Dr. Sanjeiiv Geeta Chaudhry vs Lytus Technologies Private Limited

Dr. Sanjeiiv Geeta Chaudhry ...Appellant

Versus

Lytus Technologies Pvt. Ltd. ...Respondent

Present:

For Appellant: Mr. Rishabh Sancheti, Ms. Pratiksha Sharma, Mr. Ankit Acharya, Ms. Ritu Chaudhary, Mr. Ayush Jain, Mr. Mukesh Kumar, Mr. Nishant Kumar, Advocates. For Respondents: Mr. Amar Dave, Sr. Advocate with Mr. Shivam Shukla, Mr. Kaustabh Singh, Advocates.

JUDGMENT

(10th December, 2025)

Ashok Bhushan, J.

This Appeal has been filed challenging the order dated 26.06.2025

passed by the Adjudicating Authority (National Company Law Tribunal)

Mumbai Bench, Court-I rejecting Section 9 application filed by the Appellant

an Operational Creditor.

2. Brief facts necessary to be noticed for deciding the Appeal are:-

2.1. An Employment Agreement dated 24.08.2020 was entered between the

Appellant and Lytus Technologies Private Limited, the Respondent No.1 2

appointing the Appellant as Chief Mentor and Chief Executive Officer Tele-

Health (India) w.e.f 01.09.2020. The Employment Agreement contemplated

base salary of USD 280,000/- per year. It also mentioned that Appellant may

be eligible to receive a semi-annual discretionary bonus and some employee

benefits. The holding company of the Respondent- Lytus Technologies Private

Limited is Lytus Technologies Holding Pvt. Ltd. which was incorporated at

British Virgin Islands. An offer of appointment dated 27.01.2021 was given by

the holding company to the applicant as an Independent Director in the Board

of holding company. The offer dated 27.01.2021 given by the holding company

to the Appellant was accepted by the Appellant on 27.01.2021. A declaration

dated 08.05.2021 was filled by the Appellant which information was requested

by a questionnaire for record of the holding company in connection with

preparation by the company of registration statement in Form F-1 with the

proposed initial public opinion (Registration Statement). In the questionnaire

filled by the Appellant, he claimed his appointment as an Independent Director

of the holding company w.e.f. 27.01.2021.

