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Future Retail For Liquidation By NCLT: The NCLT has ordered the start of the liquidation process by allowing Kishore Biyani's company Future Retail, which laid the foundation of modern super stores in the country and was once considered a giant in the retail sector, to file for bankruptcy. The Mumbai branch of the National Company Law Tribunal has directed the company to appoint a liquidator and start bankruptcy proceedings as the company does not have any proper recovery plan.
While accepting the bankruptcy petition of Future Retail, which operates top supermarkets like Pantaloon, Big Bazaar, FBB, Central, Easyday, NCLT said that no proper recovery plan has been presented by the committee of creditors. In the absence of a recovery plan within the time limit prescribed for the corporate insolvency resolution process, the application to close the company is approved. Future Retail has a total debt of Rs 28452 crore. Out of this, Rs. 18422 crore is a debt of various financial institutions. Sanjay Gupta has been appointed as the liquidator for the insolvency proceedings.
The tribunal said in its decision that it is appropriate for us to file bankruptcy in this case. To realize the maximum value of the corporate debtor, the liquidator has to sell the assets of the corporate debtor as per Section 32 (e) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016. In November last year, the resolution officer had told the stock exchanges that the company's resale plan has been rejected and there is no option but to liquidate it.
Future Group was badly hit by the Covid lockdown. They had a Rs. 24713 crore deal with Reliance but the deal fell through as its creditors voted against the company and the reconstruction plan.
