OYO says NCLAT allows plea for setting aside insolvency case against subsidiary

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Updated: July 07, 2021 7:17 PM

Throughout the matter, OYO has been forthcoming and committed to working together with all relevant stakeholders including R K Yadav, the statement added.

OYOOyo said it would also consider issuing shares worth up to Rs 1,400 crore in a pre-IPO placement.

Hospitality firm OYO on Wednesday said the National Company Law Appellate Tribunal (NCLAT) has allowed its plea for setting aside the insolvency case against subsidiary OHHPL and has disallowed intervention of external parties.

“The NCLAT today passed an order concluding the ongoing insolvency case against OYO’s subsidiary OYO Hotels and Homes Private Limited (OHHPL),” OYO said in a statement.

The appellate tribunal’s order disallowed the intervention of external parties, including Federation of Hotel & Restaurant Associations of India (FHRAI), it added.

OYO will continue to work closely with its hotel partners for the closure of any pending claims, the statement said.

“We welcome the decision of NCLAT and that the matter has finally been laid to rest. We had already settled with the original claimant but subsequent interveners with vested interests who were not a party to the case had delayed its closure,” OYO India & Southeast Asia CEO Rohit Kapoor said.

Counsels of OYO, Khaitan & Co said, it was a straightforward case where the two parties involved had settled the matter and there was no room for any interventions which has now been upheld by NCLAT also.

Throughout the matter, OYO has been forthcoming and committed to working together with all relevant stakeholders including R K Yadav, the statement added.

Counsel of R K Yadav, Srinivas Kotni of Lexport had earlier said, “The IBC case regarding OYO’s subsidiary OHHPL in NCLT Ahmedabad is fully resolved and withdrawal application is executed. Further, my client acknowledges the receipt of Rs 16 lakh.” IBC here refers to Insolvency and Bankruptcy Code.

On the judgement, FHRAI Joint Honorary Secretary Pradeep Shetty said FHRAI had filed interventions in the insolvency proceedings against OYO in the interest of a large number of hotels across the country whose claims were unpaid.

Like in the case of a Gurugram-based hotelier, who had originally filed the case against OYO in NCLT, several hotels have not been paid their dues by OYO.

The intervention was filed to reduce the hardship and avoid multiplicity of litigations, he added.

“However, unfortunately, today the Hon’ble NCLAT has allowed the withdrawal as was petitioned by OYO. Now, many hotels across the country facing extreme hardship on account of the shutdowns and closures will be put through additional hardship of filing separate claims before the Hon’ble NCLT,” Shetty said adding that FHRAI may also consider filing an appeal against the order.

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