NCLAT sets aside Future Consumer's plea for insolvency against Aussee Oats

Appellate Tribunal NCLAT has set aside an appeal by Future Consumer Ltd (FCL) seeking to initiate insolvency against Aussee Oats Ltd.

A two-member NCLAT bench has upheld the orders of the Mumbai bench of the National Company Law Tribunal (NCLT), which had rejected the claims of FCL, part of the debt-ridden Future Group.

FCL had claimed an amount of over Rs one crore due from Aussee Oats. It had given Rs two crore to Aussee Oats in the form of an Inter-Corporate Deposit.

According to FCL, out of the total deposit, only Rs 1.35 crore has been paid, and the rest Rs 65 lakh is due, which now, along with interest, totals over Rs one crore.

However, NCLT observed that the financial statement of the corporate debtor (Aussee Oats) reflected a 'set off' of the claims, and there was NIL amount payable to the Financial Creditor (FCL).

Moreover, it also observed a dispute between them.

This order was challenged by FCL before the National Company Law Appellate Tribunal (NCLAT), which also rejected the plea of the Future Group firm.

"We are of the view that the Adjudicating Authority (NCLT) did not commit any error in relying on the said financial statement for coming to the conclusion that there is no debt for which insolvency can be proceeded," the NCLAT said.

The appellate tribunal also noticed that there is a dispute between the Financial Creditor and the Corporate Debtor's shareholders.

"We, thus, are of the view that in the facts of the present case, the refusal of the Adjudicating Authority to initiate insolvency in the facts cannot be faulted. We do not find any error in the order of the Adjudicating Authority. The Appeal is dismissed," according to the NCLAT.

FCL, along with Aussee Oats India, had a joint venture with Aussee Oats Milling Private Ltd.