NCLAT stays NCLT order initiating insolvency proceedings against Zee

New Delhi: National Company Law Appellate Tribunal (NCLAT) Friday stayed National Company Law Tribunal (NCLT) order initiating insolvency proceedings against Zee in plea by IndusInd Bank.

Punit Goenka, CEO of Zee Entertainment Enterprises, Thursday approached the NCLAT seeking relief against the company's admission to insolvency.

Reacting on the NCLAT decision, Goenka said, "We respect the decision taken by the Hon’ble National Company Law Appellate Tribunal (NCLAT) and remain committed towards protecting the interests of all stakeholders. Our focus continues to be on the timely completion of the proposed merger.”

The Mumbai Bench of NCLT on Wednesday admitted private sector lender IndusInd Bank's insolvency plea against ZEEL.

The case was heard by Justice Ashok Bhushan, the Chairperson and Barun Mitra, Member (Technical). The counsel representing Goenka at the tribunal was Aman Gandhi.

On Thursday, Zee Entertainment said in a statement, “Mr Goenka is taking all the necessary steps as per law, to protect the interests of all stakeholders of Zee Entertainment Enterprises Ltd. (ZEE) and to achieve a timely completion of the proposed merger with Culver Max Entertainment.”

NCLT admitted an insolvency plea after IndusInd Bank before the NCLT claimed a default of Rs 83.08 crore against the media and entertainment firm. Under Section 7 of IBC, a financial creditor may move NCLT for initiation of CIRP over default of Rs 1 crore and above.

According to the filing, ZEEL is a party to the Debt Service Reserve Account (DSRA) Guarantee Agreement entered into with IndusInd Bank for the term-loan facility advanced to another Essel Group firm, Siti Networks Ltd.

Siti Networks, formerly known as Wire and Wireless Ltd, is a multi-system operator promoted by media baron Subhash Chandra-led Essel Group.