The Mumbai-based quick-service restaurant (QSR) chain, Goli Vada Pav Pvt. Ltd., has been accepted into the corporate insolvency resolution process (CIRP) by a bankruptcy court. Vinod Radhakrishnan Nair has been designated as the appointed resolution professional for the company.
Vista Processed Foods Pvt. Ltd., an operational creditor of Goli Vada Pav, brought the case before the Mumbai bench of the National Company Law Tribunal (NCLT) due to the company’s default on payments totaling approximately INR 3.56 crore.
“We are of the considered view that the operational creditor (Vista Processed) has been able to establish the existence of the operational debt due on account of the supply of goods to the corporate debtor (Goli Vada Pav) in respect of which default has been committed by the latter,” said a division bench of judicial member Kuldip Kumar Kareer and technical member Anil Raj Chellan.
“It has also been established that the instant application has been filed within the limitation. Therefore, we find the application to be a fit one to be admitted,” observed the tribunal in its order of September 5.
Prior to the issuance of the order by the NCLAT, Vista Processed Foods’ legal representative contended that, following multiple instances of non-payment of the outstanding dues, they had served a demand notice to Goli Vada Pav on November 15, 2022, and subsequently, a revised demand notice on November 29, 2022, in accordance with the provisions of the Insolvency & Bankruptcy Code (IBC).
“Despite the debt being an admitted debt, the corporate debtor has failed to pay the same,” argued the operational creditor in its application.
In response, Goli Vada Pav, represented by its legal counsel, raised the argument that the demand notice had become time-barred due to the statute of limitations. The company further contested that the operational creditor, Vista Processed Foods, had incorrectly asserted interest claims, as neither the invoices nor the purchase orders contained any mention of an interest clause.
“Suspended management (of Goli Vada Pav) has the option to challenge the order before the appellate tribunal (NCLAT) or alternatively, it can settle the dispute with the operational creditor before the formation of the Committee of Creditors (CoC),” said Nipun Singhvi, managing partner of law firm NSA Legal.
Vista Processed Foods is affiliated with the OSI Group, a US-based corporation known for supplying frozen vegetable and chicken patties to numerous quick-service restaurant (QSR) brands in India. Goli Vada Pav, established in 2004 by Venkatesh Iyer and Shiv Menon, boasts a presence with approximately 300 stores in 100 cities, as indicated on the company’s website.
