The National Company Law Appellate Tribunal, Thursday, noted that the order passed by the National Company Law Tribunal to initiate insolvency proceedings against the parent company of India’s largest sports fantasy platform Dream11 shall be stayed for now and the insolvency resolution professional may continue to keep the company as a going concern till then, but take no further steps.
“The impugned order shall stay… No further steps shall be taken by the IRP,” the appellate tribunal noted listing the matter for February 23.
The counsel appearing for the co-founder and COO of Dream11, Bhavit Seth, had requested that no further steps be taken in the insolvency resolution professional, as any action will adversely affect the company which is preparing for the upcoming IPL season.
“We will deposit the money here; the reason payment stopped was because disputes arose as to who the payment has to be made,” said the senior counsel.
Sporta Technologies was admitted into insolvency under Section 9 of the Insolvency and Bankruptcy Code, 2016, earlier this week by the Mumbai bench of the National Company Law Tribunal for default of payment of Rs 7.61 crore.
The tribunal appointed Madan Bajrang Lal Vaishnawa as the interim resolution professional.
The proceedings were initiated by Reward Solutions, which itself is under an insolvency resolution process.
In 2019, the fantasy sports company entered into a lease agreement with Reward Solutions for its office space for five years for a monthly payment of Rs 49.8 lakh for the initial three years and Rs 57.3 lakh for two years, with a three-year lock-in.
Sporta had argued that there was a lack of clarity on who the payment was to be made and that Reward could not be treated as an operational creditor to initiate proceedings.
Source: Economic Times