2.2. After completion of the necessary formalities, the holding company was

under the United States Securities and Exchange Commission order. After

necessary filing by the holding company, the holding company became a listed

company w.e.f. 14.06.2022. In the necessary filing by the holding company

w.e.f. 14.06.2022, the Appellant was shown as Independent Director in the

Board of Director of the holding company. Appellant after being shown as

Independent Director claim to have issued e-mail w.e.f. 11.07.2022 to

Company Appeal (AT) (Insolvency) No.1386 of 2025 3

14.05.2023 regarding non-receipt of promise compensation as per the

Employment Agreement. An e-mail dated 06.07.2023 was sent by the

Operational Creditor to the Corporate Debtor requesting for outstanding salary

payment. Reply to the e-mail was also sent. There has been certain exchange of

WhatsApp messages between Appellant and Dharmesh Pandya of the

Corporate Debtor. On 15.07.2023, Appellant gave a legal notice to the

Corporate Debtor as well as holding company demanding from Corporate

Debtor an amount of USD 1,008,330.33/- as arrears of payment of salary. In

the legal notice, apart from arrears of salary, certain demands were made from

allocation of shares from the holding company. The legal notice was replied by

letter dated 26.07.2023 refuting the claim raised by the Appellant in the legal

notice. The reply to legal notice stated that after the Employment Agreement,

Appellant neither provided any services nor carried out any activities. It was

further stated that w.e.f. 27.01.2021 when the Appellant accepted the

employment of Independent Director in the holding company, his employment

stood termination w.e.f 27.01.2021. It is stated that Appellant has abandoned

his employment in the Corporate Debtor and has never been paid any salary by

the Corporate Debtor. Various other statements were made in the reply to the

legal notice refuting the claim of the Appellant. Appellant issued a demand

notice dated 03.10.2023 under Section 8 of the IBC claiming default of

operational debt of Rs.16,43,83,469.88. Consequent to Employment Agreement

dated 24.08.2020, date of default was mentioned as 30.09.2020. The above

date included accrued salary post, IPO bonus, stock allowance etc. The

Company Appeal (AT) (Insolvency) No.1386 of 2025 4

demand notice was replied by the Corporate Debtor vide reply dated

12.10.2023. in the reply to demand notice the claim of the Appellant was

refuted. Reply to demand notice stated that Appellant has accepted

directorship in the holding company which is publicly listed company on

NASDAQ as a foreign filler and is governed by laws of British Virgin Islands and

the Corporate Debtor is wholly owned subsidiary of the holding company. Reply

notice further pleaded that Appellant accepted appointment as Independent

Director on 27.01.2021 in the holding company. Independent Director cannot

be employee of company or its subsidiary. It was pleaded that nothing is

payable to Appellant and he is not the employee of corporate debtor. The reply

to demand notice captured other disputes with the claim of the Appellant. After

receiving the reply to the demand notice, Appellant filed Section 9 application

being CP(IB) No.1033(MB)2024 claiming total amount of Rs.16,43,83,469.88.

As per the Employment Agreement dated 24.08.2020 which salary was claimed

from September 2020 to September 2023. With regard to date of default of

salary, different dates from September 2020 to September 2023 were

mentioned. Section 9 application was replied by the corporate debtor by filing a

detailed reply to Section 9 application. In reply to Section 9 application,

Corporate Debtor refuted the claim of the Appellant and Adjudicating Authority

after hearing both the parties by impugned order has rejected the application

in view of the existence of dispute prior to issuance of demand notice.

Adjudicating Authority has referred to and relied on the reply dated 26.07.2023

Company Appeal (AT) (Insolvency) No.1386 of 2025 5

given by the Corporate Debtor to the legal notice dated 15.07.2023.

Adjudicating Authority in paragraphs 38 & 39 made following observations:-

"38. The said dispute was communicated to the Applicant even prior to issuance of demand notice dated 03.10.2023 and was again reiterated in the reply dated 12.10.2023 to the demand notice.

39. Admittedly, the Applicant has not placed on record any contemporaneous communications suggesting rendition of employment services to the Corporate Debtor during the period for which the claim has been made out. Further, no evidence has been placed on record whereby the Applicant had followed for payments due on account of his base salary fortnightly from the Corporate Debtor for the period from September 2020 onwards. Instead, the Applicant has contended that he had received certain payments in June and October 2022, however, these payments were made by Lytus BVI and not by the Corporate Debtor. The Applicant has also placed on record certain whatsapp messages to evidence rendition of service, however, such messages are stated to have been exchanged in relation to his engagement with Lytus BVI. It is pertinent to note that the Applicant had joined as an independent Director of Lytus BVI and was entitled to receive compensation for his service on the Board in accordance with the Non-Employee Director Compensation Policy, as may be amended from time to time. There is nothing on record to suggest that the payments received from

Company Appeal (AT) (Insolvency) No.1386 of 2025 6

Lytus BVI in 2022 were under Employment Agreement with the Corporate Debtor. This fact may need further enquiry, which this Tribunal cannot enter into while adjudicating an Application under Section 9 of the IB Code.

Accordingly, the claim for base salary cannot said to be an undisputed claim."

2.3. Challenging the order dismissing Section 9 application, this Appeal has

been filed.

3. We have heard Shri Rishabh Sancheti, Counsel for the Appellant and

Shri Amar Dave, Learned Senior Counsel for the Respondent.

4. Learned Counsel for the Appellant challenging the impugned order

submits that there was debt above statutory threshold legally due to the

Appellant by Corporate Debtor. Corporate Debtor having defaulted in payment

of the said dues, Section 9 application requires admission. It is submitted that

under the Employment Contract dated 24.08.2020, Appellant was entitled for

salary of USD 2,80,000/- per annum payable fortnightly. It is submitted that

the Appellant was appointed Independent Director w.e.f. 14.06.2022 which

date is reflected in the necessary filings by the holding company, hence, dues

from 01.09.2020 to 14.06.2022 surpass the statutory threshold and at no

point of time, the said appointment was terminated. Appellant worked up to

June 2022 before his appointment as Independent Director in holding

company. Regulatory filings of the holding company are inherently

Company Appeal (AT) (Insolvency) No.1386 of 2025 7

contradictory. In the NASDAQ disclosures date of appointment of the

Independent Director of the Appellant is mentioned as 14.06.2022. Thus,

Corporate Debtor was clearly liable to make payment of salary till 14.06.2022.

