Mumbai: On Wednesday, February 6, the Mumbai bench of NCLT ordered the liquidation of bankrupt Reid and Taylor on account of failure by representatives of India Gas to meet eligibility criteria.
The matter was heard before a bench comprising Bhaskara Pantula Mohan and V Nallasenapathy, who while dismissing the bid observed that the Delhi-based India Gas was inefficient in conveying and proving itself bona fide before the Tribunal.
The bench stated, “We call upon the registrar and the resolution professional to put in their best efforts to ensure that the company is sold as a going-concern. This bench had honest intentions to prevent the company from going into liquidation, protect employees and save creditors including public sectors who had put in public money to get back maximum returns,”
During the hearing, leading as the fronting bid, representatives of India Gas were unsuccessful in satisfying mandatory net worth of ₹50 crore and other bona fides, despite being in favour of investing the ₹2 crore non-refundable earnest money deposit.
Disappointed with the representation, the Reid & Taylor Employees Association has decided to move the Appellate Tribunal on Friday, February 8, challenging the liquidation order. The Association has alleged India Gas of being manipulated by the largest creditor to the company, Finquest Financial.
The Nitin Kasliwal company RTIL, a premium clothing provider that sells under the international brand ‘Reid & Taylor’ in India, is struggling to pay off its ₹3,800-crore debt. At present, the factory outlet in Mysuru is still functional with about 30-40 per cent production capacity, employing about 1,200 personnel and another 200-250 contract labourers.
It is pertinent to note that while passing the order, the Tribunal also instructed the Resolution Professional to ensure the brand is protected as an ongoing concern, in the interest of the workers.