Mumbai: The National Company Law Tribunal (NCLT) has initiated a Corporate Insolvency Resolution Process (CIRP) against the well-known children's fashion brand, Gini & Jony Limited. The decision comes after Pooja Clothing Private Limited, a Bhandup-based firm and operational creditor, filed a petition against the company over an alleged payment default of ₹76,38,073.
In its ruling, the NCLT directed Gini & Jony Limited to make an immediate public announcement regarding the initiation of the CIRP. Additionally, the tribunal ordered Pooja Clothing to deposit Rs 3 lakhs to cover the initial costs of the CIRP. This amount is to be paid to the Interim Resolution Professional appointed to oversee the insolvency proceedings.
The dispute stems from a business arrangement between the two companies, formalized through a Memorandum of Understanding (MoU) on November 4, 2017. According to the MoU, Gini & Jony was responsible for providing patterns, measurements, embroidery, print designs, samples, and technical packs to Pooja Clothing for garment production. Gini & Jony would then issue purchase orders, based on which Pooja Clothing would proceed with manufacturing and delivering the garments.
Pooja Clothing claims it fulfilled its obligations by manufacturing and supplying garments to Gini & Jony, following required inspections and approvals. According to the petition, between February 16, 2018, and November 16, 2018, Pooja Clothing raised invoices totaling Rs 1,28,85,507.
After accounting for payments and adjustments, an outstanding amount of Rs 76,38,073 remained. The last payment of Rs 5 lakhs was made by Gini & Jony on January 11, 2019. Despite numerous reminders, including emails, phone calls, and personal visits, the remaining amount was not paid, leading Pooja Clothing to file a police complaint in 2019, alleging cheating, criminal intimidation, and breach of trust.
Gini & Jony, however, denied the allegations, arguing that the petition was filed with "animus possidendi," a Latin term meaning "intent to possess" or "intent to occupy," and claimed it was not maintainable and should be dismissed. The company refuted all accusations made by Pooja Clothing. The NCLT, after hearing the arguments advanced before it decided to initiation of the CIRP against Gini and Jony Ltd.