Appellant was also entitled for the bonus as per the employment contract. The

questionnaire which is relied by the corporate debtor is self-serving document.

The questionnaire and offer of appointment required shareholder approval,

hence, 27.01.2021 cannot be taken as date of actual appointment of Appellant

as Independent Director. All relevant materials were on record the Adjudicating

Authority did not consider the above aspect. The finding has been rendered by

the Adjudicating Authority without considering all relevant materials. It is

submitted that the promoter himself has acknowledged that salary payment is

due to the Appellant. Counsel for the Appellant has referred to e-mail dated

30.05.2023 sent from General Counsel where claim of the Appellant was

admitted for payment of salary. The defence which is sought to be raised by the

Corporate Debtor is a moonshine and non-est defence. The reply to demand

notice and reply to Section 9 application was mere an afterthought and a

moonshine. Appellant has sent several mails from 11.07.2022 onwards

claiming amount due from Corporate Debtor which all have been ignored.

5. Counsel for the Respondent refuting the submissions of the Counsel for

the Appellant submits that the Appellant although was appointed by

Employment Agreement dated 24.08.2020 but in pursuance of the

employment, Appellant did not perform any work. Appellant accepted the offer

given by the holding company on 27.01.2021 to be appointed as Independent

Company Appeal (AT) (Insolvency) No.1386 of 2025 8

Director in the holding company, by acceptance of Independent Director in the

holding company, the Appellant has clearly abandoned prior employment with

the Corporate Debtor. The offer of appointment dated 27.01.2021 was accepted

in writing by the Appellant. The declaration has been filed by the Appellant on

08.05.2021 where prior to employment as Independent Director on 27.01.2021,

no employment was shown in the holding company or its subsidiary. The mere

fact that the holding company could be listed on 14.06.2022 and subsequent

filing of date of appointment is shown as 14.06.2022 cannot be reason to

ignore the own statement made by the Appellant accepting his appointment

w.e.f 27.01.2021. It was only in the year 2022 much after appointment of

Appellant as Independent Director he started writing e-mails for his dues of

salary and other dues. The fact that Appellant claims for appointment w.e.f.

01.09.2020 and for about two years, no request has been made for payment of

salary speaks for itself. Appellant having not performed any work had

abandoned his appointment and has accepted the appointment of Independent

Director for which he has made declaration in writing, Appellant cannot be

allowed to resile from his own statement. More so, much before the issuance of

demand notice, on 03.10.2023, legal notice dated 15.07.2023 was issued by

the Appellant claiming the same amount which was refuted by reply dated

26.07.2023. In reply dated 26.07.2023, detailed reasons were given by the

Corporate Debtor disputing the claim of the Appellant. Thus, there was pre-

existing dispute between the parties much before issuance of demand notice,

hence the Adjudicating Authority has rightly dismissed the application relying

Company Appeal (AT) (Insolvency) No.1386 of 2025 9

on pre-existing dispute. The submission of the Appellant that defence raised by

the Corporate Debtor refuting the claim of the Appellant is a moonshine

defence and is an afterthought cannot be accepted. Appellant having accepted

offer of the Independent Director given by the holding company on 27.01.2021,

he could not continue in the employment of the corporate debtor to which

Appellant was well aware. Due to this reason, no claim was raised of any salary

for about two years and only after July 2022 when there was some dispute in

the holding company also Appellant started raising claim of arrears of salary.

The share of holding company was allotted in the name of wife of the Appellant

in October 2020.

6. We have considered the submissions of the Counsel for the parties and

perused the record.

