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Aviva Life Insurance on Wednesday said the insolvency case filed against the company, in a matter involving commercial dispute of Rs 27 lakh, has been settled.
Earlier this month, the National Company Law Tribunal (NCLT) had ordered to initiate insolvency proceedings against Aviva Life Insurance in a case filed by Apeejay Trust.
Apeejay Trust, which had leased its Mumbai-based (Vashi) premise to Aviva Life Insurance, claimed a default of Rs 27.67 lakh as an operational creditor for not receiving payments towards service tax and license fee for the premises.
"This issue has been fully resolved. Aviva Life Insurance continues to operate as normal. Aviva India has a strong balance sheet and maintains a solvency margin in excess of regulatory requirements.
"We were surprised that a small commercial dispute of Rs 27 lakh led to an insolvency order against us given our ongoing financial strength and such orders would not ordinarily be legally passed against insurers," Aviva Life said in a statement on Wednesday.
Aviva India said the company remains committed to building the business and continuing the strong growth momentum of 30 per cent sales increase that it achieved in second quarter of this fiscal year.
With regard to the case in the NCLT, Apeejay Trust had said the life insurer had not paid license fee, car parking, maintenance/service charge and service tax.
It had made its last payment in this regard on October 5, 2017 and from then the debt was lying due, as per the trust.
However, Aviva had contended that there is an absolute bar under the IBC to initiate any proceedings against insurance companies.
During the proceedings, Aviva had questioned the maintainability of Appeejay Trust's plea on the ground that it is an insurance company and thus being a financial service provider, IBC can not be applied against it.
Aviva Life Insurance Company India Limited is a joint venture between Dabur Invest Corp and Aviva International Holdings Limited, a UK based insurance group.
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