A vacation bench of the Delhi High Court has directed MX media to retain (keep aside) a sum of Rs 5 crore from its asset sale, if any, towards its alleged dues to ALT Media.
"Without prejudice to the rights and contentions of the parties, the
respondent is directed to retain a sum of Rs 5,00,00,000 towards the
claims of the petitioner from the sale of assets if any till next date," the order said. The case is now expected to come up for hearing on July 15.
ALT filed a plea under Section 9 of the Arbitration and Conciliation Act, 1996, seeking an interim relief before it could start arbitral proceedings against MX.
Earlier this month, it was reported that Amazon signed an agreement to acquire some assets from the Times Internet-owned streaming platform MX Player, hinting at consolidation in India's increasingly competitive video streaming market.
It maybe noted that Sony had filed a similar plea against MX media in May and had obtained an identical order.
During the course of the hearing, senior advocate Sandeep Sethi, who appeared for ALT, contended that they have moved a plea to protect their interest as MX media looks to sell its assets. According to Sethi, MX admitted its liability towards ALT. He contended that the parties had entered into an agreement for producing some content in which the cost was to be split between ALT and MX. However, MX did not pay Rs 5 crore for over two years. Sethi also argued that ALT had filed the plea as the negotiations between the parties had come to halt.
According to ALT, they came to know that DIVX had filed an application for insolvency against MX Media in the Singapore High Court seeking winding up of the company. While the court had ordered winding up of the company, a higher bench, however, stayed the order for six weeks. According to ALT, the stay order will come to an end on June 20, after which the winding up will proceed as usual.
ALT moved the court as the Singapore entity has acted for each other,
and undertaken and performed each other's obligations as a single
economic entity (in the Singapore proceedings).
However, MX, represented by senior advocate Akhil Sibal, contested the media company's claim and contended that it was ALT that owes money to MX player. He argued that Sony's case was different from that of ALT's as MX player had admitted debt with the former. According to Sibal, ALT waited for two years before filing the plea after Amazon's asset acquisition plans surfaced.
The court, however, said that ALT might not have moved the court as they were in negotiation with MX.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
