Oyo Rooms, the budget hotel aggregator which claimed to have achieved profitable unit economics last month, has now reportedly landed into legal trouble. Noesis Capital Advisors has filed a case against the company for failing to make a payment.

Noesis Capital Advisors, a Mumbai-based advisory firm, has filed a winding-up petition against Oravel Stays in Delhi High Court on 26th April this year, claims Economic Times. Oravel Travels is the parent company that owns and operates OYO Rooms.

The winding-up petition is filed by the company in order to recover dues by forcing an insolvent company into compulsory liquidation. As per the report from ET, the hospitality advisory firm has claimed that OYO Rooms has failed to make the payment of Rs 1,50,39,575 despite using their services during the scaling-up phase of the venture.

Noesis Capital Advisors’ spokesperson said,

OYO availed services of Noesis through an exclusive, noncompete contract. Mid-way through the term of the agreement, we found evidence that Noesis was in breach of agreement and terminated their services. We also sent them a legal notice to recover dues paid in good faith. That matter is presently sub-judice.

Mumbai based Noesis Capital Advisors is into hospitality advisory and helps with entry strategy, site selection, feasibility and equity finance. The firm offers services across a wide range of hospitality, retaining the specialist skills, attention to detail, and quality of service.

Oyo Rooms, one of the fastest growing startup in India, and one of the largest in the hospitality sector, has been on an expansion spree. In order to strengthen its position in the market, it also acquired its rival Zo Rooms earlier this year.

Till now, the budget hotel chain has raised more than $225.6 million in 5 rounds of funding from 7 investors. Most recently, the company raised $100 million from SoftBank and Sequoia Capital.

Earlier, Oyo Rooms had filed a case against Zo Rooms for allegedly copying data and confidential information during the setup and launch of the venture. The Delhi High Court had issued stay order against Zo Rooms. However, Oyo Rooms ultimately ended up acquiring the company.

Other big legal battles that we have witnessed include, Uber who dragged Ola to court accusing it of dirty tricks including making false bookings on its platform by setting up “fake rider accounts” and misleading its drivers through “fake calls” impersonating Uber. A couple of months ago, Jugnoo also filed a case against Ola accusing it of unethical business practices.

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