Debt-ridden The National Company Law Tribunal (NCLT) has delayed the deadline for concluding the firm’s bankruptcy procedures to August 1, making it harder for Future Retail Ltd.’s (FRL) insolvency resolution to be completed.The Mumbai bench granted FRL’s request to remove 33 days from the corporate insolvency resolution process beginning on October 17, 2023.
In-depth details on NCLT extends the deadline for concluding Future Retail’s insolvency resolution to August 17
According to information provided by the firm in a regulatory filing, the Mumbai bench granted FRL’s request to omit 33 days from the corporate insolvency resolution process (CIRP).
In support of the aforementioned, the NCLT heard the application on July 17, 2023, and approved FRL’s request for a 33-day exception from the CIRP.
“Therefore, the last date for completion of CIRP of FRL is August 17, 2023,” it continued. FRL claims that this is based on an oral ruling by the NCLT bench, and a written order is still pending.
The NCLT bench had earlier in April given FRL a 90-day extension until July 15, 2023, to finish the CIRP.
The Insolvency & Bankruptcy Code (IBC) stipulates that the CIRP must be finished in 330 days, which includes the time needed for legal proceedings.
On July 20, 2022, NCLT began the CIRP against FRL due to a loan default.
The CIRP must be finished in accordance with Section 12(1) of the Code 180 days after it has been initiated.
However, NCLT has the discretion to grant a single 90-day extension. Including any extensions or litigation periods, the maximum amount of time that must be allotted for the completion of CIRP is 330 days.
Prior to May 15, the deadline for submitting resolution plans, FRL had stated that it had received six bids from potential buyers.
48 enterprises that were on the final list of “Eligible Prospective Resolution Applicants” had until May 15, 2023, to submit their resolution plans.
This is true even though FRL lenders submitted updated Expressions of Interest (EoIs) and requested new bids after grouping their assets into clusters.
Future Retail is going through CIRP and has debts of almost Rs 30,000 crore.
As FRL had not attracted a resolution plan in more than four months, creditors of the company issued a new call for expressions of interest (EoI) on March 23, 2023, inviting interested parties to submit bids for the insolvent company “as a going concern or individual cluster or a combination of clusters of its assets.”
Under brands such Big Bazaar, Easyday, and Foodhall, FRL operated a variety of retail formats in the hypermarket supermarket and home markets. At its height, FRL had more than 1,500 locations operating in almost 430 cities.
It was one of 19 Future group firms that were to be transferred to Reliance Retail as part of a deal for Rs 24,713 crores that was announced in August 2020. These companies operate in the retail, wholesale, logistic, and warehousing sectors.
Despite Amazon’s legal fight, lenders had rejected Reliance’s acquisition of the 19 Future group companies, including FRL.
