Amritsar, NFAPost: E-commerce giant Flipkart India Pvt Ltd today said that the insolvency proceedings initiated by a supplier against the company in the National Company Law Tribunal (NCLT) in Bengaluru has been stayed by the Karnataka High Court.
The Corporate Insolvency Resolution Process was ordered by the NCLT on Tuesday on the pending petition filed by Mumbai-based LED TV supplier CloudWalker Streaming Technologies Pvt Ltd against Flipkart for non-payment of 265.9 million rupees of dues.
CloudWalker had moved the NCLT earlier this year for recovery of the default amount from the e-commerce company
NCLT on Tuesday uploaded an order on its website in which the single judge bench of Rajeswara Rao Vittanala directed that Flipkart has defaulted by non-payment of dues provided repeated requests from CloudWalker.
In a query from NFAPost regarding the proceedings, Flipkart, however responded that “Karnataka High Court has stayed the order of the NCLT in favour of Flipkart. This is an ongoing commercial litigation which we are challenging. At this stage, we have no further comments.”
Flipkart had signed a supply agreement for import and supply of LED TV with CloudWalker in December 2016.
Following the agreement, in January and in March 2017, Flipkart had received the delivery of the first few batches of the LED TVs and had also made payment for the same.
According to CloudWalker, Flipkart thereafter started avoiding to take delivery of the remaining order by giving excuses that Flipkart was out of warehouse storage.
The Mumbai-based company further alleged that Flipkart, in an attempt to gain more profit, had later pressurised the company to provide the TVs at a discounted rate, and the company agreed to it since it was already facing huge losses.
CloudWalker claimed that it had raised payment demand based on Flipkarts purchase order emails, but never received response.
As of March 2018, the LED TV supplier claimed that Flipkart had failed to take delivery of more than 70% of the stock ordered by it.
In June 2019, CloudWalker issued a demand notice under Section 8 of the Insolvency and Bankruptcy Code, but no reply was received for the same, following which the company filed a Section 9 petition.
Flipkart, however, argued that there were no debt or liability towards the company as it had already paid the required amount to CloudWalker.
The case will be further heard in the NCLT on November 25.