Coffee Day Global’s agreement with IndusInd Bank, NCLAT cancels bankruptcy proceedings

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Coffee Day Global vs IndusInd Bank: Coffee Day Global Limited (CDGL) and its financial lender IndusInd Bank. After this agreement, the National Company Law Appellate Tribunal (NCLA)NCLAT) has canceled the bankruptcy order against the company. This company operates the coffee chain Café Coffee Day. Counsel for CDGL and IndusInd Bank on Wednesday informed the Chennai bench of NCLAT about the settlement and sought permission to withdraw the insolvency case. A two-member bench of Justices M Venugopal and Srisha Merla took their arguments on record and quashed the order declaring CDGL bankrupt. Earlier on August 11, NCLAT, through an interim order, had stayed the National Company Law Tribunal’s (NCLT) direction to initiate insolvency proceedings against CDGL.

NCLT order was challenged

This order of NCLT was challenged before the Appellate Tribunal by Malvika Hegde, director of CDGL and wife of late VG Siddhartha. On July 20, the Bengaluru bench of NCLT had passed this order on a petition filed by the company’s financial lender IndusInd Bank claiming dues of Rs 94 crore. Apart from this, NCLT had also appointed Shailendra Ajmera as interim resolution professional while suspending the board of directors of the company. CDGL had requested a short-term loan of Rs 115 crore in February 2019. According to the annual report of parent company Coffee Day Enterprises Limited (CDEL), CDGL has 469 cafes and 268 CCD Value Express kiosks across 154 cities. It has 48,788 vending machines, which distribute coffee under the brand to corporate venues and hotels.

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