NCLAT sets aside insolvency process against Dream 11 parent company

The National Company Law Appellate Tribunal (NCLAT) set aside the insolvency process against the parent company of the fantasy gaming platform Dream 11 for a default of Rs 7.61 crore.

Chairperson Justice Ashok Bhushan and Member (Technical) Barun Mitra of NCLAT held that the application moved under Section 9 of the Insolvency and Bankruptcy Code (IBC) by the operational creditor (a person to whom an operational debt is owed) for insolvency was time-barred.

“We are of the view that the application filed by the Operational Creditor under Section 9 was clearly barred by Section 10A, and the Adjudicating Authority (NCLT) committed an error in admitting the Section 9 application by the impugned order of February 9,” the NCLAT ordered.

It said the operational creditor is at liberty to file a fresh application for default committed by Sporta Technologies (parent company of Dream 11) subsequent to the Section 10A (IBC) period and shall have the liberty to seek appropriate remedy for their dues in accordance with the law.

Section 10A deals with the suspension of initiation of insolvency process for any default arising on or after March 25, 2020, for a period of six months or extending to one year.

The NCLAT had earlier stayed the NCLT order which admitted the insolvency plea on February 9 based on an application by Piyush Jani, resolution professional of creditor Reward Solutions.