NCLAT has ordered a stay on the formation of the committee of creditors (COC) in the insolvency and bankruptcy code proceedings against OHHPL, the subsidiary of Oyo’s parent company Oravel Stays.
The Ahmedabad bench of the NCLT had ordered commencement of the corporate insolvency resolution proceedings (CIRP) against Oyo Hotels & Homes based on an application filed by an operational creditor, claiming that the company had not paid dues of Rs 16 lakh. The proceedings were initiated under the Insolvency and Bankruptcy Code (IBC).
In a statement on Thursday, Oyo said: ‘The NCLAT provided a stay for the formation of COC in IBC proceedings against OHHPL, a subsidiary of Oyo. OHHPL appealed the order in front of NCLAT and explained that a demand draft of Rs 16 lakh was issued to the claimant under protest and the claimant has willingly banked the DD.”
Oyo had challenged and appealed against the NCLT order in front of NCLAT on April 7. The company squashed speculation on social media platforms on Wednesday that the SoftBank-backed hospitality company had filed for bankruptcy, which was triggered by rumours following the NCLT order.
“There is a pdf and text message circulating that Oyo has filed for bankruptcy. This is absolutely untrue and inaccurate. A claimant is seeking Rs 16 lakh from Oyo’s subsidiary leading to a petition at NCLT,” Oyo founder Ritesh Agarwal had tweeted on Wednesday.
“Oyo has paid that under protest and the amount is already banked by the claimant,” Agarwal had said.
Following NCLAT’s stay, Agarwal tweeted: “I am so grateful to everyone for their support on social media since yesterday. Thank you for discouraging misleading news and forwarded messages.”