The Supreme Court bench of Chief Justice of India Justice N.V. Ramana, Justice A.S. Bopanna and Justice Hima Kohli 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, 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 by tomorrow with regard to the relief it’s seeking.
CJI said, we expected that some resolution to this matter could be done. But according to Mr Gopal that it was failed.
Senior Advocate Harish Salve appearing for Future Retail Limited agreed that it was ended.
Senior Advocate Mukul Rohatgi appearing for the Future Coupons seconded Salve’s opinion.
Chief Justice Ramana opined, Now the option, is whether the arbitration matter is pending before the Arbitration Tribunal in Singapore, may go on.
Salve said, 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.
CJI said, We are getting a feeling that by adjourning a matter, we are little lenient.
Amazon submitted that It a good suggestion to go to the Arbitral Tribunal. Today, milord kindly appreciate, if I go back to the Tribunal there must be something I have. They are pledging their assets to Reliance, what would remain after it.
Harish Salve said, Assets are not sold. Only boards have changed by Reliance.
Rohatgi said, The shops are already there.
CJI opined, As far as first part is concerned about the Arbitration, we all are agree to it. We will pass some orders after opening up.
Amazon’s senior Counsel Gopal said, I agree, Milord but nothing should happen till then. There must be some retrained order be passed.
Salve argued that they (Reliance) have started to take over the shops, 15 days back. Reliance have all right, to do that. I am not taking over those stores. Infact Mr Biyani went and protest it. They (Amazon) have brought us down on our knees.
CJI said, Mr Salve, We are allowing them (Amazon) to file an application.
Gopal replied, Give me liberty to file application by tomorrow.
Salve said, Milord, I may not be able to reply by tomorrow.
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.
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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.