Essel Group promoted Pan India Network Limited, which distributes online lotteries of various state governments under the ‘Playwin’ brand has defaulted on payment of various dues and loans of operational creditors.
As per the order of the Mumbai bench of the National Company Law Tribunal (NCLT), Pan India Network has defaulted on loans exceeding Rs. 1.60 crores given to it by a private company, Sagar E Shop Private Limited.
Pan India ‘candidly admitted’ its default on payment of loans and inability to pay the same, post which the NCLT on 14th October, 2019 ordered initiation of corporate insolvency resolution process against the Corporate Debtor, Pan India Network Limited.
NCLT also barred any institution of suits against Playwin or alienation of assets, legal rights or beneficial interests by the company until completion of the insolvency resolution process.
As per a notice listed on the Playwin website and also published in newspapers, creditors of the company, including financial creditors were called upon by the interim corporate insolvency resolution professional to submit their claims on or before 28th October, 2019.
Playwin’s website currently states ‘due to technical issues our draws are not configured for selling. We will update you soon.’
It is believed that the 28% Goods and Services Tax (GST) imposed on face value of lottery tickets by the GST Council in 2017, which industry experts believe was unsustainable, resulted in massive decline of sales of private lottery distributors leading to downsizing and shutting down of Playwin’s operations.
The broader crisis in Playwin’s parent Essel Group and inability to fully repay loans and Mutual Fund debt obligations of its group companies also possibly precipitated the crisis for the lottery distributor resulting in its ultimate closure.