Mumbai, July 10: The Mumbai Bench of the National Company Law Tribunal (NCLT) has admitted Future Consumer Limited, a Future Group company, into the Corporate Insolvency Resolution Process (CIRP) after finding that the company had allegedly defaulted on financial obligations of Rs 263.77 crore owed to Resurgent India Special Situations Fund.
The tribunal held that the existence of a financial debt and default had been clearly established, leaving no legal ground to reject the insolvency plea.
“In view of the above, we find that the requisite conditions necessary to trigger CIRP in respect of the Corporate Debtor are fulfilled. The application is complete as all the relevant documents have been attached by the applicant. As a result, the matter deserves to be admitted under Section 7 of the Code,” the tribunal observed.
Tribunal Admits Insolvency Plea
The petition was filed under Section 7 of the Insolvency and Bankruptcy Code (IBC) by Resurgent India Special Situations Fund, which had acquired non-convertible debentures originally subscribed by CDC Emerging Markets Limited.
The financial creditor submitted that Future Consumer had defaulted on repayment obligations arising from secured debentures worth Rs 200 crore, with the outstanding dues increasing to Rs 263.77 crore as of June 30, 2025.
The tribunal noted that the company had been granted multiple extensions and waivers by the debenture holders but continued to default on its repayment obligations.
It also relied on the company's acknowledgment of liability through a letter dated August 12, 2025, along with disclosures in its audited financial statements, to conclude that both the debt and the default stood admitted.
“The Debentures carried an obligation of repayment along with interest and were secured through mortgage, hypothecation, pledge of shares and personal guarantee. Subsequently, vide Final Term Sheet dated October 10, 2018, the Original Debenture Holders agreed to subscribe to the residual 500 senior, fully secured, redeemable, transferable and interest-bearing non-convertible debentures aggregating to Rs 50 crore. The amount raised through subscription of debentures clearly falls within the ambit of Section 5(8)(c) of the Code as money raised pursuant to the issuance of bonds, notes, debentures or similar instruments constitutes a financial debt,” the order stated.
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Company's Defence Rejected
Future Consumer opposed the insolvency proceedings, arguing that its financial distress was an outcome of the COVID-19 pandemic and several other relevant factors.
The company also contended that it remained a going concern with employees and expected recoveries from pending arbitration proceedings that could enable it to discharge its liabilities.
Rejecting these submissions, the NCLT observed that commercial setbacks, failed restructuring efforts and anticipated future recoveries do not extinguish an existing financial debt.
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