NCLT Kolkatta passes order for winding up of Manthan Broadband Services (“Manthan”) – Big win to Sony Pictures Networks India (SPNI) in connection with recovery of Manthan’s outstanding dues.

According to information available, Manthan got under insolvency proceedings sometime in September 2019. The Committee of Creditors of Manthan passed a resolution for winding up of Manthan and Kuldeep Verma, Resolution Professional had accordingly filed appropriate applications before the NCLT.

SPNI moved the High Court of Kolkata sometime in January 2022 and obtained an order directing NCLT to hear the Manthan matter and pass appropriate order within three months. An attempt to submit a resolution plan to revive Manthan was persistently opposed by Sony along with Alliance Broadband (another creditor of Manthan) and Kuldeep Verma.  The long-pending Manthan matter finally got put to rest with NCLT passing an order on April 6, 2022, directing liquidation of Manthan and appointing Kuldeep Verma as the Liquidator.

SPNI is the only broadcaster who had managed to obtain the title deeds of certain land parcels as a collateral from Manthan under a watertight memorandum of understanding (MoU), which, Manthan failed to honour. Incidentally, it is probably for the first time that an Indian broadcaster had thought of such an idea of using real estate as a collateral for securing outstanding financial dues.

This could be described as a positive development for SPNI since it can now deal with the said portion of Manthan’s land parcel in accordance with the relevant provisions of the IBC.