreme Court struck down the ₹8,000 crore arbitral award to Delhi Airport Metro Express Pvt (DAMEPL), a subsidiary of Anil Ambani’s Reliance Infrastructure. The award was tied to a dispute stemming from a “concession agreement” made in 2008 between DAMEPL and Delhi Metro Rail Corp. As a result of the latest ruling, the court has ordered DAMEPL to return all payments made by the Delhi Metro Rail as per the previous award, which amounts to about ₹3,300 crore.

Despite this setback, Reliance Infrastructure informed via a stock exchange filing that the Supreme Court’s order hasn’t imposed any direct liability on the company. They clarified that Reliance Infrastructure hasn’t received any sum from DMRC or DAMEPL pursuant to the annulled award.

Following Dhirubhai Ambani’s stroke in 1986, a young Anil stepped into higher responsibilities, taking charge of Reliance’s daily financial relations under his father’s mentorship. In the aftermath of their father’s death in 2002, Anil and his elder brother, Mukesh Ambani, inherited the Reliance empire, subsequently undergoing a contentious split in 2005 that saw the brothers taking separate paths in the business world.

Mukesh retained the core Reliance businesses in oil and petrochemicals, whilst Anil helmed the emerging ventures such as telecommunications, power generation, and financial services. The disputes between the siblings were far from over though, as they even battled in court over natural gas supplies for Anil’s power plants. Mukesh emerged victorious, with the Supreme Court ruling that a family agreement could not trump government policy on resource allocations.

Determined to expand, Anil’s borrowing spree for diversifying into the infrastructure, defense, and entertainment sectors began to reflect a precarious strategy. His high-stakes moves yielded mixed results – a court annulled land acquisitions for a key power project, and his decision to scrap a non-compete clause with his brother allowed Mukesh to re-enter the telecom scene, reshaping it drastically with massive investments in a 4G network that eventually nudged Anil’s Reliance Communications (RCom) out of the market.

Anil’s venture into entertainment, with significant investments in Adlabs and DreamWorks, couldn’t withstand the waves of financial troubles that hit his power and infrastructure businesses, leading to enormous debts. Asset sales were seen as corrective measures to reassure investors, yet the situation was grave. As companies under his wing faced mounting financial pressure, insolvency became a grim reality for Reliance Communications. Even his forays into defense manufacturing didn’t pay off as envisioned.

In a stark turn of events in 2019, the Supreme Court contemplated imprisoning Anil Ambani when RCom failed to settle a ₹550 crore due to Ericsson AB’s Indian unit; it was an eleventh-hour rescue from Mukesh Ambani that spared Anil jail time. That same year, Anil found himself embroiled in legal challenges with three Chinese banks regarding a significant loan default. With Reliance Capital declaring bankruptcy in 2021 and missed bond payments by Reliance Infrastructure, it’s evident that Anil Ambani’s business saga continues to be fraught with intense challenges and uphill battles to regain his former stature in the world of commerce and industry.

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