New Delhi: The shuttered retail chain Subhiksha Trading Services Ltd, which is facing winding-up petitions, has appealed to the Madras high court seeking another chance to reach a compromise with creditors.
Legal recourse: A Subhiksha store in New Delhi. Cash and Carry, which is also owned by Subhiksha founder R. Subramanian, made the appeal before the Madras high court was closed for holidays earlier this month. Harikrishna Katragadda / Mint
Cash and Carry Wholesale Traders Pvt. Ltd, a company promoted by Subhiksha founder R. Subramanian, filed the appeal to a wider bench after a single judge set aside an earlier petition and admitted the suits seeking the dissolution of the company. Those petitions are to be heard on 5 October.
Subramanian confirmed the development in an emailed response.
The appeals won’t gain support from other stakeholders in Subhiksha, including the Azim Premji-owned fund Zash Investment and Trading.
“We have opposed it there (the earlier application) and we will oppose it here (the latest appeal),” said P.H. Arvindh Pandian, the lawyer representing Zash Investment that had invested around Rs230 crore by buying a 10% stake in Subhiksha months before the retailer went out of business amid a financial crisis.
Chennai-based Subhiksha wants to reach an agreement with creditors and vendors on about Rs900 crore of dues. Cash and Carry made the appeal before the Madras high court was closed for holidays earlier this month, according to Subhiksha’s lawyer Prakash Goklaney. The latest plea will come up for hearing when the court reopens in early October.
Subhiksha and Cash and Carry are promoted by the same concerns—RS Associates and SSS Trust, both of which are connected to Subramanian and his family.
Kotak Mahindra Bank Ltd has filed a winding-up lawsuit to recover its dues from the retailer. Seven more winding-up petitions were filed by companies including Tata Teleservices Ltd, Adlabs Films Ltd and media buying firm Mediaedge cia: India Ltd.
In August, Cash and Carry had filed for a compromise with lenders and creditors after a consortium of 13 banks failed to complete Subhiksha’s corporate debt restructuring before a July-end deadline. The lenders, including ICICI Bank Ltd, HDFC Bank Ltd and Bank of Baroda, have dues of about Rs750 crore.
Subhiksha began closing its nationwide network of 1,600 stores in January.