7. The Hon'ble Supreme Court in "Mobilox Innovations Private Limited

vs. Kirusa Software Private Limited- (2018) 1 SCC 353" has elaborately

dealt with the jurisdiction of the Adjudicating Authority while considering an

application under Section 9. In paragraph 51 of the judgment, Hon'ble

Supreme Court laid down following:-

"51. It is clear, therefore, that once the operational creditor has filed an application, which is otherwise complete, the adjudicating authority must reject the application under Section 9(5)(i)(d) if notice of dispute has been received by the operational creditor or there is a record of dispute in the information utility. It is

Company Appeal (AT) (Insolvency) No.1386 of 2025 10

clear that such notice must bring to the notice of the operational creditor the "existence" of a dispute or the fact that a suit or arbitration proceeding relating to a dispute is pending between the parties. Therefore, all that the adjudicating authority is to see at this stage is whether there is a plausible contention which requires further investigation and that the "dispute" is not a patently feeble legal argument or an assertion of fact unsupported by evidence. It is important to separate the grain from the chaff and to reject a spurious defence which is mere bluster. However, in doing so, the Court does not need to be satisfied that the defence is likely to succeed. The Court does not at this stage examine the merits of the dispute except to the extent indicated above. So long as a dispute truly exists in fact and is not spurious, hypothetical or illusory, the adjudicating authority has to reject the application."

8. It was clearly held by the Hon'ble Supreme Court that if notice of dispute

has been received by the operational creditor, the application is to be rejected.

The Hon'ble Supreme Court, however, further held that the adjudicating

authority is to see at this stage is whether there is a plausible contention which

requires further investigation and that the "dispute" is not a patently feeble

legal argument or an assertion of fact unsupported by evidence.

9. We have to examine the facts and pleadings in the present case in light of

the ratio of the judgment of the Hon'ble Supreme Court. As noticed above, one

of the dispute which exists between the parties is as to the date of appointment

Company Appeal (AT) (Insolvency) No.1386 of 2025 11

of Appellant as Independent Director in the holding company. The case of the

Corporate Debtor is that offer of appointment was given on 27.01.2021 which

was accepted by the Appellant on the same day, hence, Appellant will be

treated to be an Independent Director w.e.f. 27.01.2021. It is further submitted

by the Corporate Debtor that the Appellant has filed a declaration in form of

questionnaire on 08.05.2020 where he has shown his date of appointment as

27.01.2021 and further he has declared that he has not in any employment of

any subsidiary company of the holding also. Thus, Appellant has abandoned

his claim of appointment in the Corporate Debtor which is clear from the

declaration made. The above submission of the Corporate Debtor is supported

by the document which has been brought on the record by the Appellant

himself by means of additional affidavit. In the additional affidavit at page 21,

the copy of the offer letter dated 27.01.2021 issued by the holding company to

the Appellant for appointment as Independent Director has been brought on

record which is signed and accepted on 27.01.2021 by the Appellant. The

declaration dated 08.05.2020 filled by the Appellant has been brought on

record. Learned Counsel has referred to declaration signed by the Appellant

dated 08.05.2020 where under Clause 5 'business experience' (b) as to whether

the Appellant was employed by the company or a subsidiary of the company

where Appellant has answered as 'not applicable'. Clause 5(b) is as follows:-

"(b) If you are an Executive Officer of the Company and have been employed by the Company or a subsidiary of the Company for less than five (5)

Company Appeal (AT) (Insolvency) No.1386 of 2025 12

years, briefly explain the nature of your responsibilities in positions held prior to employment with the Company or its subsidiaries.

In order to provide adequate disclosure of your prior business experience, please provide information relating to the level of your professional competence, which may include, depending on the circumstances, such specific information as the size of the operation supervised.

Answer:

Not applicable"

10. It is also relevant to notice another declaration under the heading in

clause 2 'Positions and Offices'. Clause 2(a) is as follows:-

"2. Positions and Offices

(a) Please state all positions and offices you presently hold or have held with the Company or any of its subsidiaries, the nature of your responsibilities, your term or office and the periods of your service. (Reg. S-K-

Items 401(a) & (b)) Answer:

Position Date of Expiration of Period Served or Office Term

Director From 27 Jan 2021 till 4 months cessation by either sides

11. The above declaration which is signed by the Appellant itself indicate

that the Appellant claimed him to be working as director in the holding

Company Appeal (AT) (Insolvency) No.1386 of 2025 13

company from 27.01.2021 and has not shown his employment in the company

or agreement or subsidiary in last three years.

