Bank of Baroda is the third lender to have declared the loan accounts of insolvent Reliance Communications (RCom) and Anil Ambani as "fraud".

The state-owned bank had sanctioned Rs 1,600 crore and another Rs 862.50 crore in line of credit to the company. Of the total Rs 2,462.50 crore, Rs 1,656.07 crore remains outstanding as on 28 August, according to the lenders' letter disclosed by RCom in the regulatory filing.

Earlier, State Bank of India and Bank of India had classified the loan accounts of Rcom and Ambani as fraudulent, citing alleged fund diversion and violation of loan terms.

RCom has said that it will seek legal advice on the way forward while Ambani has 'categorically denied all allegations and charges and will also be pursuing remedies available to him in accordance with legal advice.'

"It is a matter of record that RCom had a lender consortium comprising 14 banks. After an inordinate lapse of more than 10 years, select lenders have now chosen to initiate proceedings in a staggered and selective manner targeting Ambani," said an official statement of Anil D. Ambani.

In its exchange filing on Thursday, RCom said that the loans and credit facilities cited in Bank of Baroda’s letter relate to the period before the initiation of the corporate insolvency resolution process, and under the Code, must be resolved either through a resolution plan or liquidation, as applicable.

RCom is currently undergoing Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016. The resolution plan was approved by the Committee of Creditors and filed with the National Company Law Tribunal (NCLT), Mumbai on 6 March 2020. NCLT approval is awaited.

RCom is currently managed under the supervision of a Committee of Creditors, led by SBI and overseen by a resolution professional.