Hero Electric Faces Bankruptcy Proceedings Over Unpaid Dues

The National Company Law Tribunal has initiated insolvency proceedings against Hero Electric due to unpaid dues claimed by Metro Tyres. Despite Hero Electric's defenses, NCLT found no merit in their arguments, leading to the appointment of an Interim Resolution Professional and issuance of a moratorium on the company's assets.

The National Company Law Tribunal (NCLT) has begun insolvency proceedings against Hero Electric, following a plea by operational creditor Metro Tyres over an alleged default of Rs 1.85 crore. The tribunal also appointed Bhoopesh Gupta as Interim Resolution Professional to manage the company after the board's suspension.

Hero Electric's defense, citing a pre-existing dispute with Metro Tyres, was rejected by the Delhi-based NCLT bench. The company had purchased cycle tyres and tubes from Metro Tyres, who raised invoices totaling Rs 3.69 crore between August and December 2022, leaving Rs 1.85 crore unpaid.

The tribunal issued a 16-page order on December 20 declaring a moratorium to protect the company from any legal proceedings, while stating that Hero Electric's claims about product quality issues were unsubstantiated.

(With inputs from agencies.)