NCLT initiates insolvency proceedings against Flipkart; Bengaluru HC stays order

News Network
November 7, 2019

Bengaluru, Nov 7: The National Company Law Tribunal (NCLT) initiated insolvency proceedings against the Walmart-owned e-commerce company Flipkart for defaulting on Rs 18 crore payment to one of its suppliers. However, the NCLT order was stayed by the Karnataka High Court after Flipkart approached it. 

The Bengaluru bench of the NCLT initiated Corporate Insolvency Resolution Process (CIRP) against Flipkart India under the Insolvency and Bankruptcy Code, 2016, after a case was filed by Cloudwalker Streaming Technologies seeking CIRP against Flipkart on the grounds that it has committed default on payment of Rs 26.95 crore on supply of LED TVs.

A moratorium had been placed prohibiting the pending case judgements, sale of assets and property, and the Board of Directors asked to extend full cooperation to the insolvency resolution process. 

In its petition, Cloudwalker told NCLT that Flipkart failed to collect all the TVs ordered, failed to pay the excess charges and costs as promised and failed to honour its commitment. Cloudwalker claimed that due to Flipkart's failure in fulfilling its commitment, it was forced to unload the uncollected goods at heavily marked-down price, just so it could remain afloat.

Cloudwalker said it had sent a demand notice to which there has been no reply from Flipkart, and said that it has "consistently and persistently failed, omitted and neglected to discharge its admitted and acknowledged debt and liability." Cloudwalker, in the petition, said that it is apparent that Flipkart is commercially insolvent and is unable to pay its debts. 

Flipkart argued in NCLT that the petition is not maintainable either in law or on facts and it is liable to be rejected with exemplary costs.

Flipkart said that it has already paid Rs 85.57 crore and the allegation that it has no money to pay its liabilities or debt is "baseless, frivolous, bereft of truth and filed with malafide intentions".

"Karnataka High Court has stayed the order of the NCLT in favour of Flipkart. This is an ongoing commercial litigation, which we are challenging. At this stage, we have no further comments," Flipkart spokesperson said in an email response.

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News Network
June 4,2020

Bengaluru, Jun 4: The Special Investment Promotion Task Force, constituted by the Karnataka government, held its first meeting in Vidhana Soudha, Bengaluru on Wednesday, June 3.

The first meeting of the task force was held under the chairmanship of Chief Secretary, Karnataka government.

The body is seeking to find ways to attract the disenchanted multi-national corporations (MNCs) which are looking to shift their manufacturing base away from China in the back-drop of the COVID-19 outbreak.

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News Network
June 3,2020

Koppal, Jun 3: Opposition Leader in the Karnataka Legislative Assembly Siddaramaiah on Wednesday said that allegedly there was deep crisis in the state BJP but categorically denied any role of Congress in it.

Addressing a press conference here, the former Chief Minister said 'I and my party have nothing to do with the developments in the ruling party. I came to know through media that some 25 BJP MLAs allegedly not satisfied with the way of functioning of the government. The Congress party is not interested in what is happenings in BJP and if the government falls on its own, then Congress might stake claim to form the government eventually".

Mr Siddaramaiah alleged that the State’s BJP government was trying to 'subvert the Constitution and Panchayat Raj Laws' by postponing election to Gram Panchayats citing spread of COVID-19.

'The Commission has not provided any information so far about the preparation of electoral rolls, fixing of reservation to seats, and calendar of events for holding elections. It is the duty of the Commission to hold elections as per the Karnataka Gram Swaraj and Panchayat Raj Act,' he further said.

The EC on May 28 postponed elections to GPs citing 'exceptional circumstances' prevailing in Karnataka following the coronavirus pandemic situation. Elections to as many as 5,800 GPs scheduled to be held by next month with the ending of their terms have been put off, and fresh dates were yet to be announced.

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News Network
April 24,2020

Thiruvananthapuram, Apr 24: Kerala Chief Minister Pinarayi Vijayan on Thursday said that there is no community spread or the expected phase three spread of coronavirus in the state so far but the threat continues.

Speaking to media persons here on Thursday, Vijayan said that Kasargod, Kannur, Kozhikode, and Malappuram districts will be in the red zone with full restrictions.

"All the other ten districts in the State will be in the orange zone. With the detection of new cases today, the status of Kottayam and Idukki districts have been changed from green to orange. The district administration will decide on the hotspot areas to be closed," he said.

He said there would be an increase in the number of random tests in the red zones.

"In an effort to confirm that there is no community spread in the State, random antibody tests would be conducted among health workers, police personnel, home delivery persons, volunteers and migrant labourers," he added.

The Chief Minister said that COVID-19 labs set up at the Pariyaram Government Medical College at Kannur and the Kottayam Medical College have got the approval from the ICMR for coronavirus testing. The lab at Kannur Medical College will start functioning from Friday.

The UV sterilised lab, spread over 2,200 sq ft is equipped with four real-time PCR machines. In the first phase, this lab will be able to do 15 tests per day, which will be gradually increased to conduct 60 tests in the next phase.

"With the opening of these two new labs, tests to detect COVID-19 will be conducted in 14 government labs in Kerala. Apart from this, there are two private labs also in Kerala which are doing these tests. Since the number of coronavirus cases is again increasing in the State, the government has decided to procure ten real-time PCR machines to ramp up testing," he added.

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