All Dues Cleared By ZEEL, Says IndusInd Bank. NCLAT Disposes Of Appeal: Report

In February, the NCLT's Mumbai bench had admitted insolvency proceedings against ZEEL in a plea filed by IndusInd Bank

IndusInd Bank had said that Zee was a guarantor for its Rs 150 crore loan to Essel Group's Siti Networks, but it failed to honour the agreement. ( Image Source :Getty )

Zee Entertainment and IndusInd Bank on Monday announced that all payments due to IndusInd Bank were made by ZEEL on June 30 and the the National Company Law Appellate Tribunal (NCLAT) has also disposed of the appeal, as reported by Moneycontrol.

The NCLAT has asked both parties to pay the cost of the interim resolution professional for the period the case was under the resolution process. The tribunal has also set aside NCLT's order allowing the admission of ZEEL for insolvency, according to Moneycontrol.

In February, the NCLT's Mumbai bench had admitted insolvency proceedings against ZEEL in a plea filed by IndusInd Bank. The bank had said that Zee was a guarantor for its Rs 150 crore loan to Essel Group's Siti Networks, but it failed to honour the agreement. IndusInd bank said there was a shortfall of Rs 83 crore.

Later, Punit Goenka, CEO of ZEEL, appealed against the order in the NCLAT. In February itself, the NCLAT stayed NCLT's order directing the initiation of insolvency proceedings against ZEEL.

In March, however, both parties informed NCLAT that they had reached an agreement and the dues would be settled by June 30 or within seven days of the Zee-Sony merger. The NCLAT then ordered the Zee-Sony merger to go forward without considering the litigation.

IndusInd Bank had then informed the tribunal that it would withdraw its objections. The case was then listed to be heard on Monday. 

In March 2023, the parties informed the tribunal that they have reached a settlement and as per the settlement agreement, payment obligations have been undertaken, which will be paid till June 30, or within seven days of the Sony merger.

The NCLAT had ordered that Zee-Sony merger scheme can be considered without this litigation coming. IndusInd had also informed the tribunal that it will withdraw its objections to the merger scheme. The tribunal had also listed the case on July 3, to report completion of settlement.