In the case of Piyush Jani v. Sporta Technologies Pvt Ltd the National Company Law Tribunal, Mumbai on February 9 allowed the insolvency plea against Sporta Technologies, owner of fantasy sports platform Dream 11 for a debt of over ₹7 crores.
A panel consisting of judicial member Reeta Kohli and technical member Madhu Sinha has designated Madan Bajrang Lal as the interim resolution professional.
Thus, it is concluded that the petition satisfies 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),”
Thge Tribunal stated
The insolvency petition was initiated by Piyush Jani, the resolution professional of Reward Solutions Pvt Ltd, owing to an operational debt amounting to ₹7,61,08,246.
Reward Solutions and Sporta entered into a lease and license agreement on December 27, 2019, for a duration of five years. Allegedly, Sporta failed to make rental payments from the inception of the agreement. Consequently, on April 20, 2021, Reward Solutions sent a demand notice to Sporta.
Following Sporta’s non-compliance with the notice, the current petition was filed.
Sporta, in response to the demand notice, cited the adverse impact of the COVID-19 pandemic and confusion regarding the ownership of the premises as reasons for its inability to negotiate the license fees. Additionally, Sporta stated that it had received a provisional attachment order of the leased premises from the Enforcement Directorate on November 27, 2020.
Sporta further contested the insolvency plea, arguing that Reward Solutions was not the operational creditor it purported to be.
Upon examination, the tribunal noted that the emails presented as evidence indicated the existence of a dispute regarding the payment of debt, a matter which was not contested. Consequently, the tribunal determined Sporta to be the debtor and concluded that Reward Solutions had sufficiently demonstrated Sporta’s default in debt payment.
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
Tribunal Held
Based on these findings, the company was approved for the corporate insolvency resolution process (CIRP).
Sporta was represented by Advocates Dhruva Gandhi and Anuja Jhunjhulwala, who were briefed by M Mullah Associates.