12. Thus, the contention raised by the Corporate Debtor that Appellant was

in employment of holding company as Independent Director w.e.f. 27.01.2021

cannot be said to be an afterthought as moonshine dispute. On the other hand,

counsel for the Appellant has relied on filing of the holding company, which is

a listed company before the NASDAQ where date of appointment of the

Appellant was shown as 14.06.2022. Counsel for the Appellant has referred to

the documents brought on record along with IA No.5679 of 2025 to take

additional document which contains filing on 04.05.2022 with the Security and

Exchange Commission of United States. The above record indicates that the

date of appointment in the filling by holding company for the Security and

Exchange Commission of United States refers to 14.06.2022. As noted above,

the above dates of appointment of the Appellant as contended by both the

parties are bone of contention between the parties. We only observe that the

contention raised by both the parties raises dispute which cannot be said an

afterthought and moonshine.

13. As noted above, the demand notice under Section 8 has been issued by

the Corporate Debtor on 03.10.2023. prior to demand notice, Appellant has

issued a legal notice dated 15.07.2023 both to the Corporate Debtor and

holding company where an amount of 1,08,330.33 USD has been claimed from

arrears of Corporate Debtor. The said demand notice claiming salary from

Company Appeal (AT) (Insolvency) No.1386 of 2025 14

September 2020 with the Corporate Debtor as Chief Mentor and Chief

Executive Officer. Demand notice in detail claimed was arrears of salary from

01.09.2020 and other dues which demand notice was immediately replied and

refuted by letter dated 26.07.2023 on behalf of the Corporate Debtor and the

holding company. In the reply to demand notice, in paragraphs 5 to 8,

following has been stated:-

"5. However, despite entering into the Employment Agreement, your client did not fulfil any of the obligations expected of him from his role. He neither provided any services nor carried out any activities and did not even prepare a business plan. Thus, although on paper he was employed with Lytus India in the above-mentioned role with effect from 01-09- 2020, your client never actually worked for Lytus India or provided any services to Lytus India and thus did not fulfill his obligations under the Employment Agreement and therefore is not legally entitled to claim his salary dues.

6. Without prejudice to the above, your client had, on 27-01-2021 accepted his appointment as an Independent Director on the board of Lytus BVI vide an Offer Letter from Lytus BVI ("Offer Letter"). Further, the board resolution dated 14-06-2022, was also ratified by your client on 27-07-2022, and thus he categorically had accepted that he had no other role in the Lytus BVI or its subsidiaries and that he satisfied the Independent Director Eligibility criteria of the NASDAQ Listing Rules. Your client had

Company Appeal (AT) (Insolvency) No.1386 of 2025 15

represented to the Board as far back as in May 2021 that he was an independent director of the Lytus BVI and had no other relationship with the Lytus BVI or its subsidiaries.

7. NASDAQ Rule No. 5605 explicitly states that an Independent Director cannot be an employee of the Company for its subsidiary) in which he is appointed an Independent Director. Thus, your client was aware and had full knowledge of that the fact that it was not possible for him to simultaneously hold the position of an employee of Lytus India while also being an independent director of Lytus BVI and had acknowledged the same via Email communications with officers of my clients. The Employment Agreement entered into by your Client with Lytus India explicitly stated that the same was subject to applicable laws. Thus, your client ceased to be an employee of Lytus India the day he accepted his appointment as an Independent Director with Lytus BVI.

8. Thus, even assuming for the sake of argument that your client was actually employed with Lytus India, the said employment stood terminated as of 27-01- 2021 when your client accepted the Independent Directorship of Lytus BVI."

