Another Kishore Biyani firm Future Ideas Company to face insolvency proceedings

The National Company Law Tribunal (NCLT), Mumbai Bench, has admitted a corporate insolvency petition against Future Ideas Company Limited (FICL), part of the erstwhile Kishore Biyani-led Future Group, filed by Axis Trustee Services Limited, acting as the debenture trustee for Franklin Templeton Asset Management. The tribunal declared a moratorium on the company’s assets and appointed an interim resolution professional (IRP) to oversee the insolvency process.

Background of the Case
Axis Trustee Services initiated insolvency proceedings under Section 7 of the Insolvency and Bankruptcy Code (IBC), citing a default of Rs. 122.83 crore as of September 2022. The debt arose from non-convertible debentures (NCDs) issued by FICL across four series in 2018, which were due for redemption starting January 2020. The tribunal noted that the default occurred on April 30, 2021, outside the COVID-19-related insolvency suspension period (March 25, 2020–March 24, 2021), making the application admissible.

FICL’s defense rejected
Future Ideas Company contested the petition, arguing that its liabilities under the NCDs had been transferred to Rivaaz Trade Ventures Pvt. Ltd (RTVPL) through an Acquisition Agreement dated August 29, 2020. It claimed Axis Trustee Services no longer held creditor status. However, the tribunal dismissed this argument, stating the agreement was part of a failed Composite Scheme of Arrangement involving Future Group’s merger with Reliance Retail. The scheme required NCLT approval, which was never obtained.

“The Acquisition Agreement was an instrument created by FICL with intent to defraud creditors… The management acted in total disregard to creditor interests,” the tribunal observed, highlighting FICL’s failure to transfer essential assets like the Debenture Redemption Reserve to RTVPL.

Key tribunal findings

• Section 10A Inapplicable: The default date (April 2021) fell outside the IBC’s COVID-19 moratorium period.
• Acquisition Agreement Invalid: The transfer of liabilities to RTVPL lacked statutory consent from debenture holders and contravened the Debenture Trust Deed.
• Locus Standi Upheld: Axis Trustee Services retained authority as the debenture trustee to act on behalf of investors.

The tribunal imposed an immediate moratorium, halting lawsuits, asset transfers, and recovery actions against FICL. Mr. Ritesh Agarwal, a registered insolvency professional, was appointed IRP to manage the Corporate Insolvency Resolution Process (CIRP).

The decision, pronounced on 9 April 2025, also encompassed the disposal of several Interlocutory Applications filed by Future Ideas Company Limited, which were interconnected with the main application. This ruling paves the way for the commencement of the CIRP against Future Ideas Company Limited, marking a critical juncture for the company and its stakeholders.

Also see: Kishore Biyani’s Future Retail, once a leading Indian retailer, is being liquidated