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The bench also added that considering all legal requirements of the code were fulfilled the petition deserved to be admitted
On February 9, the National Company Law Tribunal (NCLT) allowed an application to initiate the Corporate Insolvency Resolution Process (CIRP) against Sporta Technology Pvt Ltd, owner of fantasy platform Dream11.
The application, filed by Reward Solution Pvt Ltd, was allowed by a bench comprising Judicial Member Reeta Kohli and Technical Member Madhu Sinha of NCLT Mumbai
Reward Solution, the operational creditor, claimed that Sporta Technology had defaulted on an operational debt amounting to ₹7,61,08,246.
The dispute between Sporta Technology Pvt Ltd (Dream11) and Reward Solution Pvt Ltd involved a lease agreement signed in December 2019 for five years.
According to Reward Solution, Sporta Technology defaulted on payments from the beginning of the lease.
The operational creditor argued that Sporta Technology did not respond to the notice, leading to the filing of a Section 9 petition.
Sporta Technology contended that it lost the opportunity to negotiate license fees due to the impact of the COVID-19 pandemic and confusion over the ownership of the premises.
It also mentioned an attachment order from the Enforcement Directorate regarding the leased premises and disputed Reward Solution's status as an operational creditor.
However, after examining emails, the NCLT concluded that Reward Solution had successfully demonstrated its status as a creditor and that Sporta Technology had indeed defaulted on payments.
“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 order reads.
The bench also added that considering all legal requirements of the code were fulfilled the petition deserved to be admitted.
“…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 order reads.
Case title: Piyush Jani, Resolution Professional vs Sporta Technologies Private Limited
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