Zee's Punit Goenka moves NCLAT against NCLT order initiating insolvency process

Zee's Punit Goenka moves NCLAT against NCLT order initiating insolvency process

IndusInd Bank initiated the CIRP even as the media company has been seeking approval for its merger with Sony Pictures

Punit Goenka, the managing director and CEO of Zee Entertainment Enterprises has approached the National Company Law Appellate Tribunal (NCLAT), New Delhi, against an order of the National Company Law Tribunal (NCLT), Mumbai, initiating the Corporate Insolvency Resolution Process (CIRP) against his company.

Recently, the NCLT bench comprising Justice HV Subba Rao (judicial member) and Madhu Sinhathe (technical member) passed an order allowing an application filed by IndusInd Bank under the Insolvency and Bankruptcy Code (IBC) seeking CIRP proceedings against Zee.

Goenka challenged the order in NCLAT through a petition, which is still to be listed for a hearing. The development is likely to affect the potential merger between Zee and Sony Pictures Networks India (SPNI).

While Zee is seeking approval for the merger, Axis Finance, IDBI Bank, and IndusInd Bank are opposed to it as debtors of the company. Also, as an operational creditor and company's claimant, the Indian Performing Rights Society Ltd (IPRS) is also against it.

IndusInd had approached NCLT against Zee for the resolution of the total financial debt of Rs.92,74,25,742 (approximately Rs.90 crores).

Thereafter, Zee filed a cross-application challenging the maintainability of the petition by the bank.

However, the tribunal rejected its application and allowed the bank's petition. NCLT also turned down Zee's oral request to stay the order for two weeks.

It appointed Sanjeev Kumar Jalan, the partner at BDO India LLP, as an interim resolution professional. (BDO is an international network of accounting, tax, and advisory firms).

While senior advocate Ravi Kadam appeared for IndusInd Bank, senior advocate Zal Andhyarujina appeared for Zee before the NCLT.