Mumbai: Anil Dhirubhai Ambani Ventures Pvt. Ltd (ADAVL) has filed a fresh interlocutory application in the National Company Law Tribunal (NCLT) seeking the court’s intervention to direct Hinduja Group-owned IndusInd International Holdings Ltd (IIHL) to stop using the brand name ‘Reliance’ once the resolution plan is implemented.
In February, the NCLT had approved IIHL’s acquisition of insolvent Reliance Capital (RCap). According to the order, by approving the resolution plan, the NCLT had permitted IIHL, the successful resolution applicant, to use the brand name, logo, name and trademark owned by, licensed or sub-licensed by, RCap, subject to payment of fees under the existing agreements and subject to the terms and conditions set out in the said agreements for three years for the purpose of implementing the resolution plan.
In its petition, ADAVL has sought the revocation of this part of the court’s order, a copy of which was seen by Mint. The Mumbai bench of the NCLT will hear the matter on Tuesday.
“If the NCLT does not grant the reliefs sought in the petition, serious and irreparable damage, loss and injury will be caused to the petitioner (ADAVL). However, no prejudice will be caused to IIHL or Reliance Capital. The balance of convenience weighs in favour of the petitioner,” the 18-page petition said.
Trademark License Agreement
In 2014, ADAVL and RCap had entered into a brand licensing agreement under which the former had granted RCap a non-exclusive, royalty-free license to use the brand name “Reliance” for 10 years. In June 2021, ADAVL terminated the agreement between the parties, restricting the use of the brand.
In its application, ADAVPL has requested that the trademark agreement should not create any interest in the trademark in favour of RCap but should only permit permissive use of the trademark. In view of this position, the trademark is not an “asset” of RCap within the meaning of the term used in Section 18 of the Insolvency and Bankruptcy Code, and ADAVL has requested cessation of the use of the trademark by IIHL immediately after the implementation of the resolution plan.
It’s not part of the plan
The petition further claims that the company was disregarded for allowing IIHL to use the trademark for three years, as it was not part of the resolution plan.
Currently, IIHL and the lenders that bankrupted RCap are at loggerheads over the implementation of the resolution plan. At its last hearing, IIHL informed the court that it had deposited the equity component of the loan in the bank. ₹2,750 crore in the escrow account designated by the committee of creditors. The NCLT has directed the Reserve Bank of India and the Department for Promotion of Industry and Internal Trade to expedite approval of applications submitted by IIHL for implementation of the resolution plan.
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