Carnival Cinemas is neck-deep in trouble once again. Just as the national multiplex chain was trying to win back the confidence of the trade people, it seems to have hit rock bottom.
Electricity bills of cinemas being run by the group are not being paid, staff salaries remain outstanding for at least two months, GST is being collected by the chain but not being deposited with the government, tax is being deducted at source on payments made but the same is not being deposited, stand-alone cinemas which it had taken over for running, are being forcibly taken over by the owners, and, worst of all, the National Company Law Tribunal (NCLT) has ordered for insolvency proceedings to be started against the chain.
At least four cinemas being run by Carnival have been shut down due to non-payment of electricity charges for months on end. These are TDI, Agra, YNR, Yamunanagar, Palam Vihar, Gurgaon, and Cinemagic, Bikaner. All these cinemas have been forcibly taken possession of by their respective owners after the power supply to them was disconnected due to non-payment of electricity bills. Owners of Funstar cinema in Jaipur took away its possession from Carnival forcibly when the latter failed to pay rent and CAM charges. Carnival’s big properties like the one at Himalaya Mall in Ahmedabad, at Pacific Mall in Delhi, and Odeon in Delhi have been sold to other chains like PVR, Inox and Cineline. It is learnt that a letter of intent for Sangam cinema in Bombay has already been signed with PVR. The multiplex chain’s GST numbers are inactive, implying that what’s being collected by way of GST is not being deposited in the government treasury.
One Lorven International Pvt. Ltd. dragged the group to the NCLT in 2021 as its outstanding dues of Rs. 1.63 crore and interest thereon remained unpaid for interior acoustical and related work done in 2015 in various multiplexes of Carnival in Kerala and at Rewari in Jalandhar. The NCLT on July 8, 2022 passed an order of moratorium from July 8 till completion of the Corporate Insolvency Resolution Process.