Future Enterprises to undergo insolvency process after failing to clear Rs 1-cr debt
After Future Retail, another Future group company – Future Enterprises – will undergo corporate insolvency resolution process (CIRP) after the Mumbai bench of the NCLT allowed the insolvency application of Foresight Innovations Private Limited, a UK-based company.
Foresight Innovations had moved NCLT against Future Enterprises after the Kishore Biyani-led company failed to pay a paltry sum of Rs 1 crore to the former. The NCLT has appointed Jitender Kothari as the interim resolution professional (IRP).
When the operational creditor (Foresight Innovations) had moved the NCLT against Future Enterprises in December 2022, the latter had requested two months’ time to clear the dues. The counsel appearing for Future Enterprises had then submitted that the corporate debtor is a functional company with thousands of employees working in it and the corporate debtor is not in a position to pay the small amount of Rs. 1 crore of the Operational Creditor due to freezing of the accounts of the corporate debtor by all the lenders.
However, the company failed to pay the dues even after the completion of two months forcing the NCLT to allow the insolvency petition against it.
With the pronouncement of the CIRP, the management of the affairs of Future Enterprises now vests in the IRP; the powers of the board of directors stand suspended and are to be exercised by the IRP; the officers and managers of the Corporate Debtor will report to the IRP and provide access to such documents and records of the Corporate Debtor as may be required by the IRP. Also, the financial institutions maintaining accounts of the Corporate Debtor are required to act on the instructions of the IRP in relation to such accounts and furnish all information relating to the Corporate Debtor available with them to the IRP.
A moratorium has been declared with the CIRP order prohibiting the institution of suits or continuation of pending suits or proceedings against the Corporate Debtor including execution of any judgement, decree or order in any court of law, tribunal, arbitration panel or other authority. The moratorium shall be effective till the date of the completion of the CIRP.
Future Enterprises develops, owns and leases the retail infrastructure for Future group. The company also holds the Group’s investments in subsidiaries and joint ventures including insurance, textile manufacturing, supply chain and logistics. While Future Supply Chains manages the logistics- from warehousing, storage to distribution of raw materials and products, Future Generali- a JV with the globally known Generali Group, offers financial security solutions like savings, insurance and policies to its customers.