14. The reply to the legal notice clearly has stated in detail the case of the

Corporate Debtor and has categorically refuted any entitlement of any arrear of

salary by the Appellant. Each and every claim was refuted by giving relevant

details as noticed above. In paragraph 16 again with respect to case set up by

Company Appeal (AT) (Insolvency) No.1386 of 2025 16

the Appellant in the legal notice detailed reply was given. Paragraph 16 is as

follows:-

"16. I shall now deal with the contentions raised by you paragraph wise.

a. With reference to paragraph 1,admittedly your client was appointed as an Independent Director of Lytus BVI on 27-01-2021. By virtue of that appointment, the role of your client in Lytus India stood terminated. With reference to your client's qualifications and expertise, the same is denied and you are put to strict proof thereof.

b. With reference to paragraph 2, admittedly your client entered into the Employment Agreement. However, your client never performed any of his obligations under the agreement and had suppressed crucial facts from my clients prior to entering into the same. In any case, the same stood terminated from 27-01-2021 by virtue of your client accepting his appointment as an Independent Director of Lytus BVL. With reference to the terms of the employment Agreement. those are mentioned in the Agreement itself and are a matter of record. It is denied that an IPO Bonus of USD 250,000 and a stock allowance of USD 500,000 was payable by my client as per the Employment Agreement.

c. With reference to paragraph 3, the issue of the allotment of shares has already been dealt with in paragraphs hereinabove. It is explicitly denied that any stock allocation is required to be corrected by my clients.

Company Appeal (AT) (Insolvency) No.1386 of 2025 17

d. With reference to paragraph 4, it is denied that Lytus India has failed to honour its contractual obligation to remit the stipulated salary to your client. e. With reference to paragraph 5, it is denied that the letter dated 27-01-2021 was an offer for an opportunity as independent director, since the same would be in violation of law, f. With reference to paragraph 6, his appointment was accepted on 27-01-2021, however, his appointment was to be effective upon closing of the initial offering. g. With reference to paragraph 7. it is denied that Lytus BVI and Lytus India have neglected any legal obligation that was due to your client.

h. With reference to paragraph 8, it is denied that any amount is due as mentioned in the paragraph. It is denied that there are any arrears in salary payments and shortfall in the value of the allotted shares. i. With reference to paragraph 9, it is denied that my clients have willfully failed to remit any outstanding salary that is due or address any shortfall of shares that is legally due. It is denied that my clients have delayed or evaded any contractual obligations to your client.

j. With reference to paragraph 10, 11 and 12, our client's Chief Financial Officer had already sought your client's presence over a Zoom call or telephone and by inviting him to Mumbai when Mr. Dharmesh Pandya was in Mumbai through several reminders by email and Whatsapp to understand the various issues raised by your client, but your client choose not to respond to any of those reminders and instead chose to make personal

Company Appeal (AT) (Insolvency) No.1386 of 2025 18

accusations against Mr. Dharmesh Pandya and directly sent the Legal Notice on 15th July 2023. This clearly indicates your client's malafide intentions to malign the reputation of my clients.

k. With reference to paragraph 13, it is denied that my clients have accepted and benefitted from your client's engagement and services in any manner. My clients deny that there has never been any indication from my clients that there have been deficiencies in the services provided by your client

1. With reference to paragraph 14, my Clients deny that they have committed any breach of propriety or cheating under the listing laws of the NASDAQ and the SEC of the United States. It is denied that there is any misconduct on the part of my clients that undermines the integrity of financial markets and violates the trust placed in corporate entities operating in those jurisdictions.

m. With reference to paragraph 15, it is denied that there are any outstanding payments or shares due to your client. It is denied that any financial injustices have been caused to your client.

n. With reference to paragraph 16, the claims therein are denied as per the contentions raised hereinabove. o. With reference to paragraph 17, it is denied that your client has any legal basis for initiating any proceedings, civil or criminal, in any jurisdiction."

