In a surprising development, it was reported by many websites on Tuesday (April 6) publish reports that OYO has filed for bankruptcy under IBC 2016 and the NCLT has ordered the beginning of a corporate insolvency resolution process of OYO Hotels and Homes Private Limited.
Oyo founder and CEO Ritesh Agarwal has rejected the reports that Oyo has filed for bankruptcy and termed the news as fake. “There is a PDF and text message circulating that claims OYO has filed for bankruptcy. This is absolutely untrue and inaccurate. A claimant is seeking INR 16Lakhs (USD 22k) from OYO’s subsidiary leading to a petition at NCLT,” he said in a series of tweets.
There is a PDF and text message circulating that claims OYO has filed for bankruptcy. This is absolutely untrue and inaccurate. A claimant is seeking INR 16Lakhs (USD 22k) from OYO's subsidiary leading to a petition at NCLT. 1/3— Ritesh Agarwal (@riteshagar) April 7, 2021
“OYO has paid that under protest and amount already banked by the claimant. OYO has also appealed with the NCLAT about the matter. OYO is recovering from the pandemic steadily and our largest markets are operating profitably.”
— Ritesh Agarwal (@riteshagar) April 7, 2021Advertisement
Ritesh further added,
OYO has challenged NCLT Order against its subsidiary for an amount of 16 Lakhs
- OYO has a subsidiary called OHHPL
- The NCLT admitted an order against its subsidiary for an amount of 16 Lakhs
- OYO has challenged the order in NCLAT
- This has earlier happened in Flipkart and set aside
OYO has challenged NCLT Order against its subsidiary for an amount of 16 Lakhs. The Subsidiary name is OHHPL. This is not the first time that a petition has been accepted by NCLT for a new age company. In Feb 2020 Flipkart also received such a petition and it was set aside.
Statement on behalf of OYO spokesperson, “We are surprised to hear that the Hon’ble NCLT has admitted a petition against OHHPL a subsidiary of OYO for INR 16 Lakhs in a contractual dispute, which dispute is not even with this subsidiary. We have filed an appeal. 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 company also said, the INR 16 L in dispute has already been paid to the claimant under protest by the entity (other than OHHPL) with whom the dispute was raised.
Flipkart had a similar matter in February 2020 where a court for a small operational creditor had allowed NCLT petition but it was promptly set aside by NCLAT.
Earlier, it was reported that that the corporate insolvency resolution process of Oyo Hotels and Homes was issued by Ahmedabad branch of NCLT on March 30.