BREAKING | NCLAT Upholds NCLT Order, Rejects Actor Akshay Kumar's Insolvency Plea Against Cue Learn

The National Company Law Appellate Tribunal at New Delhi on Friday upheld an NCLT order refusing to start insolvency proceedings against Cue Learn Private Limited over a payment dispute arising from an endorsement deal with actor Akshay Kumar Bhatia.

A coram of Judicial Member Justice N. Seshasayee and Technical Member Indevar Pandey agreed that the disagreement between the parties could not be resolved under the Insolvency and Bankruptcy Code.

The tribunal said insolvency proceedings can be triggered only when debt and default are clear and beyond dispute.

“That the existence of a debt and default, the two fundamental factors which provide a cause for initiating a CIRP, should be beyond doubt or debate,” it said.

The dispute relates to an endorsement agreement signed in March 2021. Cue Learn agreed to pay Rs 8.10 crore plus taxes to the actor for endorsing its platform, with services to be rendered over not more than two days during a two-year term. Half the amount was paid upfront. His services were used for one day. The remaining Rs 4.05 crore was not paid, even after an invoice and a statutory demand notice.

Bhatia argued that the second installment became payable by April 2022 as an independent obligation under the contract, regardless of whether the second day of services was used. Cue Learn disputed this. It said payment was linked to actual performance and mutual scheduling, which never happened. At best, the company argued, the claim was contractual and could only give rise to damages.

The appellate tribunal said the insolvency forum cannot step into the role of a civil court to resolve such disagreements.

“If there are any ambiguities in the material terms of the contract which affect the endeavour of the Adjudicating Authority to gather the real intent of the contracting parties, then the Adjudicating Authority is merely required to identify it but not to iron out the creases for discovering the real intent purported to be conveyed by the terms of the contract,” the Bench observed.

It also noted that while a breach of contract may give rise to a claim, “not every claim will constitute a debt for commencing a CIRP.”

Holding that Cue Learn had raised a plausible pre-existing dispute, the tribunal upheld the NCLT Mumbai's January 2025 order and dismissed the appeal, without costs.