Shares of Coffee Day Enterprises Ltd (CDEL) crashed on the bourses on Monday after IDBI Trusteeship Services filed an insolvency petition with the Bangalore bench of the National Company Law Tribunal (NCLT) for alleged default of Rs 228.45 crore.

The CDEL share ended at Rs 45.34, marking a loss of 14.57 per cent, or Rs 7.73, after tanking more than 18 per cent to a day’s low of 43.35.

This came after the company disclosed in a regulatory filing that an application has been filed against it under Section 7 of the Insolvency and Bankruptcy Code, 2016 read with Rule 4 of the Insolvency and Bankruptcy Rules, 2019 by IDBI Trusteeship Services before the NCLT, Bangalore. Under Section 7 of the Insolvency and Bankruptcy Code (IBC), a financial creditor can get insolvency proceedings initiated against the corporate debtor concerned.

CDEL said it is seeking appropriate legal advice and will take all steps to protect its interest in the dispute.

Last month, the Chennai bench of the National Company Law Appellate Tribunal (NCLAT) stayed the order of the NCLT to initiate insolvency proceedings against Coffee Day Global Ltd (CDGL), which owns and operates the popular Cafe Coffee Day outlets. CDGL is the subsidiary of CDEL.

Passing an interim order, the Chennai bench of the NCLAT had issued notices to the interim resolution professional and its financial creditor IndusInd Bank and stayed the operations of the order passed by the Bangalore bench of the NCLT.

The NCLAT’s order came over a petition filed by Malavika Hegde, the suspended director of CDGL and wife of late V.G. Siddharta. CDEL has been reducing its debt through asset sales.