NCLT reserves order in BSNL insolvency case filed by Digispice

National Company Law Tribunal, Tuesday, reserved its order in an insolvency petition filed against state-run telecom company Bharat Sanchar Nigam Limited by Digispice Technologies Ltd for a default of Rs 5.41 crore, giving both parties a week to file written submissions.

Digispice claims that the public sector undertaking refused to pay for content and consultancy services provided to BSNL and its customers under the agreement signed between the two parties in 2018.

The counsel for Digispice contended that BSNL had made unreasonable deductions from the final bill amount, without considering Digispice’s view.


BSNL has raised concerns about the bill raised for the services.

“They claim X amount, but the amount payable is X-Y, said BSNL’s counsel.

The BSNL counsel also disputed the argument made by Digispice counsel that the parties had a running account, claiming that the service agreement between BSNL and Digispice doesn’t mention a running account.

“Payment has to be made on a monthly basis, according to the service agreement,” said BSNL’s counsel.

Digispice Technologies initiated insolvency proceedings under Section 9 of the Insolvency and Bankruptcy Code, 2016, against the company on April 17, 2023.

The Digispice Counsel also referred to the Supreme Court judgement allowing for insolvency proceedings to be started against a government company to establish that the service provider was well within its rights to initiate the process against BSNL.

The counsel said insolvency proceedings against a Government company can be initiated as a government company comes under the ambit of Section 3(7) of the Insolvency and Bankruptcy Code, 2016.

The Supreme Court in the Hindustan Construction Company Ltd case in 2019 had clarified that insolvency proceedings could be initiated against government companies or public sector undertakings.