Flipkart gets stay on insolvency proceedings initiated against it at NCLT
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CloudWalker Streaming, a Mumbai-based supplier of LED TVs, alleged Flipkart did not honour a purchase agreement and had not paid dues totalling Rs 26.95 crore. It petitioned the NCLT bench here that the Insolvency and Bankruptcy Code (IBC) be invoked.
On October 24, accepting the petitioner’s argument, the bench did order initiation of insolvency proceedings. Flipkart appealed to the high court here and, a day later, obtained a stay on the NCLT order, a company spokesperson told Business Standard.
At its next hearing, on October 31, the high court ordered continuation of the stay. The date of the next hearing has not been set yet.
“In view of the above, it is clarified that as on date, Flipkart is not undergoing the corporate insolvency resolution process and is continuing its operations on a going-concern basis, under its present management,” went an e-mailed statement from the company. The matter pertains to an agreement between CloudWalker and Flipkart that dates back to December 2016. CloudWalker sells under a Cloud TV brand. It alleged Flipkart had signed an agreement to purchase stock worth Rs 103.62 crore but only bought goods worth Rs 85.57 crore, and that after much delay.
After receiving two batches of TVs — in January and March 2017 — Flipkart allegedly stopped taking delivery, citing lack of warehousing space. Resulting in unsold inventory piling up with the seller, according to the claims in the order copy dated October 24, posted on the NCLT website. #casansaar (Source - Business Stanard)
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