The Indian Performing Right Society (IPRS) Ltd has moved the National Company Law Tribunal (NCLT) against Zee Entertainment Enterprises Ltd (ZEEL) — claiming a default of Rs 211.41 crore, the media major said in a regulatory filing.
Zee said it “will be filing its reply rejecting the claim on, inter alia, the ground that there is a pre-existing dispute between the parties on the claimed amount”.
The announcement led to the shares of Zee ending in the red on Tuesday. It settled 1.23 per cent lower at Rs 240.15 on the BSE. IPRS, which is a non-profit society comprising authors, composers and music publishers, had filed an application under Section 9 of the Insolvency and Bankruptcy Code (IBC) 2016, as an operational creditor claiming dues towards royalty payable for the utilisation of “literary and musical works”.
Zee disclosed that the IPRS has filed the petition against the company before the NCLT, Mumbai Bench for the initiation of Corporate Insolvency Resolution Process (CIRP). The company added that the claim is not in “consonance with the interpretation of the law” on the point of payment of royalties for “literary and musical works” by the Delhi high court, and hence, the “claimed amount is not due or payable to IPRS”.
The IPRS authorises use of copyrighted music by issuing licences and it collects royalties on behalf of its members that include authors, composers and the publishers of music. Royalty is then distributed amongst the members after deducting administrative costs.
Last month, IDBI Bank moved the NCLT against Zee seeking to initiate insolvency proceedings against the media firm to recover dues. IDBI Bank has claimed dues of Rs 149.60 crore, which has been disputed by Zee, according to a regulatory update from the media firm.
Zee had earlier announced a merger with Culver Max Entertainment (earlier Sony Pictures Network India) in December 2021.
The merger was approved by the Competition Commission of India in October 2022 with certain conditions. This included the sale of three Hindi channels.
