Carnival Cinemas has not been able to pay up its lenders, employees, vendors and other creditors after business was hurt by the COVID-19 pandemic.
The company is finding it difficult to clear the company's current debt at upwards of Rs 700 crore, The Economic Times has reported.
Employees who have exited the company or were asked to leave since March 2020 (the beginning of the pandemic) have not received their full and final settlements, the report said.
Moneycontrol could not independently verify the story.
"The company has failed to make certain payments due to the pandemic, but at the same time, certain payments which were due to us are also pending from advertisers, etc.," Prashant Kulkarni, head of marketing and sales at Carnival Cinemas, told The Economic Times.
Many employees were transferred to Farmse Fresh, a unit of the company that sells the fresh agriculture produce direct from farm to home.
"We were asked to sell milk and vegetables," cinema manager of a Mumbai property told the publication.
"Carnival Cinemas tried to grow very fast, but it never had financial might like PVR, INOX or Cinepolis," a former executive at the company told the publication."The debt was always high, but the management was running the operations as smoothly as we could. The biggest frustration is that no one is responding or even acknowledging the issue," the former employee said.