Sunday, December 3, 2023

Amazon-Future deal: Delhi High Court adjourns hearing to Monday

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The Delhi High Court has adjourned the hearing into the case dealing with the dispute between e-commerce giant Amazon and Kishore Biyani’s Future Group for hearing on Monday.

“While this court would undoubtedly hear all these matters, in my considered opinion, as once there is a challenge to an order and a petition seeking enforcement, ordinarily the challenge should be taken up first,”

-the Single-Judge Bench of Justice C. Hari Shankar observed on Thursday. 

The High Court was seized of two appeals by the Future Group, challenging the arbitration tribunal’s verdict, refusing to stay the order of the Emergency Arbitrator, who had stayed its deal with Reliance.

The second was a suit filed by Future Group, seeking to restrain Amazon from interfering in its deal with Reliance. Amazon had petitioned the Court for enforcement of the order of the Emergency Arbitrator for status-quo on Future-Reliance deal as well as its petition against investigation by Enforcement Directorate’s investigation into its deal with Future Group.

Former Solicitor General Harish Salve, representing the Future Retail Limited (FRL), has argued that the arbitral proceedings were initiated by Amazon against Future Group, alleging that no prior consent of Amazon was obtained before the sale of assets of Future Retail to Reliance, even when Future Retail was not part of the Share Holders Agreement signed between Future Coupons and Amazon.

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He added that there was no arbitration agreement between FRL and Amazon. “No arbitration agreement equals nullity and if there is a nullity, I can set it up at any stage,” he said.

Pursuant to the Emergency Arbitrator’s order staying the Future-Reliance deal, the Future Group and Amazon have been in a legal tussle before the Delhi High Court, the Apex Court and various tribunals.

Amazon filed an enforcement petition before the Delhi High Court seeking enforcement of the order passed by the Emergency Arbitrator. In February last year, the Court directed that status-quo be maintained on the Future-Reliance deal, which order was confirmed in March. The order of Justice J.R. Midha had on March 18,2021 directed the attachment of Future Retail properties and those of Kishore Biyani. The judge had also imposed a cost of Rs 20 lakh on Future Retail.

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Subsequently, the Division Bench of the Delhi High Court granted a stay on the operation of this order. Against it, Amazon filed an appeal before the Apex Court which ruled in their favour. On vacation of the stay order, Future Coupons filed a Special Leave Petition before the Supreme Court, wherein in February this year, the Top Court set aside the single-judge’s order and remanded the matter back to the Delhi High Court. This comes as a relief for the Future Group in the dispute with Amazon. Future has already tied up with Reliance Retail.

Senior Advocate and former Attorney General Mukul Rohatgi is representing Future Coupons and former Solicitor General Gopal Subramanium and Senior Advocate Rajiv Nayar have been leading the case on behalf of Amazon. Senior Advocate Siddharth Luthra is appearing for Amazon in its case against ED.

The matter will next be taken up on February 28.

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In 2019, Amazon had bought 49 percent stake in Future Coupons for Rs 1,500 crore. In 2020, Reliance Retail had announced to buy the Future Group’s retail, wholesale and logistics business for over Rs 25,000 crore.

Amazon had contended that it got the first right to buy stake in Future Retail within 10 years and on this ground, it objected to the deal made by Reliance with Future Retail in 2020.

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