Future Enterprises faces second plea to initiate insolvency

Debt-ridden Future Enterprises Ltd is now facing a second plea filed by an operational creditor of the company before National Company Law Tribunal to initiate insolvency proceedings.

The latest petition is filed against Future Enterprises by Retaail Detailz India, claiming default of Rs 4.02 crore before the Mumbai bench of the National Company Law Tribunal (NCLT).

"The Company has received e-filing confirmation from NCLT with respect to the filing of an application by an Operational Creditor Retail Detailz India Private under section 9 of the IBC for an alleged default amount of Rs 4.02 crore," Future Enterprises said in a late evening filing on Tuesday. No further date has been allotted so far for hearing the said application, it added.

Last week, another operational creditor, Foresight Innovations, had filed an application under Section 9 of the Insolvency and Bankruptcy Code (IBC) 2016, for an alleged default amount of Rs 1.58 crore before the Mumbai bench of NCLT. The next date of hearing of this petition is August 26, 2022.

Section 9 of the IBC gives power to operational creditors of a company to initiate a corporate insolvency resolution process in case of a default. Operational creditors are those whose debt is owed on account of dues arising out of business transactions. This mostly includes claims for the delivery of goods or services and employment.

Future Enterprises, part of the Kishore Biyani-led Future Group, is facing difficulties like other firms of the group. On Tuesday, its Non-Executive Director Chandrapraksh Toshniwal resigned from the board of directors.

Future Enterprises was part of the 19 group companies operating in retail, wholesale, logistics and warehousing segments which were supposed to be transferred to Reliance Retail as part of a Rs 24,713-crore deal announced in August 2020. The deal was called off by the billionaire Mukesh Ambani-led Reliance Industries Ltd in April.

It had recently committed several defaults on payment of interest on its several non-convertible debentures. NCLT has already initiated insolvency proceedings against Future Group's flagship firm Future Retail Ltd.