Liquidation of Kishore Biyani's Future Retail Ordered by NCLT

The National Company Law Tribunal (NCLT) has approved the liquidation of Future Retail, led by Kishore Biyani. This decision follows the expiration of the maximum period allowed for the corporate insolvency resolution process (CIRP) without any approved resolution plan. Sanjay Gupta has been appointed as the liquidator by the Mumbai bench of NCLT.

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The tribunal's order, issued by Anil Raj Chellan and Kuldip Kumar Kareer, stated, "Looking at the application and averments made therein, it is evident that the maximum period of the CIRP has expired and no Resolution Plan has been approved by the CoC. We are of the considered opinion that this is a fit case for liquidation. Therefore, we hereby order the liquidation of the Corporate Debtor."

Resolution Professional's Efforts

Vijaykumar V Iyer, the resolution professional for Future Retail, was unable to secure any resolution applicants to revive the insolvent company. In November 2023, he filed an application with NCLT Mumbai seeking liquidation after lenders opted for this course of action. The Committee of Creditors (CoC) had passed a resolution in October 2023 to proceed with liquidation.

The CoC, led by Bank of India, initiated insolvency proceedings against Future Retail in April 2022 due to non-repayment issues. The retail firm owes over Rs 17,000 crore to its financial and operational creditors. The NCLT admitted the company under insolvency in July 2022.

Failed Resolution Attempts

Despite initial interest from various applicants, none submitted final resolution plans. Space Mantra emerged as the sole resolution applicant with a Rs 550-crore bid but was not part of the initial list of bidders. The lenders rejected Space Mantra's plan, prompting the resolution professional to seek liquidation from the tribunal.

The decision to liquidate Future Retail underscores the challenges faced in turning around debt-ridden companies within stipulated timelines. The inability to secure a viable resolution plan highlights systemic issues within corporate insolvency processes.

This development marks a significant step in addressing Future Retail's financial troubles. The liquidation process will now proceed under Sanjay Gupta's supervision as appointed by NCLT.