The National Company Law Appellate Tribunal (NCLAT) has refused to entertain petition to start insolvency proceedings against OYO Hotels and Homes Pvt Ltd (OHHPL).
Gurgaon-based hotel company had made insolvency claims worth 16 lakh on OYO and was undergoing the process.
The insolvency petition against OYO rooms was allowed by the National Company Law Tribunal’s Ahmedabad bench.
The bench had appointed an interim resolution professional (IRP) and had allowed him to verify claims made by the creditor.
OYO has said that the issue was regarding a contractual payment dispute and it has nothing to do with insolvency.
The complainant was given the full payment under the contracted amount and the subsidiary was not even involved in the said process.
Claims of other contractual hotels
Hotel association has said that the claims of the creditors had to be settled since proceedings had been admitted under Insolvency and Bankruptcy Code (IBC).
The tribunal has said that approval of 90 percent of creditors is required for withdrawing proceedings against an entity.
Since a committee of creditors has not been set up, there is no requirement for getting approval from the 90 percent creditors.
The company had claimed that issue was being settled and there was no need for insolvency. The creditors had even agreed for withdrawing the complaint.