Flipkart faces fresh insolvency petition as NCLT seeks response over ₹1.7 crore dues

MUMBAI: A special bench of the National Company Law Tribunal (NCLT) in Bengaluru has issued a notice to Flipkart seeking a response to Applabs Media Pvt Ltd’s insolvency application filed against the e-commerce company alleging almost $200 million in unpaid dues. ₹1.7 crore.

A two-judge bench comprising Justice Mahendra Khandelwal and Justice Radhakrishna Sreepada heard the petitioner, who had filed the objection under Section 9 of the Insolvency and Bankruptcy Code.

The court said, “The corporate debtor should be notified to submit his answer and statement. Notification should be made by any means and proof of notification should be submitted.” The next hearing will be held on July 14.

Applabs Media, an artificial intelligence-focused ad technology company, claimed that Flipkart did not pay in this regard ₹1.7 crore under the marketing agreement dated December 5, 2019. The company provided cost-per-transaction advertising campaigns on Flipkart’s mobile app and claimed to have issued three invoices under the agreement, which were due within 45 days.

Flipkart acknowledged its payment obligations in an email on May 15, 2023, Applabs Advisor said.

“…we have received confirmation from the finance team that the payment will be received as soon as possible,” the lawyer said, referring to Flipkart’s email response.

Corporate debtors

The petition is a new plea filed under Section 9 of the IBC, which empowers operational creditors such as vendors, suppliers and employees to initiate corporate insolvency resolution process against a defaulting corporate debtor before the NCLT.

Flipkart did not respond Mint‘s questions seek comment on the subject.

This is the second case filed against Flipkart. In March, the NCLT bench in Bengaluru issued notice to Flipkart under Section 9 of the IBC on a petition filed by Netambit Value First Services Pvt Ltd alleging default. ₹4.37 crore in connection with affiliate marketing services provided to the company. The issue is still being heard.