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The National Company Law Tribunal (NCLT) has accepted Bank of India’s appeal to initiate insolvency proceedings against debt-ridden Future Retail Limited (FRL). Also, rejecting Amazon’s objection in this regard, Vijay Kumar Iyer has been appointed as the resolution professional of FRL.
This decision of the Mumbai Bench of NCLT has come as a setback to Kishore Biyani, owner of Future Retail Group and Amazon. In April this year, Bank of India had appealed to initiate insolvency proceedings against Future Retail. In April, Future Retail had defaulted on payment of Rs 3,493 crore.
Amazon had filed a petition
On May 12, Amazon filed an appeal for intervention in this matter. It had said that it is a nexus between Bank of India and Future Retail. So initiating this matter now would be a compromise on his rights. Future Retail has defaulted on its debtors with a total of Rs 5,322 crore. Due to dispute with Amazon and other reasons, it could not repay the debt of the borrowers.
24,713 crore deal broken with Reliance
The Amazon dispute also broke Future’s deal with Reliance Industries. In April, Reliance had said it could not go ahead with the deal with the Future Group. In 2020, Future Group had announced a merger of Rs 24,713 crore with Reliance Retail. This included 19 future companies.