NCLT admits insolvency plea against Oyo entity, company challenges order
Oyo has challenged the NCLT order initiating corporate insolvency proceedings against its entity, Oyo Hotels and Homes Pvt Limited. Oyo also rubbished bankruptcy rumours doing rounds online.
A plea for corporate insolvency proceeding has been admitted by the National Company Law Tribunal (NCLT) against a subsidiary of Soft Bank-backed Oyo Rooms.
Oravel Stays Pvt Limited, the parent company Oyo Rooms, has challenged the NCLT order initiating insolvency proceedings against OYO Hotels and Homes Pvt Limited (OHHPL).
The NCLT had admitted the insolvency plea against OHHPL on March 30, 20201, and it was filed by a creditor who claimed that OHHPL defaulted on a payment of Rs 16 lakh.
Commenting on the matter, an Oyo spokesperson said, “We are surprised to hear that the Hon’ble NCLT has admitted a petition against OHHPL a subsidiary of Oyo for Rs 16 lakh in a contractual dispute, which dispute is not even with this subsidiary. We have filed an appeal.”
Oyo has already filed an appeal against the NCLT order and approached the NCLAT. “The matter is sub-judice, and we would refrain from commenting further on the merits of the matter at this stage. We have strong faith and belief in our judicial system," the Oyo spokesperson added.
It has also come to light that the NCLT has appointed advocate Keyur Jagdishbhai Shah as the interim resolution professional for the dispute. Oyo’s lenders have been given time till April 15 to submit their claims.
BOGUS BANKRUPTCY CLAIM
Several online reports claimed that Oyo has filed for bankruptcy, citing a PDF and a text message circulating online. Such reports “absolutely untrue and inaccurate”, said Ritesh Agarwal, the founder and CEO of Oyo Rooms.
Agarwal then spoke about the NCLT order initiating insolvency proceedings against OHHPL.
“A claimant is seeking Rs 16 lakhs (USD 22k) from Oyo's subsidiary leading to a petition at NCLT. Oyo has paid that under protest and amount already banked by the claimant,” Agarwal said in a tweet.
3/3 pic.twitter.com/0Btp1aEpfP — Ritesh Agarwal (@riteshagar) April 7, 2021
“Oyo has also appealed with the NCLAT about the matter. Oyo is recovering from the pandemic steadily and our largest markets are operating profitably,” he added.