NCLT to hear insolvency petition against Future Retail on June 6
MUMBAI: The NCLT Mumbai on Thursday adjourned the hearing on Bank of India’s plea to admit its insolvency petition against Future Retail (FRL) to June 6. The adjournment followed a request for a week’s time by FRL counsel Shyam Kapadia to file its reply opposing admittance of BoI’s petition under Section 7 of the IBC.
BoI has a total exposure of Rs 1441.62 cr to FRL, which cumulatively owes 26 banks around Rs 15,000 cr. Senior advocate Ravi Kadam pressed for admittance of the petition on grounds of “existence of debt and existence of default,” citing Cibil and NeSL records of the amounts FRL owed to BoI under various facilities and the events of default. He also cited exits of FRL’s MD Rakesh Biyani and its company secretary as grounds for urgent admission and appointment of an interim resolution professional to take charge of the company.
However , Kapadia cited a petition of FRL pending before the Supreme Court which prays, among others , that banks don’t tag the company an NPA for its inability to meet its dues under the framework agreement because of its legal tussle with Amazon.
This tussle, he argued , held up FRL’s plans to monetise its small format stores to pay back the banks.
BoI’s decision to press for insolvency was reportedly hastened after Reliance in February took over 835 stores of FRL, which couldn’t pay rent to it for the same.