Most of McDonald's outlets shut in Delhi: NCLAT to hear Vikram Bakshi's stay plea on franchise agreement today

Mail Today Bureau   New Delhi     Last Updated: September 7, 2017  | 13:59 IST
Most of McDonald’s outlets shut in city: NCLT to hear Vikram Bakshi's stay plea on franchise agreement today

Most of the McDonald's outlets in the city remained closed on Wednesday amid a cloud of uncertainty over the chain following the termination of the franchise agreement by the American burger giant for 169 outlets run by Connaught Plaza Restaurants Ltd (CPRL).

The National Company Law Appellate Tribunal (NCLAT) on Wednesday denied any immediate relief to beleaguered Vikram Bakshi on his plea seeking a stay on the termination of the franchise agreement by McDonald's but fixed the hearing of the case for Thursday.

READ ALSO:Why McDonald's four-year-long battle with Vikram Bakshi is a glorious mess

The Mail Today team found that all the McDonald's fast food restaurants were shut in Connaught Place barring one which was still doing business. Similarly another outlet was functioning in South-extension while the one at the airport was also open.

McDonald's had given a 15-day notice period to CPRL, a 50:50 joint venture between the company and its estranged partner Vikram Bakshi, to stop using its brand name, trademarks, designs, branding, operational and marketing practice and policies, and food recipes and specifications. The notice period concluded on Tuesday.

As many as 43 outlets of the fast food chain have been closed already in the Capital since June, following the expiry of the eating house licence which was not renewed amidst the battle royale that has been raging between Bakshi and the US fast-food chain.

Meanwhile, during the day the board of CPRL met with NCLT-appointed administrator Justice G S Singhvi in the chair to decide the future course of action. Bakhsi said, "The appeal before NCLAT is to be heard tomorrow. The administrator on the board of CPRL in the board meeting today has asked both sides to await NCLAT's decision tomorrow.''

A McDonald's India spokesperson said: "We are looking to take steps to exercise our legal and contractual rights to enforce the termination.'' The American burger chain has stated that CPRL was no longer authorised to use the McDonald's system and its intellectual property after the expiry of the termination notice because it has not met certain essential obligations that were a part of the agreement.

"These include the default of payment of royalties to McDonald's for two years. CPRL was notified of the breaches and was provided an opportunity to remedy those but it had failed to do so," the US food chain claims. McDonald's has also stated that it is looking for a new partner to run to replace Bakshi for operating its business in north and east India.

Meanwhile, in another development, Bakshi claimed he has been elected again as Managing Director of CPRL by Justice GS Singhvi. "Whilst the NCLT had restored my position as MD from August 6 2013, in the board meeting today I have been elected as MD again for further period,'' Bakshi said.

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