Zee Entertainment Clears IndusInd Bank Payment Dues, NCLAT Dispose Of Appeal

Zee Entertainment and Induslnd Bank have announced that all payments due to Induslnd Bank were made by ZEEL on June 30. The NCLAT (National Company Law Appellate Tribunal) has accordingly disposed of the appeal. 

The NCLT (National Company Law Tribunal) order allowing Zee Entertainment to be admitted to insolvency has been set aside for good by NCLAT. The tribunal has asked both parties to pay the cost that the interim resolution professional incurred in the brief period where it was under process. 

Zee Entertainment and Induslnd Bank informed NCLAT that they have reached a settlement in March 2023, and as per the settlement agreement, payment obligations have been undertaken, which will be paid by June 30, or within 7 days of the Sony merger. Certain money has been paid as per the agreement in March 2023, the lawyers had informed NCLAT. 

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

NCLT Mumbai on Feb 22 admitted insolvency proceedings against ZEEL in a plea filed by Induslnd Bank. The proceedings were initiated as Zee was a guarantor for IndusInd Bank’s Rs 150 crore loan to Essel Group's Siti Networks under Debt Service Reserve Account Guarantee Agreement (DSRA). However, it failed to honor the agreement, resulting in an Rs 83 crore shortfall.

The Delhi High Court clarified in September 2022 that Induslnd Bank can initiate insolvency proceedings against ZEEL before the bankruptcy court, despite the ongoing proceedings between the two before the High Court.