The National Company Law Appellate Tribunal on Thursday denied a petition filed by Vikram Bakshi, estranged partner of McDonald’s India, for interim relief from the termination of the franchise agreement by the international fast-food chain. The tribunal will hear two appeals in the case involving McDonald’s India and Connaught Plaza Restaurant Limited on September 21.
The main petition in the case was filed by McDonald’s India challenging the NCLT’s order to reinstate Bakshi as managing director of Connaught Plaza Restaurant Limited. On Wednesday, Bakshi had filed a fresh petition seeking to stay the termination notice.
According to the termination notice, Bakshi is not allowed to use the McDonald’s system and its intellectual property. CPRL’s licence to run McDonald’s outlets in North and East India had ended on September 6.
The conflict
On August 21, McDonald’s India had cancelled its license agreement with CPRL. McDonald’s said it had been forced to end the partnership as CPRL had “materially breached terms of the respective franchise agreements relating to the affected restaurants, and failed to remedy the breaches”.
The joint venture between McDonald’s and CRPL first hit a roadblock when Bakshi was ousted in 2013 after McDonald’s voted against his re-election. Bakshi challenged his removal in the tribunal and was reinstated as managing director in July.
The closure of 169 outlets in north and east India could leave thousands of employees jobless. “This will cause widespread damage to the lives of 10,000 Indians, the company, the suppliers and all business associates,” Bakshi told The Economic Times on Monday.
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