Zomato Faces Insolvency Plea, Supplier Claims Pending Dues Of Rs 1.64 Crore

Zomato, one of India's leading food delivery platforms, is facing an insolvency plea from its uniform supplier, Nona Lifestyle. The supplier has alleged that Zomato has outstanding dues amounting to Rs 1.64 crore, including interest. The case was brought before the National Company Law Tribunal (NCLT), where Nona Lifestyle sought to restore an earlier plea that had been dismissed due to non-prosecution.

NCLT Hearing and Legal Proceedings

The matter was listed before a two-member bench of NCLT, comprising Ashok K Bhardwaj and Reena Sinha Puri, on Monday. However, the tribunal decided to adjourn the case to April 3, asking the petitioner to clarify its next steps. Nona Lifestyle had initially filed an insolvency plea under Section 9 of the Insolvency & Bankruptcy Code (IBC) in 2024, but it was dismissed due to lack of prosecution. The supplier is now seeking restoration of the petition under Rule 11 of NCLT Rules, 2016, which allows the tribunal to reinstate dismissed cases under its inherent powers.

Uniform Supplier’s Claims Against Zomato

Nona Lifestyle, an apparel business, has supplied uniforms for Zomato employees and delivery partners, along with merchandise for brand activations during the ICC World Cup 2023. The company alleges that Zomato not only delayed payments but also failed to accept the complete delivery of ordered merchandise. Due to this, Nona Lifestyle has demanded the initiation of the Corporate Insolvency Resolution Process (CIRP) against Zomato.

Zomato’s Response and Defense

Zomato, through its legal counsel, has denied the allegations and opposed the restoration of the insolvency plea. The company maintains that there is a pre-existing dispute regarding the claims made by Nona Lifestyle. Zomato argues that this legal dispute cannot be categorized under insolvency proceedings, which are meant for companies genuinely unable to meet their financial obligations.

What’s Next?

With the next hearing scheduled for April 3, the NCLT will decide whether the petition can be restored and whether the insolvency proceedings against Zomato will move forward. If the plea is admitted, Zomato could face further legal challenges that may impact its financial and operational stability. The outcome of this case will be closely watched by industry stakeholders and investors.

This development adds to the challenges faced by Zomato, which has been navigating a competitive and evolving market. Whether this case is a mere contractual dispute or a serious financial liability remains to be seen in the coming weeks.