NCLT approves insolvency proceeding against Stayzilla

MUMBAI/BENGALURU: Stayzilla, the online home stay ag greg at or that shut shop in February and grabbed headlines after the arrest of its founder, is finally in bankruptcy court. The Chen nai bench of the National Company Law Tribunal (NCLT) has approved insolvency proceedings against Inasra Technologies Pvt Ltd, which runs Stayzilla.

Jigsaw Solutions, an ad agency and Stayzilla’s operational creditor, filed a petition under the Insolvency and Bankruptcy Code (I BC) before NC LT on September 7, claiming the homestay aggregator had defaulted on paying dues of ₹1.69 crore.

The NCLT bench headed by Mohd Sharief Tariq said in its order pronounced and signed on September 15 and uploaded on Monday, that it is satisfied the firm had indeed defaulted on paying its dues. The tribunal also approved the appointment of an interim resolution professional. With this, a 180-day resolution process starts, which may be extended later by 90 days.

“It’s important for companies to be proactively litigious when they find any issues with vendors... under this Act, these vendors can become operational creditors and take the companies to insolvency,” said Yogendra Vasupal, CEO, Stayzilla, in a text message to Mint .“This Act is draconian and biased against companies .”

Jigsaw did not immediately respond to a detailed email questionnaire seeking comment.