India’s bankruptcy court admitted Future Retail Ltd. for liquidation after its lenders failed to receive any viable resolution plan to revive the company.

The Mumbai bench of the National Company Law Tribunal (NCLT) passed the liquidation order against the Kishore Biyani-promoted bankrupt retailer on 29 July, the tribunal order showed.

The development came after Future Retail’s resolution professional Vijaykumar Iyer sought a liquidation order based on the resolution passed by the company’s committee of creditors (CoC) on 26 October 2023.

The company’s resolution professional on 9 November 2023 submitted an application before the NCLT for initiation of liquidation of Future Retail under Section 33 of the Insolvency and Bankruptcy Code.

The development come after Future Retail’s creditors rejected the resolution plan submitted by Space Mantra Private Ltd. The last date for completion of the company’s corporate insolvency resolution process was 30 September.

“Looking at the application and averments made therein, it is evident that the maximum period of the CIRP (corporate insolvency resolution process) has expired, and no resolution plan has been approved by the CoC,” Judicial Member Kuldip Kumar Kareer and Technical Member Anil Raj observed in the order.

“We are of the considered opinion that this is a fit case for liquidation,” they noted.

The NCLT appointed Sanjay Gupta as Future Retail’s liquidator and ordered him to sell the company as a going concern to maximize the value of the company.

Future Retail was admitted into an insolvency resolution by the NCLT in July 2022, following a petition by the company’s financial creditor Bank of India over an alleged default amount of 1,441.62 crore rupees ($172 million).

The company’s admitted liabilities stood at over 28,452 crore rupees, including secured creditors debt of around 14,422 crore rupees and over 5,350 crore rupees of unsecured financial creditors.

Note: $1 = 83.7359 Indian rupees

(Send feedback to editor@cornerofficejournal.com)

India Watch List For Tuesday - March 14