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MUMBAI: In a blow to Nimbus Communications, which once held the broadcast rights for India cricket, the Bombay High Court has passed an order for winding up the company due to loan default.
The order has been passed to enable Union Bank of India to recover loans and bank guarantees. The bank had filed a lawsuit six years back. The court has described Nimbus’ financial situation as being absolutely precarious.
“The fact that the company has defaulted even payments of statutory dues like income-tax and service tax etc. shows that the solvency of the company is questionable. The accumulated losses have exceeded 50% of the net worth of the company. It would be worse had the company, not window dressed its accounts,” Justice K.R. Sriram said in his order.
Prakash Shinde, a partner at law firm MDP & Partners who was representing Union Bank told Livemint that the court was convinced that Nimbus is indebted to the bank, and is commercially insolvent.
“The court has acknowledged the fact that even after taking away merging money, the company owed substantial dues to the bank which the company has failed to pay,” he stated.
Bombay HC orders winding up of Nimbus for loan default
The order has been passed to enable Union Bank of India to recover loans and bank guarantees. The bank had filed a lawsuit six years back. The court has described Nimbus’ financial situation as being absolutely precarious.
“The fact that the company has defaulted even payments of statutory dues like income-tax and service tax etc. shows that the solvency of the company is questionable. The accumulated losses have exceeded 50% of the net worth of the company. It would be worse had the company, not window dressed its accounts,” Justice K.R. Sriram said in his order.
Prakash Shinde, a partner at law firm MDP & Partners who was representing Union Bank told Livemint that the court was convinced that Nimbus is indebted to the bank, and is commercially insolvent.
“The court has acknowledged the fact that even after taking away merging money, the company owed substantial dues to the bank which the company has failed to pay,” he stated.
Bombay HC orders winding up of Nimbus for loan default