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A Supreme Court bench headed by Chief Justice of India and consisting of Justices Bopanna and Hima Kohli today did not pass any effective order in the plea by Future Retail Limited seeking directions of the court to restrain the banks from declaring it a Non-Performing Asset. 

Rakesh Dwivedi, senior advocate, appearing for the consortium of banks argued that these petitions are in the realm of pure financial contracts, the courts cannot interfere in it in Article 32. He added that there are 10 private and 3 foreign banks in the consortium so there is no question of infringement of fundamental rights. The loans were granted between 2015-2020 before the emergency order and the Amazon litigation.

Dwivedi further stated that these loans the default had been committed in 2020, they were restructured on the request of the Future Group. It was done on an agreed plan with the Future Group and they have to abide by certain timelines, he added.

Stressing that the retail giant owes rupees 17,000 crores to the banks, Dwivedi forwarded a suggestion that entire assets of FRL can be subjected to an open bid between Amazon and Reliance Industries, with whom also the Future group has formed private contracts.

He said, "Whoever is higher, let them take, this way we get our money. Whoever wins gets the company."

Upon this suggestion, Harish Salve, Senior Advocate, appearing for FRL, also said that he agrees with Dwivedi, however, he pointed out that Amazon cannot deposit a single rupee here being a foreign company. 

Thereafter, the court on hearing the parties decided not to pass any interim order and adjourned the writ petition. 

The Future group had moved a writ petition in the supreme court seeking a direction to restrain the banks from declaring it a Non-Performing Asset (NPA). On the last hearing, Salve had argued that the petition is filed in the following circumstances of desperation.

He had submitted that RBI has come up with a scheme in 2020 for those who were hit by the pandemic economically and future entered into an agreement, it required certain payments. The company had to sell assets to do so but they could not be sold owing to the litigation with Amazon.

Salve had also stated that if the banks could give Future time till September, everybody will be paid if the deal with Reliance succeeds. The court had asked the consortium of banks to file an affidavit in this regard, which was filed today. 

Case title: Future Retail Ltd Vs RBI