InfoEdge, Rahul Yadav-led 4B Networks enter arbitration over Rs 288 Cr dispute
Delhi High Court directed both parties to an arbitration procedure after the proptech startup failed to provide crucial information to Info Edge.
On Delhi High Court's direction, internet group InfoEdge and Rahul Yadav-led 4B Networks have agreed to appoint an arbitrator to mediate their escalating dispute.
The high court directed both parties to an arbitration procedure after the Yadav-led proptech startup failed to provide crucial information to Info Edge, despite repeated requests, as part of the forensic audit initiated by the investor company last month.
The petition was filed by Info Edge’s subsidiary Allcheckdeals India Private Limited (AIPL), asking the high court for interim measures of protection under Section 9 and Section 37 of the Arbitration and Conciliation Act, InfoEdge said in a filing with BSE.
Both parties jointly proposed former Delhi HC judge Justice Mukta Gupta to act as the sole arbitrator to resolve the dispute between them.
Info Edge had invested Rs 288 crore into 4B Networks, including Rs 276 crore as equity and Rs 12 crore in debt. The parent company has been infusing capital into the Mumbai-based company since February 2021 and acquired a majority (57%) stake in May 2022.
However, 4B Networks failed to furnish detailed updates about the business plan and financial statements despite repeated requests from Info Edge.
The internet group announced in the Q3 FY23 financial results that it wrote off its investments in 4B Networks. It also announced a forensic audit into the proptech startup through its subsidiary, AIPL, and issued a legal notice alleging contractual breaches by 4B Networks and its founder.
The controversial entrepreneur, Rahul Yadav founded 4B Networks to enable real estate developers and brokers to communicate with each other and conduct their business through the broker network platform.
Rahul Yadav has been working in the real estate space for some time. His earlier venture was merged with PropTiger and later left Housing.com in 2015 with a very public spat with the investors including SoftBank.
Edited by Kanishk Singh