FRL's digital database before insolvency not available: Compliance officer

Future Retail's structured digital database before corporate insolvency resolution process has not been available for verification for quarter ending September, says the company's compliance officer

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Future Retail's structured digital database prior to the corporate insolvency resolution process has not been available for verification for the quarter that ended September due to various reasons, including non-cooperation from erstwhile management and lack of administrative arrangements, the company's newly-appointed company secretary and compliance officer said in a regulatory filing.

The company has now initiated the process of inviting competitive quotes to purchase the software necessary for the maintenance of the structured digital database to comply with Sebi regulations, FRL Compliance Officer Pratiksha Salecha said in note filed on BSE by the company.

Under the Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, listed companies are required to maintain a secured digital database which has to be verified.

Salecha was appointed on September 29, 2022, Compliance Officer of Future Retail Ltd (FRL) against which the Corporate Insolvency Resolution Process (CIRP) was initiated on July 20, 2022.

According to him, the required information to determine the compliances was not available for verification during the quarter that ended in September 2022.

"Several attempts were made to reach out to the prior management, officers and other personnel of the Company to gain information, inter alia, on the secured digital database of the Company as may have been maintained from prior to the Insolvency Commencement Date,

"However, owing to various operational constraints including suspension of powers of board, exit of all Key Managerial Personnel and senior employees of the Company including the previous compliance officer and company secretary, non-cooperation from erstwhile management, and lack of administrative arrangements, the required information to determine the compliances... has not been available for verification during the quarter ended September 2022," he said.

Salecha has also submitted that despite the financial crunch, FRL has initiated the process of inviting competitive quotes to purchase the software necessary for the maintenance of the structured digital database, to ensure compliance.

He "will endeavour to maintain the structured digital database as required under PIT Regulations, from the quarter ending on December 31, 2022 and onwards, the filing said.

Meanwhile, in a separate filing FRL informed the exchanges about the final list of eligible prospective bidders, which includes Reliance Retail, Adani Group's JV April Moon Retail and 11 other companies.

These companies have been included in the final list of prospective resolution applicants after receiving no objections from stakeholders concerned to the provisional list issued on November 10, said an update from Resolution Professional for Future Retail Limited (FRL).

The Mumbai bench of the National Company Law Tribunal (NCLT) had on July 20 directed to initiate CIRP against FRL, admitting a plea filed by the Bank of India.

Section 12 (1) of the Insolvency and Bankruptcy Code (IBC) mandates a CIRP to be completed within a time frame of 180 days from the date of admission of the application. However, under the request of the RP, the NCLT can extend the duration by another 90 days.

It should be mandatorily completed within 330 days, including any extension and the time taken in legal proceedings.