The bank, one of the creditors of the media conglomerate, alleged that the company defaulted payment of Rs 149 cr
The National Company Law Tribunal (NCLT) has dismissed the insolvency petition filed by IDBI against Zee Entertainment.
In December 2022, IDBI Bank filed an insolvency plea against the media conglomerate for initiating a corporate insolvency resolution process (CIRP).
Senior Counsel Zal Andhyarujina and Bindi Dave of the law firm Wadia Ghandy & Co., who represented Zee Entertainment stated that since the date of default occurred during the suspension period, it bars the admission of any insolvency petition, under Section 10A of the Insolvency & Bankruptcy Code, 2016.
The tribunal’s bench led by Justice Kishore Vemulapalli and member Prabhat Kumar quashed the petition supporting Zee’s stance. “This application is also not maintainable on the ground that it is not in accordance with the intent and purport of the Code.The present petition deserves to be dismissed,” it said.
The bank is one of the financial creditors of ZEE Entertainment. It said that it had filed the plea claiming that the company defaulted payment of Rs 149 crore.
The bank cited the debt service reserve agreement that it entered into with the company for the financial facility availed by Essel Group’s Siti Networks. IDBI Bank, Axis Finance, IndusInd Bank and many other creditors had approached the NCLT door against the Zee-Sony merger.
Back in April, Zee entered into talks with its creditors, including IDBI Bank, to repay its dues in tranches to expedite the broadcaster’s merger with Sony.
With the repayments out of the way, Zee can merge with Sony to create a media goliath worth $10 billion.
