Shripal Morakhia, the founder and former promoter of gaming startup Smaaash Entertainment, has reportedly accused the company’s resolution professional of professional misconduct and employee harassment (RP).
According to a Mint report, Morakhia claimed in emails that 82 employees resigned this month (March) due to the alleged harassment, which included the filing of multiple legal cases against the employees.
Morakhia, a film director and producer, founded Smaaash in 2012 as a gaming arcade operator with multiple digital entertainment centres for football, cricket, go-karting, and other recreational activities.
Smaaash was reported to be bankrupt in 2020 after being subjected to multiple Covid-19-induced lockdowns. Smaaash was second in total funds raised after Nazara Technologies before the startups shut down for 18 months.
However, once the pandemic-related restrictions were lifted, the startup’s revenue began to rise. The National Company Law Tribunal (NCLT) admitted the Sachin Tendulkar-backed company to insolvency in May 2022 following a default of INR 292 Cr to Edelweiss Asset Reconstruction Company. Bhrugesh Amin was appointed as the startup’s RP.
According to the publication, Morakhia has also raised allegations of other corporate governance issues in the company, in addition to employee harassment. He alleged that Smaaash’s CEO Shirish Kotmire conspired with Amin to get significant pay hikes.
Morakhia has also claimed that Amin has been misusing the firm’s cash flows, and that despite repeated requests for a meeting with the lenders and the RP, he has received no response from the company.
Smaaash currently has a presence in over 20 Indian cities, including Bengaluru, Mumbai, Hyderabad, Delhi-NCR, Madurai, and Siliguri.