The Swedish firm signed a deal in 2014 to manage and operate RCom's network and past year approached the court over the unpaid dues.
The Ambani brothers, whose public feud over control of the Reliance empire after their father's death in 2002 led to a split in the conglomerate, may have taken a major step to a more harmonious relationship on Monday.
Earlier today, Reliance Communications paid Rs 458.77 crore to Swedish telecom equipment maker Ericsson as per SC directive - clearing outstanding dues and fending-off a jail term for its Chairman Anil Ambani.
"The said transactions have become incapable of being consummated in accordance with the terms thereof, on account of various factors and developments since the execution of the said agreements almost 15 months ago.", RCom said in a regulatory filing.
The SC bench, comprising Justices R F Nariman and Vineet Saran, said the three Reliance companies failed to adhere to the 120 days deadline and 60 days extra given by the apex court to pay the required amount to Ericsson.
In February, the Supreme Court had held Ambani and two directors in contempt of court on a petition filed by Ericsson.
The development may mark a watershed moment in the relationship between the two brothers, who carved their separate businesses in 2005 with Mukesh Ambani getting the oil and petrochemicals business and Anil winning control of power, telecoms and financial services.
RCom, which owes a total 5.71 billion rupees to Ericsson, including a one-time settlement of 5.5 billion rupees and interest payments of 210 million rupees, had already deposited 1.18 billion rupees with the Supreme Court in February.
"The said transactions have become incapable of being consummated in accordance with the terms thereof, on account of various factors and developments since the execution of the said agreements almost 15 months ago...", RCom said. It had threatened to send the billionaire as well as Chhaya Virani and Satish Seth - chairmen of two RCom units, to jail if they fail to pay the dues in four weeks.
The payment comes a day before the deadline set by the Supreme Court expires on Tuesday. Together with Rs 118 crore it had previously paid, RCom has cleared all dues including interest.
The company suffered a blow when National Company Law Appellate Tribunal (NCLAT), last week, refused to free up Rs 260 crore tax refunds withheld by the lenders.
RCom scrip closed at Rs 4 a share on the BSE Monday, 9.30 per cent lower than the previous close.