15. From the above, it is clear that much before issuance of demand notice,

the claim of the Appellant was refuted in writing by giving a reply dated

Company Appeal (AT) (Insolvency) No.1386 of 2025 19

26.07.2023. The demand notice was issued on 03.10.2023 to which reply was

given on 12.10.2023 again refuting the claim of the Appellant and reiterating

the facts of the case in detail. The reply to demand notice dated 12.10.2023 is

clearly a notice of dispute within the meaning of Section 9 (5)(ii)(d). As noted

above, much before the issuance of demand notice, the claim of the Appellant

was refuted by letter dated 26.07.2023 relevant extract of the said reply we

have already extracted above. Thus, present was a case of pre-existing dispute

and the Adjudicating Authority has rightly dismissed the application, coming to

the conclusion that there is pre-existing dispute between the parties. Pre-

existing dispute between the parties clearly reflected which we have noticed

above and the defence raised by the Appellant cannot be said to be moonshine

defence or defence unsupported by any evidence. The fact that from September

2020 till July 2022 not a single e-mail or demand has been made by the

Appellant for payment of its salary by the Corporate Debtor speaks for itself.

Counsel for the Appellant has contended that in fact, in email which was

issued on behalf of the Corporate Debtor, the payment of salary claim was

admitted and on behalf of the Corporate Debtor, it was agreed that arrears are

due. Learned Counsel for the Appellant has referred to e-mail dated 30.05.2023

issued to the Appellant which e-mail has been brought on the record as

Annexure 1 to IA No.5679 of 2025. To appreciate the submission of the

Appellant, we need to notice the e-mail in full which is as follows:-

"From: hanish talsania Date: May 30, 2023 at 8:19:48 PM GMT+5:30 To: Sanjeiiv Chaudhry

Company Appeal (AT) (Insolvency) No.1386 of 2025 20

Cc: Dharmesh Pandya , Nimish Pandya , Shreyas Shah Subject: Re: Lytus Sanjeiiv Accruals Account

Dear Mr. Sanjeiiv,

I have been instructed by the Management to take charge of this discussion with respect to the various claims that you have put forth to Shreyas the CFO of the Company. In my capacity as the GC, I have had inputs from the lawyers in the US, the auditors and Dharmesh as CEO and I wish to put the entire subject in perspective.

At the outset, you can rest assured that we are trying our best within the contract as to how your claims can be considered by the Management and which is the best way to resolve the same.

I understand from the Management that you were issued a Letter of Appointment on 24 Aug. 2020 on an annual salary of USD 280,000. It was also clarified in the said letter that the said salary would be periodically reviewed as a part of regular review of the management. This employment was categorically at will. Thereafter, the Company got listed in June 2022 however, on 27 Jan. 2021 you had accepted to be an independent director on the Board for a stock compensation of USD 75,000.

As you are aware, I had by my email dated 18th January 2023 advised the Board, including you that once having accepted to be an independent director on the Board, it was legally not tenable for the employment contract to continue. In light of the above, the Management has proposed the following resolution plan to your request.

Company Appeal (AT) (Insolvency) No.1386 of 2025 21

1. Salary from September 2020 to February 2021 USD 116,666.67 less USD 35,000 already paid to you in cash. Hence, the balance amount due is USD 81,666.67.

2. With respect to USD 250,000 IPO bonus, the same is a function of an employment contract and independent directors cannot be granted the same. Additionally, you as an independent director are aware that no such IPO bonus has been declared by the Board and paid to any of the Directors of the Board.

3. Stock compensation for Independent Directorship will be issued to you for the value of USD 75,000 at the current stock price which the Management believes will address the point in your excel sheet relating to deficiency in value of the shares (already allotted to Mrs. Shaila Chaudhry). This is notwithstanding the fact that the Company had allotted shares to you at USD 13 which is a closed contract and the Company cannot be subject to the vagaries of the Stock Market. In any case, recalibration cannot be permitted from an accounting and legal perspective.

I understand that you are planning to come down to Mumbai to meet in person or get on a call sometime this week to discuss and close this with the Management. I would be happy to answer any questions that you may have.

Thank you, Hanish."

