Earlier this month, real estate firm Skyblue Buildwell acquired 82.64% stake in HomeShop18.

Atom E-commerce Friday, June 21, 2019 - 19:47

Weeks after Network18 Media and Investments exited from e-commerce and tele-shopping company HomeShop18, several vendors allege that the company has shut shop and has not paid them their dues.

All India Online Vendors Association, which is an organisation of over 3500 online vendors took to Twitter, posting a video of HomeShop18’s office being shut with only security guards. According to the tweet, Homeshop18 has dues of over Rs 200 crore. A seller that TNM spoke to said that he was owed around Rs 30 lakh.

On Thursday, nearly 50-60 sellers have been visiting the HomeShop18 office in Noida, demanding their dues. In videos shared with TNM, several sellers are seen demanding for payments at the office, where only security guards and one person from the company are available. These sellers were promised an update on their payments on Thursday. However, the same executives (who the sellers have named as Manish, Sanjay Sharma and Gurwinder) have now told the sellers that they no longer work with the company. The sellers continue to have no clarity on when their dues will be paid. However, the website is still active and is taking orders.

AIOVA has also written to the Ministry of Corporate Affairs and RBI to look into the matter.

“We have been receiving reports from our members regarding the non-payment of dues by M/s TV18 Home Shopping Network Limited which was part of the Network 18 group of companies. We have also received report that 3 weeks before today, this company was sold to a company by the name of Skyblue Buildwell Pvt Ltd in private offering, this company has no experience in the concerned industry,” the letter states.

The letter also alleges that Homeshop18 collected money from consumers for the goods sold on its platform on behalf of these sellers but has not paid them for the same.

“We therefore request your good office to intervene and conduct investigation into the affairs of the company in public interest. We also request you to stop the sale of the company by its promoters as they may be subject to civil and criminal action due to non-payment of money collected on behalf of vendors,” they said in the letter.

It further added in its letter to RBI, “This act of non-payment is a violation of Payment Settlement Systems Act, 2007 where and its regulations where this company was acting as a payment collecting intermediary. We therefore request your good office to intervene and conduct investigation into the affairs of the company in public interest.”

On June 6, 2019, Network18 Media & Investments informed the stock exchanges that real estate firm Skyblue Buildwell acquired 82.64% stake in HomeShop18 after fresh round of funding. Post this investment, Skyblue becomes the holding company and promoter of TV18 Home Shopping Network (HomeShop18), “Pursuant to new allotment, HomeShop18 has ceased to be an associate of the Company and the Company has become one of the minority shareholders of HomeShop18 with an effective holding of 8.67% in the total share capital,” it said in the filing, further adding that the company is in the process of changing its corporate as well as brand name.

The sellers have questioned why a real estate company would buy an e-commerce entity. According to the MCA website, Skyblue Buildwell Private was incorporated with MCA on November 26, 2008. It is registered in Delhi and is ‘listed in the class of pvt ltd company and classified as Non Govt Company’. It has an authorized share capital of Rs 1 crore and its paid-up capital is Rs 1 crore.

It lists Surendra Lunia and Sunil Batra as its directors. Surendra Lunia, according to his LinkedIn profile is the former CEO of Himachal Futuristic Communications, a company promoted by Mahendra Nahata. According to a Caravan article published in 2016, Skyblue Buildwell is an entity related to Nahata. Nahata and Mukesh Ambani, the promoter of the Network 18 group have had other business dealings too, according to reports.