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Chinese e-tailer Club Factory may invoke 'force majeure' after ban in India: Report

Club Factory is of the view that the Indian government's ban on a number of Chinese apps in June 2020 was beyond the company's control.

March 31, 2021 / 12:31 PM IST
Many Indian companies and vendors are unable to find a representative of Club Factory (Image: Justdial)

Many Indian companies and vendors are unable to find a representative of Club Factory (Image: Justdial)

Club Factory is planning to invoke force majeure, after Indian companies and vendors have approached to recover their dues following the ban on Chinese e-tailer.

Club Factory is of the view that the Indian government's ban on a number of Chinese apps in June 2020 was a situation beyond the company's control, according to a report by The Economic Times.

Cyfuture and Aegis, which used to provide customer-care support to Club Factory, have filed separate cases against the company in the Delhi High Court. The two BPO companies are seeking to recover a combined Rs 5 crore from Club Factory.

Club Factory has hired law firm Khaitan & Co, the report added.

Moneycontrol could not independently verify the story.

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Club Factory had not yet responded when contacted by The Economic Times. Pankaj Bhagat, the lawyer for Cyfuture and Aegis, and Khaitan & Co declined to comment.

Many Indian companies and vendors are unable to find a representative of Club Factory, or office contact to recover their dues.

"For some months, Club Factory just kept saying they are processing our payments," said Sumit Patel of Madeii Ecommerce told the paper. The company sold watches and masks on the Club Factory website.

"Now even the vendors' log-in on the site is not working and we have no way to contact them," Patel said.

When Cyfuture sent a legal notice invoking an arbitration clause to Club Factory in September 2020, it received a response that said the latter had "left" India, the report said.

"Most of the officials of the respondent company have left the country and are proactively looking to evade any liability from its service providers," lawyers for Cyfuture said in court documents cited by The Economic Times.

The Indian government had on June 29, 2020 banned 59 Chinese apps after a clash between soldiers of the two neighbouring countries at Ladakh's Galwan Valley.
Moneycontrol News
first published: Mar 31, 2021 12:31 pm

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