Investment by the way of joint venture in the production and release of the movie ‘Pataakha’ and sharing of revenue generated from the release of the film by all the stakeholders cannot be equated with an Operational Debt u/s 5(21) of IBC – B4U Broadband (India) Pvt. Ltd. Vs. Kyta Productions Pvt. Ltd. – NCLT Mumbai Bench
February 28, 2023
The Corporate Debtor was in contract with the VBLLP with regard to the production and release of the film called ‘‘Pataakha’’. The Corporate Debtor with the consent of VBLLP further entered into an agreement with the Operational Creditor to perform its part of the contract with VBLLP. The former was to make certain investments in the promotion and release of the film along with the Corporate Debtor and after the film was released, the revenue generated from the release of film were to be shared as defined in Revenue Share Clause. The Adjudicating Authority held that in our considered view, the Operational Creditor /Petitioner did not provide any services to the Corporate Debtor. Rather the Petitioner/ Operational Creditor made an investment in the movie and profits were to be shared between the parties after the release of the film.