OPPO could face insolvency proceedings as NCLT issues notice over unpaid dues of Rs 17 Crore

Acting on an application accusing smartphone brand OPPO of non-payment of dues, the Chandigarh bench of the National Company Law Tribunal (NCLT) recently issued a notice to the Chinese smartphone maker, hinting that it may face the Company Insolvency Resolution Proceedings (CIRP) under the Insolvency and Bankruptcy Code, 2016.

The petition was filed by Hipad Technology India Private Limited, a Chinese phone manufacturing company and also one of OPPO’s suppliers. He accused OPPO of not paying its outstanding debt of Rs 17 crore.

According to NCLT’s notice on September 9, if OPPO does not give the court confidence that it is able to repay its debt to Hipad, the NCLT will in all likelihood appoint an insolvency resolution professional to replace the current promoters of the company. .

Hipad, which manufactured mobile phones in India until 2019, was itself subject to insolvency proceedings in December 2020 when one of its financial creditors, the Industrial and Commercial Bank of China (ICBC ), approached the NCLT for non-payment of loans.

A source close to Hipad tells Outlook that the NCLT has appointed a liquidator who is currently providing an update on the company’s financial strength. “In doing so, the liquidator realized that OPPO had to pay Rs 17 crore to the company for the services and supplies it performed,” he said, requesting anonymity.

In June 2022, Hipad decided to file an application under Article 9 of the IBC, which deals with the initiation of CIRP by the operational creditor, Hipad in this case, after OPPO failed to fulfill its financial obligations even if the liquidator raised a request in April 2022.

Outlook contacted the office of Ajit Kumar, Hipad’s liquidator, but was unavailable for comment. Outlook also contacted Rishabh Maheshwari, OPPO India’s in-house legal counsel, but did not receive a response before the article was published.

Founded in 2004, Oppo claims to be the world’s leading manufacturer and innovator of smart devices with a presence in over 50 countries and regions.

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