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Future Retail seeks SC protection from defaulter tag by lenders

🔴 The matter will be mentioned for urgent hearing by FRL’s lawyers on January 28.

Written by Indu Bhan | New Delhi |
January 26, 2022 4:20:21 am
Future Retail, Supreme Court, Future Retail Supreme Court, SBI, IndusInd, DBS, HDFC, Union Bank of India, Reserve Bank of India, RBI, non-performing asset, indian expressA shopper walks through an aisle displaying personal care goods at a Big Bazaar hypermarket, operated by Future Retail Ltd., in Mumbai. (Bloomberg)

Future Retail (FRL) on Tuesday moved the Supreme Court seeking protection from being declared a defaulter for failing to pay loan dues of Rs 3,494.56 crore to its 26 lenders. The matter will be mentioned for urgent hearing by FRL’s lawyers on January 28.

The company — while making the RBI and 26 banks including SBI, IndusInd, DBS, HDFC, Union Bank of India, as respondents in its petition — has told the SC that despite being aware of the impact of Covid-19 pandemic on its business/stores and also the freeze on the sale of its small-format stores due to its ongoing dispute with Amazon, the lenders sent default notices to it earlier this month.

FRL apprehends that apart from its account being declared as non-performing asset (NPA), the lenders would also publish its and its board of directors’ names as wilful defaulters, thereby reducing its credit rating and consequently compromising its ability to raise any further finance.

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Pursuant to the declaration of NPA by any of its 26 lenders, its account would stand classified as NPA by other lenders as well and would also adversely affect its other group companies which have availed the one-time restructuring (OTR) facility, it told the apex court.

FRL had missed the due date for payment of Rs 3,494.56 crore to banks and lenders as it could not sell assets due to its ongoing litigation with Amazon, impacting its monetisation plans. FE

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