London: Reliance Group chairman Anil Ambani was a wealthy businessman and now he is not as a result of a “disastrous turn of events” in the telecom market in India, his lawyers told a UK court on Friday as they fought a bid by top Chinese banks to recover $680 million from the Indian businessman.

The Industrial and Commercial Bank of China Ltd Mumbai Branch, on behalf of itself, China Development Bank and Exim Bank of China, had sought summary judgment against Ambani over an alleged breach of a personal guarantee on a debt refinancing loan of around $925 million in February 2012.

Ambani, 60, denies providing authority for any such guarantee, resulting in the High Court action in the UK – the jurisdiction agreed to as part of the terms of the loan agreement.

At a hearing at the Commercial Division of the High Court of England and Wales in London to set the terms for the “conditional order” granted to three Chinese banks last year against the Reliance Communications (RCom) boss, his legal team sought to establish that his net worth was zero once his liabilities were taken into account.

“The value of Mr Ambani’s investments has collapsed since 2012. The Indian telecom sector in particular has been dramatically hit by the Indian government’s change of policy in relation to the grant of spectrum,” notes his defence.

“Whereas Mr Ambani’s investments were worth more than $7 billion in 2012, they are now worth $89 million, and his net worth is zero once his liabilities are taken into account… Quite simply, he was a wealthy businessman, now he is not,” said his barrister Robert Howe.

The banks’ counsel called Ambani’s claims into question and repeatedly referred to his “lavish lifestyle”, involving access to 11 or so luxury cars, a private jet, a yacht and rent-free access to the exclusive Seawind penthouse in South Mumbai.

“So, Mr Ambani’s assertion is that he is massively personally insolvent, is bankrupt. Has he filed for bankruptcy in India,” questioned Justice David Waksman during the course of the half-day hearing.

Ambani’s legal team, including leading Indian lawyer Harish Salve, responded in the negative, followed by a brief reference in court to India’s Insolvency and Bankruptcy Code (IBC) only recently coming into play.

“The evidence overall is that Mr Ambani could not come close to paying a sum of USD 700 million into court,” said Howe.

At the end of the hearing on Friday, the judge indicated that he will hand down his judgement later in the day.

The Chinese banks — Industrial and Commercial Bank of China Ltd Mumbai Branch, China Development Bank and Exim Bank of China — represented in court by barrister Bankim Thanki, sought to establish that Ambani had been “at best economical with the truth” in his evidence statements to the court in relation to his financial means.

They also pointed to a series of instances where Ambani family members had stepped in to bail him out, even as Ambani’s defence sought to establish that their client had no access to the assets and shares under the name of his mother Kokila, wife Tina Ambani and sons Anmol and Anshul in the form of loans.

“Are we seriously to believe that his own mother, wife, and sons can’t help him in his hour of need for the purpose of complying with a conditional order,” said Thanki, who claimed Ambani’s evidence was akin to the proverbial “glossy lipstick on the collar” in terms of some “blatant” lies despite the burden of proof lying with him in the case.

“ADA’s (Anil Dhirajlal Ambani) brother Mukesh is widely regarded as the wealthiest man in Asia and is ranked by Forbes as the 13th richest person in the world and by Bloomberg as the 14th richest person in the world. He has an estimated net worth of USD 55 to 57 billion,” notes the banks’ defence.

“Despite all of this, ADA has failed to address in any detail the possibility of financial assistance being provided by Mukesh or any other member of his family,” it notes.

At the last hearing in the case in December last year, Justice Waksman said he was “very nearly prepared” to grant judgment against Ambani because he found the RCom chief’s evidence “inexplicably incomplete, implausible and highly unlikely”.

“I think it is highly probable that at trial his defence will be shown to be opportunistic and false… I consider that this is a plain case for the making of a conditional order,” Justice Waksman said, as he granted a conditional order in principle to the Chinese banks.

The order means the High Court, after hearing arguments on Ambani’s financial means this week, will set an appropriate amount as an effective court deposit pending a full trial in the case.

On December 16, when the UK High Court dismissed an application filed by Industrial and Commercial Bank of China Limited for a ‘summary judgement’ in its claims of USD 680 million against Ambani, a spokesperson of the RCom boss had said: “Ambani was confident that he will have an opportunity to place the necessary evidence before the UK High Court, in the course of the trial to establish that Chinese banks claim are without any merit”.

The spokesperson said in a statement that Ambani was confident that his position would be fully vindicated once all the facts and the entire evidence is before the Court.