Sony Pictures faces IBC proceedings for unpaid debt relating to movie ‘Padman’

Pooja Film Company, through its proprietor, has instituted insolvency proceedings at NCLT against Sony Pictures Entertainment India (SPE Films), for an unpaid debt pertaining to the movie titled ‘Padman’..The dispute involves three parties, Pooja Film Company, Kriarj Entertainment Private Limited (KEPL) and SPE Films. KEPL is a producer and distributor of cinematographic films in the Indian movie industry and has produced and developed the movie ‘Padman’. KEPL had entered into a distribution agreement with SPE Films wherein it transferred all copyrights pertaining to Padman to SPE Films..Subsequently, KEPL approached Pooja Film Company for providing financial assistance, for production of the movie. A tripartite ‘film financing agreement’ was entered into between Pooja Film Company, KEPL and SPE Films wherein Pooja Film Company transferred a sum of Rs. 19 crores to KEPL and KEPL disbursed this amount to SPE Films, making SPE Films the corporate debtor..SPE Films, who was acting as the distributor was to repay an amount of Rs. 20 crores (including 1 crore interest) using revenues generated from the movie..The petitioners have submitted that the movie generated Rs. 80 crores of revenue in India and Rs. 35 crore overseas. However, the repayment of the loan was not made by the due date and Pooja Film Company sent a demand notice to SPE Films, following which a partial payment of only Rs. 9.52 crores was made..For the Balance 10.5 crores of debt, Pooja Film Company has filed an application with the NCLT Principal Bench in its capacity as an operational creditor..Appearing for Pooja Film Company, Vashu Bhagnani has filed the application through Advocates Ravi Prakash Mehrotra, Ankit Agarwal and Karan Gandhi..(Read the petition)