The resolution professional managing the insolvency of Kishore Biyani’s flagship Future Retail Ltd will petition the National Company Law Tribunal (NCLT), alleging lack of cooperation from the company’s promoters and statutory auditors.
The resolution professional (RP) will file a petition under Section 19 (2) of the Insolvency and Bankruptcy Code, which allows the insolvency manager to file a plea before the adjudicating authority, seeking necessary directions, when the required parties fail to cooperate. The case is expected to be heard by NCLT on Monday, one of the legal counsels aware of the matter said on condition of anonymity. “Generally, he (RP) needs information and data about the latest affairs and business so that he can collate it for his process and can run the company smoothly. But, in most cases, as the senior management, promoters and professionals are aware of everything, RP seeks their assistance,” said Ashish Pyasi, partner at Dhir and Dhir Associates.
In the event of non-cooperation, the resolution professional has no choice but to approach the tribunal for directions against the concerned people, who may be personnel of the company or its promoters or anyone associated with the company, Pyasi added. If the tribunal is satisfied that there is non-cooperation, then it can pass any direction, which may include directing such people to comply with the directions of the RP and to provide assistance for the management of the company.
There have been cases in the past where the tribunal has come down heavily on people who have not provided that assistance which included the assistance of police for the smooth running of the company, Pyasi said.
In the matter, a petitioner from Gurugram informed the NCLT that despite repeated requests, he did not get access to his property leased to Future Group and that the property has been locked for several months. It is then that the counsel appearing on behalf of RP informed the bench that the promoters of Future Group were not cooperating with him and were not providing necessary information concerning the assets of the company.
On 23 January, Kishore Biyani, in a letter to the RP, stated his intention to step down from the position of executive chairman and director of Future Retail immediately, the company informed the exchanges.
Future Retail resolution professional Vijaykumar V. Iyer declined to comment on Mint’s queries, while an email sent to the company remained unanswered.
Biyani had written a letter to Iyer, that as the chairman of the company, he had been holding on to the position even after the initiation of insolvency proceedings against the company and suspension of the board, including the chairman and all the rights of the board and the chairman being suspended.
He also said that “I have completed the required handholding within my capacity for you to take over the entire control of the company and its assets, and I have also completed the handover of whatever information and data, which was earlier available with the management or which could be retrieved from ex-employees or third parties and have shared with you all the insight about the business and operations and various hurdles faced by the management. I believe that me or the earlier management do not have anything to share with you.”
