Nona Lifestyle, a B2B apparel manufacturer, has moved the National Company Law Tribunal (NCLT) to initiate the corporate insolvency resolution process (CIRP) against Zomato for alleged non-payment of dues..The company has claimed that the food delivery giant owes it ₹1,64,83,194 for the uniforms worn by delivery partners and other apparel..A coram of Judicial Member Ashok Kumar Bharadwaj and Technical Member Reena Sinha Puri heard the plea..Nona Lifestyle entered into a business relationship with Zomato to supply uniforms for its employees and delivery partners, including merchandise for the ICC World Cup 2023. The company had planned a campaign during the World Cup. As per the petition, Zomato placed multiple orders for various apparel items, including rider t-shirts, trousers and World Cup jerseys, throughout 2023. Nona Lifestyle claims to have fulfilled its obligations by manufacturing and, in part, delivering the ordered goods. However, the company alleged that Zomato has consistently delayed payments and failed to take delivery of substantial portions of the ordered products.According to Nona, Zomato repeatedly delayed payments, returned deliveries citing lack of storage space and even resorted to "threats and warnings" to force Nona Lifestyle to offer discounted rates. Nona Lifestyle has also alleged that Zomato refused to accept delivery of remaining World Cup jerseys, claiming the campaign had "failed," despite the apparel being custom-made and therefore unusable for other purposes..Zomato has, however, denied these claims and contended that Nona Lifestyle consistently failed to meet agreed-upon delivery timelines, resulting in penalties being applied as per their contract. According to Zomato, Nona Lifestyle unilaterally changed delivery schedules, leading to the campaign's failure. Zomato claimed it suffered "substantial reputational and goodwill damage" due to these delays. It also claimed to have paid Nona for delivered jerseys, after deducting penalties and adjusting the advance payment already provided..While the insolvency plea came up for hearing in October 2024, it was dismissed for non-prosecution in November 2024. Subsequently, a petition was filed to restoration of the insolvency plea. .During the hearing of the restoration petition today, advocate Tanu Singhal, who appeared for Nona Lifestyle, told the NCLT that she could not attend the hearing due to a mix up. However, advocate Abhishek Anand, who appeared for Zomato, vehemently contended that the petition should not be restored as it is not maintainable. Anand also contended that there is a dispute over the amount outstanding and that there is a pre-existing dispute between the parties, which precludes an insolvency plea being pursued. .The NCLT in a lighter vein questioned the petitioner’s lawyer if she is aware about what Zomato does. Singhal responded, “I use Zomato, I am in fact a Gold member. However, this is a genuine case.”The Tribunal then urged Singhal to obtain instructions on what course of action Nona would like to take as there is a pre-existing dispute both on facts and on outstanding dues. The case was adjourned to April 3 for further consideration.
Nona Lifestyle, a B2B apparel manufacturer, has moved the National Company Law Tribunal (NCLT) to initiate the corporate insolvency resolution process (CIRP) against Zomato for alleged non-payment of dues..The company has claimed that the food delivery giant owes it ₹1,64,83,194 for the uniforms worn by delivery partners and other apparel..A coram of Judicial Member Ashok Kumar Bharadwaj and Technical Member Reena Sinha Puri heard the plea..Nona Lifestyle entered into a business relationship with Zomato to supply uniforms for its employees and delivery partners, including merchandise for the ICC World Cup 2023. The company had planned a campaign during the World Cup. As per the petition, Zomato placed multiple orders for various apparel items, including rider t-shirts, trousers and World Cup jerseys, throughout 2023. Nona Lifestyle claims to have fulfilled its obligations by manufacturing and, in part, delivering the ordered goods. However, the company alleged that Zomato has consistently delayed payments and failed to take delivery of substantial portions of the ordered products.According to Nona, Zomato repeatedly delayed payments, returned deliveries citing lack of storage space and even resorted to "threats and warnings" to force Nona Lifestyle to offer discounted rates. Nona Lifestyle has also alleged that Zomato refused to accept delivery of remaining World Cup jerseys, claiming the campaign had "failed," despite the apparel being custom-made and therefore unusable for other purposes..Zomato has, however, denied these claims and contended that Nona Lifestyle consistently failed to meet agreed-upon delivery timelines, resulting in penalties being applied as per their contract. According to Zomato, Nona Lifestyle unilaterally changed delivery schedules, leading to the campaign's failure. Zomato claimed it suffered "substantial reputational and goodwill damage" due to these delays. It also claimed to have paid Nona for delivered jerseys, after deducting penalties and adjusting the advance payment already provided..While the insolvency plea came up for hearing in October 2024, it was dismissed for non-prosecution in November 2024. Subsequently, a petition was filed to restoration of the insolvency plea. .During the hearing of the restoration petition today, advocate Tanu Singhal, who appeared for Nona Lifestyle, told the NCLT that she could not attend the hearing due to a mix up. However, advocate Abhishek Anand, who appeared for Zomato, vehemently contended that the petition should not be restored as it is not maintainable. Anand also contended that there is a dispute over the amount outstanding and that there is a pre-existing dispute between the parties, which precludes an insolvency plea being pursued. .The NCLT in a lighter vein questioned the petitioner’s lawyer if she is aware about what Zomato does. Singhal responded, “I use Zomato, I am in fact a Gold member. However, this is a genuine case.”The Tribunal then urged Singhal to obtain instructions on what course of action Nona would like to take as there is a pre-existing dispute both on facts and on outstanding dues. The case was adjourned to April 3 for further consideration.
