Supreme Court reserves its verdict on the arguments of Future Group companies
– World Affairs SRS
A bench headed by Chief Justice NV Ramana said, “We reserve the order. All the four SLPs (Special Leave Petitions) are over. There is a lot of homework for us. Anyway I will not write a lengthy judgment.”
Initially, the bench, which also included Justices AS Bopanna and Hima Kohli, suggested to the counsel for firms of Amazon and Future Group that the Single Judge Bench of the Delhi High Court to hear Future Group’s statutory appeals against the final arbitral award. to be allowed. of SIAC.
The bench said the petitions, which are arising out of the EA’s decision and are pending before it, “cannot be relevant now as the final decision of the SIAC has already been passed”.
“Your (Future Group) first SLP which has challenged the order of Justice JR Midha (Delhi HC), we had said that there is no implementation of that order. We have never asked the Delhi High Court to hear the matter. did not say.” The Bench made the observation initially.
The top court has reserved its order on two petitions filed by FCPL (Future Coupons Pvt Ltd) and FRL (Future Retail Ltd).
A set of appeals challenged the March 18 order of the Delhi High Court, which, besides restraining FRL from pursuing its deal with Reliance Retail, imposed a cost of Rs 20 lakh on Future Group and others associated with it and His properties were ordered to be attached. ,
The second set of appeals has been filed against the recent order of the Delhi High Court seeking to stay the arbitration tribunal’s decision refusing to interfere in SIAC’s EA, which it had filed with Reliance Retail for a Rs 24,731 crore merger deal. was prevented from proceeding.
During the hearing on Tuesday, senior advocates Harish Salve and Mukul Rohatgi appeared for FRL and FCPL respectively and US e-commerce major, Amazon was represented by senior advocates Gopal Subramaniam and Ranjit Kumar and others.
Salve said the adverse orders passed on February 2 and March 18 last year would have to be set aside for the merger deal to go ahead.
The US firm, which has invested in FCPL, has been opposing the deal.
The senior counsel said that if the deal with RRL is not done then FRL “will drown with 30,000 employees losing their jobs”.
FRL and FCPL said that they be allowed to proceed with the planned negotiating proceedings with Reliance to ensure that they would be able to finalize the deal once the dispute with Amazon is over.
“We got drowned earlier because of the lockdown when people didn’t go to the shops. We are in this financially precarious situation. Luckily the banks are ready to wait and say if any transaction is through Reliance deal. Banks will have to pay. The Reliance deal is close to Rs 26,000 crore, and Amazon’s stake is close to Rs 14000 crore. About 30,000 jobs will be saved. If you put it all together, we come to that final stage. That’s it. Don’t let that go through the final phase. Amazon’s interests aren’t hurt,” Salve said.
He said that even though the courts ultimately found that the Reliance Industries Limited arm could not acquire the assets of FRL, the apex court’s September 9, 2021 order protected Amazon.
On September 9 last year, the apex court had stayed for four weeks all proceedings before the high court regarding the implementation of the EA and also statutory authorities such as the National Company Law Tribunal (NCLT), Competition Commission of India (CCI). was instructed. And the Securities and Exchange Board of India (SEBI) in the meantime will not pass any final order relating to the merger deal.
SIAC in EA had given relief to US e-commerce major Amazon by preventing Future from going ahead with the Rs 24,731 crore merger deal of Future Retail Ltd (FRL) with Reliance Retail.
Amazon had dragged Future Group to arbitration in SIAC in October last year, arguing that FRL had breached their contract by making a deal with rival Reliance Retail.
On October 21 last year, a duly constituted panel of arbitrators in the SIAC reiterated the EA’s decision. On October 29, 2021, the Delhi High Court dismissed Future Group’s plea for a stay on the arbitration tribunal. The High Court sought a response from Amazon, which had challenged the merger before SIAC, and listed the appeals by FCPL and FRL for further hearing on January 4, 2022.
Kishor Biyani and 15 others including FRL and FCPL are embroiled in a series of lawsuits with Amazon, an investor in FCPL, over the deal with Reliance. After the EA, subsequently, a three-member arbitral tribunal was constituted to decide the issues arising out of the deal.
Thereafter, the arbitration tribunal under SIAC on October 21 last year dismissed the FRL’s plea for removal of the interim stay granted by its EA on October 25, 2020, observing that the “award was correctly was given”.
FRL and FCPL had moved the apex court against the High Court order dated August 17, 2021, which had held that it would be pre-empted by its single-judge restraining FRL from proceeding with the deal pursuant to EA’s award. will implement the order.
On August 6 last year, the Supreme Court ruled in Amazon’s favor and held that the EA award, quashing the Rs 24,731 crore FRL-Reliance Retail merger deal, is valid and enforceable under Indian arbitration laws.
The top court had also set aside two orders of the division bench of the Delhi High Court order dated February 8 and March 22, 2021, which had quashed the single-judge orders that had stayed the FRL-RRL merger.
Since his retirement, a bench headed by Justice RF Nariman had dealt with the larger question and held that an award of an EA of a foreign country is enforceable under the Indian Arbitration and Conciliation Act.
(Only the title and image of this report may have been reworked by Business Standard staff; the rest of the content is generated automatically from a syndicated feed.)
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