Kewal Ahuja and SGF Face Growing Legal Troubles Amid Franchisee Allegations
New Delhi – The legal storm surrounding Kewal Ahuja, the founder of Spice Grill Flame (SGF), has intensified as multiple franchise owners and investors accuse the company of fraud and misrepresentation. Once a flourishing business with more than 45 outlets, SGF's network has dwindled to just 15 locations, amid mounting complaints of poor service quality, unfulfilled promises, and financial mismanagement.
SGF operates under two franchise models: FOFO (Franchise-Owned, Franchise-Operated) and FOCO (Franchise-Owned, Company-Operated). Investors who chose the FOCO model were promised a fixed monthly return of Rs. 37,500, with SGF overseeing the operations. However, one such outlet in Sector 31, Gurgaon, was abruptly shut down without notice to the investor, and the monthly payments stopped within a year.
In an effort to downplay the extent of its declining network, SGF, under Ahuja's leadership, rebranded its website, removing details of its operating outlets. Archived records, however, show that around 70% of SGF's outlets have closed, shedding light on the company's significant downturn and highlighting the dissatisfaction of investors who feel misled.
Despite public claims of operating over 30 locations and offering returns of more than 223% over six years, the situation now paints a different picture. Legal proceedings have been initiated by New Horizon (The Law Firm), with primary counsel Ms. Pratima Ravi and arguing Counsel Mr. Yogesh Sharma leading the case. The proceedings involve two civil suits filed in the District Court of Rohini. Case No. CS/DJ/302/2023 seeks the recovery of promised minimum returns to investors, while Case No. CS(Comm) 6835/2024 demands full restitution of invested amounts.
In SGF’s defense, the company claims that financial difficulties arising from the COVID-19 pandemic hindered its ability to meet payment obligations. Meanwhile, mediation in the second case has reached a deadlock, and SGF has yet to submit a formal defense.
The restaurant at the heart of the dispute, which was launched during the pandemic, closed within a year, leaving investors with substantial financial losses. As the legal proceedings unfold, Kewal Ahuja’s actions are under increasing scrutiny. The outcomes of these cases could have far-reaching consequences for the future of SGF and its franchise network, potentially reshaping the company’s standing in the industry.