NCLT Mumbai admits insolvency plea against Dream 11

The National Company Law Tribunal at Mumbai on February 9 admitted an insolvency plea against Sporta Technologies, owner of fantasy sports platform Dream 11 for a debt of over ₹7 crores. [Piyush Jani v. Sporta Technologies Pvt Ltd].A coram of judicial member Reeta Kohli and technical member Madhu Sinha appointed Madan Bajrang Lal as the interim resolution professional."Thus, it is concluded that the petition satisfies all legal requirements for admission and the same is also filed well within the limitation period of 3 years. Considering the above facts, we are of the considered view that this Petition deserves to be admitted under Section 9 of the Insolvency Bankruptcy Code (IBC)," the 11-page order stated. .The plea seeking insolvency was filed by Piyush Jani, resolution professional of Reward Solutions Pvt Ltd for an operational debt of ₹7,61,08,246. Rewards Solutions entered into a lease and license agreement with Sporta on December 27, 2019 for a period of 5 yearsSporta allegedly did not pay rent right from the beginning and on April 20, 2021, Rewards Solution sent a demand notice to Sporta. When Sporta failed to comply with the notice, the present petition came to be filed..Sporta responded to the demand notice claiming that it lost its rightful opportunist to negotiate the license fees due to impact of the ongoing COVID-19 pandemic and confusion with regard to the ownership of the flat. Sporta claimed to have received copy of a provisional attachment order of the leased premises from the Enforcement Directorate on November 27, 2020. In response to the insolvency plea, Sporta also claimed that Rewards Solution was not the operational creditor as it claimed to be. .The tribunal concluded that the emails brought on record showed the presence of dispute for payment of debt which was also not disputed. Thus, it concluded that Sporta was the debtor and Rewards Solutions had successfully demonstrated the default in payment of debt."Sporta Technologies is very much a corporate debtor and the petitioner has successfully demonstrated the existence of 'operational debt' and 'default' committed by the Sporta along with the absence of any pre-existing dispute between the parties in consonance with the relevant provisions of the Code", the bench said..With these observations, the company was admitted for the corporate insolvency resolution process (CIRP). .Advocates Dhruva Gandhi and Anuja Jhunjhulwala briefed by M Mullah Associates appeared for Sporta. [Read order]