Mumbai. Bank of India moved to close the books on a major retail default, declaring Kishore Biyani's Future Enterprises Ltd account as a fraud on Monday. The lender reported the development to the Reserve Bank of India, marking a definitive break from earlier attempts to recover the funds through standard debt collection mechanisms.
The exposure is substantial. The bank holds ₹575.4 crore in outstanding dues from Future Enterprises, a figure that has lingered on its balance sheet since the consumer goods conglomerate collapsed. By classifying the account as a fraud rather than a mere default, the bank acknowledges that recovery through ordinary legal means is likely futile.
This move follows the Mumbai bench of the National Company Law Tribunal (NCLT) admitting Future Enterprises to the Corporate Insolvency Resolution Process (CIRP) in February 2023. That legal filing signaled the end of the road for the company's operational viability. For months, creditors have watched as the insolvency process ground to a halt, leaving lenders in limbo.
Now, Bank of India is cutting its losses. The bank has made provisions for the entire ₹575.4 crore outstanding amount. This accounting step ensures the loss hits the current financial year, protecting future earnings from the drag of the bad debt. It is a rare, blunt admission of total loss in a sector where banks often prefer to keep assets on the books, hoping for a miracle.
The next phase involves the insolvency resolution process. Creditors will now push for a final decision on the liquidation or sale of Future Enterprises' assets. Until then, the fraud tag remains the primary barrier to any negotiated settlement, locking the debt in a legal and financial dead-end.