The Supreme Court today said it will hear and pass orders on March 23, 2022, in an application filed by Amazon seeking resumption of Arbitration Tribunal hearing and also an injunction on Future Retail from transferring its assets to Reliance Industries Limited.
Amazon’s Senior Counsel Gopal Subramonium apprised the three-judge bench led by the CJI NV Ramana that he has filed an application seeking interim protection against transfer of assets.
“I have no problem if the tribunal takes up the Section 32 application first. but if the application is not entertained, then the final hearing should be completed. We need some interim protection.”
CJI replied, I think we cannot consider all reliefs now. You have to wait, otherwise move the High Court for seeking relief. On 23rd March, I will hear and pass some orders.
Sr Adv Ranjit Kumar said, We could request the Arbitration Tribunal to hear the matter.
CJI asked, Is the Arbitration Proceedings going on?
Ranjit answered, No Milord.
CJI asked Harish Salve, is the tribunal has given some dates?
CJI suggested, Why don’t mention before the Tribunal to proceed before the Tribunal.
Salve replied, I don’t know what the application is about? I don’t know why my friend is hustling.
CJI said, See it’s for your advantage. Let the proceedings shall start.
Salve replied, I agreed yesterday Milord, that we will, but after this Court order in this present SLP.
Senior Counsel Mukul Rohatgi for Future Coupons, submitted, Lordships May recall that this entire dispute because of the order of the High Court wherein we have challenged the order of arbitration Proceedings.
Amazon’s counsel Gopal said, I have no difficulty if the arbitration tribunal is to take up the Section 32 proceedings. We have sought some interim relief in the application we have filed today, milord.
CJI asked, Mr Gopal why don’t you seek the relief before the Tribunal?
Gopal said, Tribunal has already given us a relief. If I were to lose, the scheme will go through and the reliance can take over. But assets must be there, what would left for me if Reliance took over before order of the Tribunal.
Salve submitted, He has applied for enforcement order yesterday in the high court. That is listed on Tuesday.
Justice AS Bopanna suggested, if the arbitration proceeds that will be the enter of this matter.
Rohatgi said, that is precisely the contours of this case what milord has just observed.
Justice AS Bopanna observed, if he (Amazon) has to seek a interim relief then he can seek it before the Arbitration Tribunal.
Gopal replied, here I am just because of the order of the Arbitration Tribunal passed in 2020 Milord, what would be a reason to go again before the Tribunal to seek a interim relief. That is the point. How can I deal with the situation in which the Assets disappeared? If your lordships are permitting to resume proceedings before the Arbitration Tribunal then atleast protect us.
CJI opined, it’s little difficult, we will hear on March 23, and pass some order. Respondents (Future Retail and Future Coupons) are directed to file their reply.
The matter would now be heard on Marcy 23, 2022.
Yesterday, the bench was informed by senior counsels appearing for Amazon and Future Retail that negotiation to end the long-standing disputes between them have failed.
Senior Advocate Gopal Subramonium, appearing for Amazon, had informed the bench that last time the Court has adjourned the hearing for ten-days giving a window to us for settlement talks. But within three days after the order was passed on March 3, the Reliance started taking over the Retail stores owned by Future Retail. He argued that Top Courts order have been violated.
“Your lordships adjourned it on the March 3. I previously requested that NCLT proceedings may go on, but the assets must not be taken over. Now the Reliance is taking over stores of Future Retail. It is in public domain. On March 3, Lordship’s pass the order and on the 6/03/2022, the Stores were taken over by the Reliance. If orders of a court violated this way, where do we go. Your lordship have said that HC will not be influence by this court order”
The Court has granted liberty to Amazon to file an application with regard to the relief it’s seeking.
Salve had submitted, Nothing has been transferred as what argued by Amazon, the rents have not been paid for two years, we have no money to pay to landlords. Future, which has over 1,700 stores, including the prestigious Big Bazaar stores, had failed to pay lease rentals for several of its stores. This is because the company is deep in losses and has even fallen behind on loan payments. Amazon has broken us completely, we have no money to pay which is owe to Reliance. Reliance is taking over the stores as a sub lease. When we are broke, means we are broke, toady we have been strangulated.
The bench was hearing a petition filed by Amazon, challenging the Delhi High Court order, which had stayed further proceedings before the Arbitral Tribunal in Amazon NV Investment Holdings LLC vs Future Coupons Private Limited, SIAC Arbitration of 2020.
Previously, the Court on March 3, had agreed with the contentions of Amazon and Future to resolve the dispute amicably amongst themselves through an informal dialogue and adjourn the matter for 10 days.
The Top Court had noted in its order,
“We have taken into submission that proceedings before the Delhi HC, NCLT and NCLAT is going on and will take some time. Gopal Subramanium submitted that for informal talk, he needs some time. For the next 10 days, the Delhi High Court, the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT) will not pass any orders. The matter will now be heard on March 15, 2022.”
On January 5, 2022, a Division Bench of Delhi High Court stayed the arbitration proceedings between Amazon and Future.
Previously, the Supreme Court had asked NCLAT to expeditiously hear the appeal by E-commerce major Amazon challenging the order of the Competition Commission of India (CCI) that suspended the over-two-year-old approval for its deal with Future Coupons Pvt Ltd (FCPL).
In December, the fair trade regulator had suspended the 2019 approval for Amazon’s deal to acquire a 49-per cent stake in Future Coupons Pvt Ltd (FCPL), FRL’s promoter, while slapping a penalty of Rs 202 crore on the e-commerce major.
On last hearing, the Bench led by the CJI NV Ramana has opined it it would be easier to decide the dispute relating to Amazon’s objection to Rs 25,000 crore FRL-Reliance deal. Amazon and Future group agreed to request NCLAT for expeditious decision on appeal against CCI order.
Amazon claims Future’s contractual obligation of a 2019 deal in which the US e-commerce conglomerate invested $200 million in a Future Group subsidiary. A Singapore arbitrator has backed Amazon’s position.