Mumbai-based fast food chain Goli Vada Pav has been admitted to insolvency resolution by the National Company Law Tribunal (NCLT) Mumbai bench. This follows the company’s failure to repay operational debts of Rs 3.56 crore to supplier Vista Processed Foods.
The NCLT passed the insolvency order on September 5th based on a plea filed by Vista Processed Foods. According to the plea, Goli Vada Pav failed to make payments for supply of goods in 2020, 2021 and 2022, despite providing signed balance confirmations admitting the undisputed debt. Vista claimed that Goli Vada Pav did not repay the debt even after repeated reminders. Goli Vada Pav’s defense that the plea was time-barred by limitation was rejected by the NCLT. It observed that the operational creditor had established the debt and default, and the application was within limitation period.
About Goli Vada Pav
Founded in 2004 by Venkatesh Iyer, Goli Vada Pav is a leading vada pav restaurant chain originating from Mumbai. It currently operates over 300 outlets across more than 100 cities. Known for its signature vada pav, it has received awards like the Golden Spoon Award.
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Dispute Details
As per Vista Processed Foods’ plea, Goli Vada Pav failed to clear operational debts of Rs 3.56 crore despite acknowledging it through signed balance confirmations in 2020-2022. The NCLT observed the debt and default were established.
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Insolvency Process
With Goli Vada Pav admitted for insolvency, Vinod Radhakrishnan Nair has been appointed as resolution professional. The NCLT order directs Vista Processed Foods to deposit Rs 3 lakh as initial costs. The suspended management can challenge the order before NCLAT or settle the dispute with the creditor.
Conclusion
The NCLT insolvency order adds to the woes for Goli Vada Pav which has struggled to scale up nationally despite initial success in Mumbai. With over 300 outlets across India, its financial troubles amid a broader slowdown in consumer demand poses concerns for its large workforce. The insolvency resolution process will aim to bring the company back on sound financial footing.
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