The Bombay High Court on Monday restrained IDBI Trusteeship Services Ltd and UBS Bank from selling shares pledged by Kishore Biyani-led Future Retails FCRPL (Future Corporate Resources Private Limited) amid a share market collapse due to the novel coronavirus outbreak.
Justice K K Tated on Monday heard an application filed by FCRPL and Rural Fairprice Wholesale Ltd (RFWL) seeking urgent relief in relation to the threatened sale of shares pledged to IDBI Trusteeship Services Ltd by a Debenture Trust Deed dated January 12, 2018 and April 10, 2019 in wake of the widespread market crash following emergency measures taken by the government to tackle the COVID-19 pandemic.
As per the plaintiff, the outstanding amount payable to IDBI is Rs 610 crore.
As per the Debenture Trust Deed, the plaintiffs pledged 8 per cent of their equity shares with the defendant.
The plaintiffs argued that if shares are sold in this situation, irreparable loss would be caused to them.
"It is to be noted that when the Debenture Trust Deed was executed, the market value of the shares were Rs 350 per share. Because of COVID-19, share market has collapsed and the per share value has come to below Rs 100," the court said in its order.
"Considering the present situation of the market and COVID-19, I am of the opinion that the plaintiffs require interim protection till next date," the court said, and posted the matter for further hearing on May 4.
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