The National Company Law Tribunal (NCLT) has ruled in favour of food delivery giant Zomato, dismissing an insolvency plea filed by B2B apparel manufacturer Nona Lifestyle over alleged unpaid dues of Rs 1.64 crore, CNBC TV18 reported. The decision brings significant relief to Zomato, which was embroiled in a legal battle over non-payment claims linked to rider uniforms and ICC World Cup 2023 jerseys.
What is the Zomato dispute?
The dispute arose when Nona Lifestyle accused Zomato of defaulting on payments for uniforms supplied to its delivery partners. According to the supplier, it had fulfilled all contractual obligations, including the timely delivery of customised apparel. However, Zomato reportedly refused to accept certain consignments, citing storage concerns and performance issues. Nona Lifestyle also alleged that the company pressured it into offering discounts and later refused payments, labeling the World Cup campaign as unsuccessful.
What is Zomato saying?
Zomato, in its defense, denied the allegations and stated that it had cleared payments for all delivered uniforms within the agreed timeframe. The company further claimed that Nona Lifestyle failed to meet delivery deadlines, leading to penalties as per the contractual terms. It maintained that payments were made after adjusting for these penalties and deducting advance amounts already provided.
Legal proceedings
The legal battle saw multiple proceedings before the NCLT. Initially, the insolvency petition was dismissed in November 2024 due to non-prosecution. However, Nona Lifestyle later sought its revival, with its counsel, Advocate Tanu Singhal, explaining that she was unable to attend the previous hearings. Zomato’s legal team, led by Advocate Abhishek Anand, opposed the plea’s reinstatement, arguing that the dispute involved a contractual disagreement rather than insolvency.
In the latest hearing, the tribunal declined to initiate insolvency proceedings against Zomato, effectively siding with the company’s stance that the matter was a commercial dispute rather than a case of financial default. The verdict is a significant win for Zomato, allowing it to steer clear of insolvency complications while continuing its business operations. Meanwhile, Nona Lifestyle may explore further legal options to recover its claimed dues.