16. When we look into the aforesaid e-mail, it was clearly mentioned that the

Appellant accepted as Independent Director in holding company w.e.f

27.01.2021. The e-mail only forward the proposal for resolution and according

Company Appeal (AT) (Insolvency) No.1386 of 2025 22

to the e-mail, the amount balance is 81,666.67 USD. The other claim of bonus

or stock compensation has been clearly denied. The above e-mail indicates a

clear proposal for resolution and salary from September 2020 to February 2021

which was computed, cannot be any foundation for Section 9 application due

to two reasons. Firstly, the amount which was offered in the above resolution

plan was 81,666.67 USD which does not meet threshold and as per Part IV of

the application under Section 7 filed by the Appellant, the default of salary

during the period September 2020 to February 2021. In Part-IV Column 2, the

amount claim and date of default has been mentioned by the Appellant itself. It

is useful to notice Part IV Col.2 which is as follows:-

2. AMOUNT CLAIMED TO BE Amount claimed to be in default: INR IN DEFAULT AND THE 16,43,83,469.88 (Rupees Sixteen Crore DATE ON WHICH THE Forty Three Lacs Eighty-Three Thousand DEFAULT OCCURRED Four Hundred and Sixty-Nine Eight Eight (ATTACH THE WORKING Only) FOR THE COMPUTATION Date on which the default occurred:

OF THE AMOUNT AND A. Base Salary THE DATES OF DEFAULT Dates of Amount of Amount of Default Default Default IN TABULAR FORM) (USD) (INR) Sep 2020 23,333.33 19,37,561 Oct 2020 23,333.33 19,37,561 Nov 2020 23,333.33 19,37,561 Dec 2020 23,333.33 19,37,561 Jan 2021 23,333.33 19,37,561 Feb 2021 23,333.33 19,37,561 Mar 2021 23,333.33 19,37,561 Apr 2021 23,333.33 19,37,561 May 2021 23,333.33 19,37,561 Jun 2021 23,333.33 19,37,561

Company Appeal (AT) (Insolvency) No.1386 of 2025 23

Jul2021 23,333.33 19,37,561 Aug 2021 23,333.33 19,37,561 Sep 2021 23,333.33 19,37,561 Oct 2021 23,333.33 19,37,561 Nov 2021 23,333.33 19,37,561 Dec 2021 23,333.33 19,37,561 Jan 2022 23,333.33 19,37,561 Feb 2022 23,333.33 19,37,561 Mar 2022 23,333.33 19,37,561 Apr 2022 23,333.33 19,37,561 May 2022 23,333.33 19,37,561 June 2022 23,333.33 19,37,561 July 2022 3,333.33 2,76,766.39 Aug 2022 23,333.33 19,37,561 Sep 2022 23,333.33 19,37,561 Oct 2022 8,333.33 6,91,916.39 Nov 2022 23,333.33 19,37,561 Dec 2022 23,333.33 19,37,561 Jan 2023 23,333.33 19,37,561 Feb 2023 23,333.33 19,37,561 Mar 2023 23,333.33 19,37,561 Apr 2023 23,333.33 19,37,561 May 2023 23,333.33 19,37,561 Jun 2023 23,333.33 19,37,561 Jul 2023 23,333.33 19,37,561 Aug 2023 23,333.33 19,37,561 Sep 2023 23,333.33 19,37,561 Total 6,87,84,799 88,28,333.33 .72

B. IPO Bonus Further, IPO Bonus fell due on 30 June 2022 for USD 250,000 (US Dollars Two Hundred and Fifty Thousand Only).

C. Stock Allowance Stock Allowance of USD 392,310.00/- (US Dollars Three Hundred Ninety-Two Thousand Three Hundred Ten Only) continues to fall due and payable.

Company Appeal (AT) (Insolvency) No.1386 of 2025 24

17. The above dates of default from September 2020 to February 2021 for

which the e-mail can be said to be offering Resolution Plan falls within the

period under Section 10A and no application under Section 9 can be filed for

the default of the above salary. The above e-mail does not admit any claim of

the Appellant beyond February 2021. Thus, the submission of the Appellant

that the claim of the Appellant has been admitted by Corporate Debtor cannot

be accepted. We, thus, are of the view that there being pre-existing dispute

between the parties. Adjudicating Authority has rightly dismissed the

application under Section 9. No grounds have been made out to interfere with

the impugned order in this Appeal.

18. The Appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical) New Delhi Anjali

Company Appeal (AT) (Insolvency) No.1386 of 2025