PUNE, India — SoftBank-backed Oyo Rooms, which claims to be the world’s second-largest hotel chain, has managed to save its subsidiary Oyo Hotels and Homes Pvt Ltd from insolvency proceedings, for now.
Rakesh Yadav, the owner of a 21-room hotel in India’s northern city of Gurugram, approached the National Company Law Tribunal (NCLT) against Oyo Hotels in 2019 over unpaid dues of INR 16 lakhs ($21,473). Yadav’s hotel, previously known as Yellow White Residency, was under the Collection-O properties, according to the NCLT filings.
The NCLT, a quasi-judicial body that deals with corporate disputes in India, ordered the commencement of a corporate insolvency resolution process against Oyo Hotels and asked other creditors to submit claims before April 15, 2021.
The hotel chain, one of India’s hottest start-ups valued at $9 billion, won a stay order from the National Company Law Appellate Tribunal (NCLAT) on April 8 after stating that Oyo paid the dues. The NCLAT is a higher tribunal where an aggrieved party can lodge appeals if they are not satisfied with the judgment of NCLT.
“Oyo Hotels appealed the order in front of the NCLAT and explained that a demand draft of INR 16 lakhs was issued to the claimant under protest and the claimant has willingly banked the demand draft,” an Oyo spokesperson told Zenger News.
