The National Company Law Appellate Tribunal (NCLAT) has set aside the order of the NCLT to initiate insolvency proceedings against e-commerce major Flipkart.
A three-member bench of the NCLAT released Flipkart from the corporate insolvency resolution process and directed the Interim Resolution Professional (IRP) appointed by NCLT to hand over the records and assets of the company back to its promoter immediately.
Earlier, on October 24, 2019, the Bengaluru Bench of the National Company Law Tribunal (NCLT) had admitted the insolvency plea filed by Cloudwalker Streaming Technologies, an operational creditor of Flipkart. “We set aside the impugned order dated October 24, 2019 passed by the adjudicating authority (NCLT) and the application filed under Section 9 by the operational creditor Cloudwalker Streaming Technologies Pvt. Ltd, company petition is rejected,” said NCLAT.
It further said: “The Flipkart India Pvt. Ltd (corporate debtor) is released from the corporate insolvency resolution process.” NCLAT order came over a petition filed by Neeraj Jain, Director of Flipkart India Private Ltd.
“Interim resolution professional will handover the records and assets of the corporate debtor to the promoter immediately, who will manage the corporate debtor,” it added on its order passed on February 24.
Flipkart’s operational creditor Cloudwalker Streaming Technologies, which used to supply the e-commerce major imported LED TVs, had filed a petition before NCLT contending that Flipkart defaulted for an amount of ₹26.95 crore. However, it was rejected by NCLAT saying that the demand notice delivered under Section 8(1) of the IBC was “not proper and was also incomplete”. “The operational creditor failed to submit any documents to prove in existence of the operational debt and the amount in default,” the appellate tribunal said observing that Cloudwalker Streaming Technologies also failed to submit the copy of invoices and copies of all the documents referred in the application.
Cloudwalker Streaming Technologies had contended that Flipkart contacted it in selling its product of LED TVs and entered into a supply agreement on December 29, 2016.
