NCLT Mumbai Initiates Insolvency Process Against Future Lifestyle Fashions, A Future Group Enterprise
Pallavi Mishra
9 May 2023 10:45 AM IST
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising of Shri Kuldip Kumar Kareer (Judicial Member) and Shri Shyam Babu Gautam (Technical Member), while adjudicating a petition filed in Bank of India v Future Lifestyle Fashions Limited, has initiated Corporate Insolvency Resolution Process (“CIRP”) against Future Lifestyle Fashions Ltd., which is a Future...
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising of Shri Kuldip Kumar Kareer (Judicial Member) and Shri Shyam Babu Gautam (Technical Member), while adjudicating a petition filed in Bank of India v Future Lifestyle Fashions Limited, has initiated Corporate Insolvency Resolution Process (“CIRP”) against Future Lifestyle Fashions Ltd., which is a Future Group enterprise promoted by Mr. Kishore Biyani. Further, Mr. Ravi Sethia has been appointed as the Interim Resolution Professional (“IRP”).
Background Facts
Future Lifestyle Fashions Ltd. (“Corporate Debtor”) is the flagship fashion business of the Mr. Kishore Biyani led Future Group of companies, which have dominated the retail sector in India for years. FLFL operates more than 300 stores across India and owns retail fashion chains such as Central and Brand Factory.
The Bank of India (“Financial Creditor”) as a member of a Consortium of Lenders had extended certain credit facilities to the Corporate Debtor for the purpose of its operations, expansion and working capital needs. In 2013, the Financial Creditor granted credit facilities aggregating to Rs. 435 Crores to the Corporate Debtor which was last renewed in January 2020.
The account of the Corporate Debtor was declared Non-Performing Asset (“NPA”) on 31.05.2022 and the loans could not be repaid.
Therefore, the Financial Creditor filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 (“IBC”), seeking initiation of Corporate Insolvency Resolution Process (“CIRP”) against the Corporate Debtor. The amount in default is Rs. 185,84,50,611/- inclusive of interest.
The Adjudicating Authority observed that since debt and default have been established, the petition is liable to be admitted. Accordingly, CIRP has been initiated against the Corporate Debtor. Mr. Ravi Sethia has been appointed as the Interim Resolution Professional (“IRP”).
Case Title: Bank of India v Future Lifestyle Fashions Limited
Case No.: CP No. (IB) 959/ MB/ 2022
Counsel for Petitioner: Advocate Ravi Kadam
Counsel for Respondent: Advocate Shyam Kapadia
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