NCLAT sets aside insolvency case against Flipkart

NEW DELHI: The National Company Law Appellate Tribunal (NCLAT) has set aside the order of the NCLT to initiate insolvency proceedings against e-commerce major Flipkart. The NCLAT also directed the Interim Resolution Professional (IRP) appointed by NCLT to hand over the records and assets of the company back to its promoter immediately.

NCLAT HAS DIRECTED THE IRP TO HAND OVER THE RECORDS AND ASSETS OF THE COMPANY BACK TO ITS PROMOTER IMMEDIATELY

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.