Bollywood actor Salman Khan has resolved his Rs 7.24 crore dispute with Zerai Fitness Ltd, leading to the withdrawal of his insolvency appeal before the National Company Law Appellate Tribunal (NCLAT). The settlement relates to a trademark license agreement under Khan’s fitness brand, Strong.
Salman Khan settles Rs 7.24 crore Zerai Fitness dispute, withdraws NCLAT appeal
On 6 October, Khan’s legal counsel informed NCLAT that the terms of the consent had been executed. Subsequently, on October 8, the tribunal recorded the consent terms and allowed the actor to withdraw his appeal. The bench, comprising chairperson Justice Ashok Bhushan and technical member Arun Baroka, withdrew the appeal.
The dispute arose from a 2023 agreement between Khan and Jerai Fitness, which allowed the latter to manufacture, market and sell gym equipment under Khan’s trademark. Under this agreement, JERI was obliged to pay a minimum guarantee of Rs 3 crore annually or 3% of net sales, whichever was higher. Khan alleged that Zerai defaulted on invoices amounting to Rs 7.24 crore, which included a one-time settlement payment of Rs 1.63 crore for the period up to March 2023 and royalties for subsequent years.
Jerai Fitness contested these claims, arguing that Khan had failed to meet his obligations under the agreement. The company said Khan did not provide timely approval for the product design and promotional materials and did not attend the launch of its “Proton” series at the Bombay Exhibition Center in November 2023. Jerai said the invoice relied upon by Khan only claimed a publication in 2024 after a termination notice was issued by the company.
The NCLT Mumbai bench had in May dismissed Khan’s bankruptcy plea, saying that while the settlement amount of Rs 1.63 crore for the earlier period was an undisputed liability, the larger royalty claim was subject to a genuine pre-existing dispute about Khan’s performance under the agreement. The tribunal concluded that the petition fell within the “domain of recovery proceedings” rather than resolution under the Insolvency and Bankruptcy Code (IBC).
Following this dismissal, Khan approached the NCLAT, challenging the decision. However, with the recent settlement and withdrawal of the appeal, the matter has been resolved amicably between the parties.
Khan was represented by advocates Varun Kalra, Parag Khander, Tapan Radkar, and Shaham Ullah from DSK Legal, while Jerai Fitness was represented by advocates Himanshu Satija, Prerna Wagh, Prangana Barau, Pranav Saigal, Harshit Khanduja, Harshit Khaxena, and Ansul Revo.
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