The National Company Law Tribunal on Monday began proceedings against fast food chain McDonald’s in a contempt plea filed by Vikram Bakshi, the managing director of its estranged Indian partner Connaught Plaza Restaurant Limited.
CPRL is a 50:50 joint venture between Bakshi and McDonald’s India unit. It operates 169 McDonald’s restaurants in North and East India.
The tribunal asked the American company to respond to the plea by January 30, Mint reported. It will hear the matter next on February 7.
Bakshi and McDonald’s have been engaged in a legal battle for months, which has affected operations of its outlets. On August 21, 2017, McDonald’s India cancelled its license agreement with CPRL, accusing it of “materially breach[ing] terms” of franchise agreements.
In his contempt plea filed within a month, Bakshi alleged that the cancellation of the agreement was against an order by NCLT in July 2017, which had asked McDonald’s to not interfere in the functioning of outlets run by CPRL. Following this, the NCLT issued McDonald’s a show-cause notice.
McDonald’s India then moved the Delhi High Court against the show-cause notice. The high court ordered a stay on the notice in November, and earlier this month, dismissed McDonald’s India’s appeal, paving the way for NCLT to restart hearing in the matter.
The joint venture between McDonald’s and CPRL first hit a roadblock when Bakshi was ousted in 2013 after McDonald’s voted against his re-election as managing director. Bakshi challenged his removal in the company law tribunal and was reinstated in the post in July 2017.
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