India’s bankruptcy court has admitted Reliance Broadcast Network Ltd., the Big FM radio network operator under the Corporate Insolvency Resolution Process (CIRP).
The Mumbai bench of the National Company Law Tribunal (NCLT) has appointed Rohit Ramesh Mehra as an insolvency resolution professional.
This came on a petition filed by IDBI Trusteeship Services Ltd, which had approached the tribunal after the company allegedly failed to repay its dues of over Rs 174 crore.
“We are of the considered view that since the Registered office of the Corporate Debtor (Reliance Broadcast) is in Mumbai this Tribunal has territorial jurisdiction over the present subject matter by virtue of Section 60(1) of the Code,” observed the bench led by judicial member Kuldip Kumar Kareer and a technical member Anuradha Sanjay Bhatia in its order of February 24.
Before the tribunal admitted the petition, the company, through its counsel argued that this tribunal (Mumbai bench of NCLT) lacks jurisdiction, due to the fact that the parties have conferred a nonexclusive jurisdiction to the Tribunals in New Delhi as regards any dispute concerning the agreements pertaining to the petition.
Reliance Broadcast Network, through its counsel, also argued that there is no crystallisation of the alleged debt.
“The petitioner (IDBI Trusteeship) has not provided any particulars of the claim of Rs. 174 crore…the alleged amount in default is in the nature of damages and penal interest which is impermissible under the Code,” argued the company further.
While countering this, IDBI Trusteeship argued through its counsel that the debenture holder had issued a notice on July 14, 2021, to Reliance Capital to make payments, owed by the Reliance Broadcast Network.
Subsequently, the debenture holder again issued a notice of legal notice on November 15, 2021, to the company and its guarantor Reliance Capital to repay the outstanding. However, the company neither replied to the legal notice nor repaid the outstanding dues, hence the trustee approached the tribunal.
According to the company’s website, Reliance Broadcast Network owned by BIG FM is the country’s largest radio network with 58 stations and reaches out to over 1200 towns and over 50,000 villages.
