Stayzilla CEO Yogendra Vasupal’s Bail Petition Dismissed Again, Police Now On Lookout For Cofounder

Things aren’t working out for jailed Stayzilla CEO Yogendra Vasupal.

The courts have again quashed his bail petition, meaning that the entrepreneur will continue to remain in prison. Vasupal, who had been arrested two weeks ago on charges of fraud and not paying dues to his vendors, has now now been sent back to Puzhal jail. The police are now on the lookout for Vasupal’s cofounder Sachit Singhi. Last week, a Special Metropolitan Magistrate court had dismissed his bail petition because his police custody bail petition was pending.

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The latest development is another setback to the Help Yogi movement, which has been lobbying behind the scenes to help out their fellow entrepreneur. As many as 950 entrepreneurs have signed a petition asking Home Minister Rajnath Singh to intervene in the case, which they say is being influenced through political pressure by Stayzilla’s creditors.

Stayzilla’s creditors though contend that it’s a case of cheating. “This is a clear case of breach of trust, the complainant has rendered advertisement services to the accused believing that he would promptly pay the charges, but the accused has exploited the trust of the complainant by cheating him,” City Public Prosecutor M.L. Jegan had said during the last hearing. The counsel for the complainant had also contended that the accused had closed down the registered office of the company in the city. “The Companies Act mandates that every creditor must be duly informed before closing the registered office of a company registered under the Act. But Mr. Vasupal had failed to do so, which clearly establishes his intention to defraud the creditors.”

Vasupal’s lawyer had maintained that the dispute is civil in nature and that criminal cases has been foisted as a pressure tactic. He’d also argued that Stayzilla hadn’t shut down, and was only rebooting its business model. As such, it had plans to pay its creditors, but argued that the entire amount of Rs. 1.69 crore was disputed. He’d said that Stayzilla was willing to pay Rs. 25 lakh within two weeks if Vasupal was released on bail.

Stayzilla had shut down last month after saying that it was finding it hard to compete with bigger players. Vasupal had said that the company was rebooting to a different business model. Two weeks ago, news broke that the Stayzilla had been arrested by the Chennai police. He however, managed to publish a dramatic blogpost from prison, which detailed how Stayzilla’s creditors had been harassing the beleaguered company for their dues. His post had also contained chilling details of voodoo dolls which were sent to his cofounder’s house as a threat by Jigsaw Solutions, an advertising agency that said that Stayzilla owed it Rs. 1.69 crore.

Aditya CS, the proprietor of Jigsaw Solutions, has been vocal about his demands for justice. He’d earlier claimed that startups spend money irresponsibly and then make small companies suffer for their poor business decisions. 

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