SC to hear Future Retail's plea against being declared defaulter

Future, the country's second-largest retailer, has since 2020 failed to complete its $3.4 billion retail asset sale to a rival due to a row with Amazon

The Supreme Court on Thursday agreed to consider on January 31 a plea by Future Retail for protection against being declared defaulter for failing to pay loan dues of Rs 3,494.56 crore to its 26 lenders.

A bench presided over by Chief Justice N V Ramana said that it would like to hear Amazon's side, even as senior counsel Mukul Rohtagi, appearing for FRL, said that the e-commerce firm had nothing to do with this fresh petition.

The FRL approached the top court against its 26 lenders for issuing default notices. It, however, rejected Amazon’s offer of financial support, saying its asset valuation at Rs 7,000 crore is much lower than that offered by Reliance Industries.

Amazon is already opposing the sale of FRL's assets, which include more than 1200 Big Bazar stores across the country, to Reliance Retail.

FRL told the SC that the lenders have sent default notices to it earlier this month, despite being aware of the impact of the Covid-19 pandemic on its business, and stores and also the freeze on the sale of its small-format stores due to its ongoing dispute with Amazon.

The Indian retailer apprehended that apart from its account being declared as a non-performing asset (NPA), the lenders would also publish 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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