Some corporate disputes fade quietly. This one keeps finding new rounds to fight. Zostel has withdrawn its latest application before the Delhi High Court in its long-running battle with PRISM, the parent entity behind OYO, marking yet another twist in a case that has now stretched well over a decade.
The court took up the application on Monday, August 10, and allowed Zostel to withdraw it while keeping the door open to refile later. It also declined to step into a separate complaint Zostel has filed with the Securities and Exchange Board of India. The withdrawal followed a brief hiccup the week before, when Zostel's earlier legal counsel told the court that outstanding fees hadn't been paid, prompting the company to bring in new lawyers before the matter was adjourned to August 10.
This isn't even the first plea to get pulled back this year, Zostel walked back an earlier application before the same court just a month ago, on July 8. The underlying disagreement traces all the way to 2015, when OYO's proposed acquisition of Zostel first fell apart. Zostel has long argued it's owed close to a 7% stake in OYO as part of that deal, a claim that took a serious hit in May 2025 when the Delhi High Court set aside the arbitral award backing it, ruling that no binding agreement had actually been reached. Zostel's appeal against that ruling is still pending.
The timing adds extra weight to all of this. Zostel has separately gone to SEBI, arguing that OYO's draft IPO papers left out material details about the dispute, and is pushing for those disclosures to be reviewed as OYO moves through its listing process. A spokesperson for PRISM, for its part, dismissed the pattern of withdrawn applications as frivolous, arguing they were never maintainable to begin with. Either way, this is a fight neither side seems ready to walk away from.
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