Another Anil Ambani firm faces insolvency; NCLT admits IBC petition against Business Broadcast News

New service agency — Cogencis Information Services – has initiated insolvency proceedings against Business Broadcast News Private Limited, the erstwhile owner of Business TV India (which was formerly called Bloomberg TV and UTVi). Business Broadcast News Private Ltd is a 100% subsidiary of Reliance Business Broadcast Network Holdings Ltd, a company owned by Anil Ambani. The insolvency petition of Cogencis was admitted by Mumbai bench of NCLT on 4 January 2021.

According to its petition, the corporate debtor committed default in making payment to of Rs. 52.30 lakh to Cogencis, which is engaged in the business of providing real time financial data, news and analytics. Business Broadcast News Pvt Ltd was engaged in the business of publishing and broadcasting.

In 2017, the corporate debtor approached the petitioner to subscribe for its news feed — Cogencis Equity Wire Package. The corporate debtor subscribed for news feed having start bill date 1 July 2017, the subscription form entailed that the payment should be made in quarterly in advance. the corporate debtor, which is owned by Anil Ambani, agreed with terms mentioned in the subscription form that if any invoice remains unpaid for the period of 30 days from the invoice date the Corporate Debtor will be additionally liable to pay interest at 18% per annum on the due date. The termination or discontinuation of service was to be intimated by issuing 90 days prior written notice to the petitioner.

According to the petition, Cogencis had raised various invoices on 3 December 2018 for the period from 1 January 2019 to 31 March 2019 for an amount of Rs 15,00,394 of which the Corporate Debtor paid Rs 7,50,000 on 11 July, 2019. The payment was raised in US dollar but the money had to be paid in INR on various dates but the corporate debtor failed to repay the amount to the petitioner despite of the satisfactory services provide by the petitioner.

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The corporate debtor did not pay the balance amounts and the petitioner thus raised three more invoices dated 1 March, 3 June and 3 September 2019 for the period three quarters beginning 1 April 2019 for Rs 15,14, 412, Rs 14,84,676 and Rs 11,92,181  respectively for each quarter. The Corporate Debtor failed to pay the amounts.

The petitioner had submitted that one Vaibhav Parab in the capacity of the GM IT of the corporate debtor has assured the petitioner to pay the pending amount of Rs 49,41,663 dues in tranches but he failed to repay the debt.

On 13 September 2019, an invoice dated 3 September 2019 for billing period 1st October to 31 December 2019 was returned with a response from the transition team that BTVI channel has suspended its operations on 31 August 2019 and that services of petitioner are no longer required.

Cogencis on 23 September 2019 issued a demand notice to the Anil Ambani firm, demanding a sum of Rs. 52,30,839. When the Corporate Debtor did not respond to the Demand Notice, Cogencis filed an insolvency petition under Section 9 of the Insolvency and Bankruptcy Code (IBC).