The Supreme Court on Tuesday remanded to the Delhi High Court the Amazon- Future group dispute, asking it to hear the case afresh on merits, uninfluenced by “any observations” made in orders passed in 2021.
The dispute revolves on question of enforceability of an award passed by a Singapore-based Emergency Arbitrator (EA) which had restrained Future from going ahead with the ₹24,731 crore merger deal with Reliance Retail.
A three-judge Bench led by Chief Justice of India N.V. Ramana set aside three orders of the Delhi High Court passed last year, on February 2, March 18 and October 29, refusing to stay the EA’s award.
The Bench, on January 11, while reserving the case for orders, had orally indicated that it intended to return the case to the High Court. Both FCPL (Future Coupons Private Ltd.) and FRL had moved the Supreme Court.
One set of appeals challenged the March 18 order of the Delhi High Court which, besides restraining FRL from going ahead with its deal with Reliance Retail, had imposed costs of ₹20 lakh on the Future group and ordered attachment of their properties. The Supreme Court’s decision on Tuesday to set aside the High Court orders comes as a relief to the Future group.
The second set of appeals had been filed against a High Court order declining to stay an arbitration tribunal decision refusing to interfere with the EA award.
Senior advocates Harish Salve and Mukul Rohatgi had appeared for FRL and FCPL, respectively. They had argued that FRL would “sink with 30,000 employees losing their jobs” if the deal with Reliance did not materialise.
Amazon, represented by senior lawyers Gopal Subramanium and Ranjit Kumar, which invested in Future, had opposed the merger.
“We first sank because of a lockdown when people would not go to shops. We are in a financially precarious situation. Fortunately, banks are willing to wait and say that if a transaction goes through Reliance deal will pay off the banks. The Reliance deal is close to ₹ 26,000 crores, and Amazon's stake is ₹14,000 crores. Around 30,000 jobs will be saved. If you put this all together, let us get to that final stage. Let that final stage does not go through. Amazon's interests are not hurt,” Mr. Salve had argued in the hearing.
He had said even if eventually it was found by the courts that Reliance Industries Ltd. arm could not acquire assets of FRL, the September 9, 2021 order of the Supreme Court protected Amazon.
On September 9, the Supreme Court had stayed for four weeks proceedings before the High Court concerning the implementation of the EA and also, meanwhile, directed statutory authorities like National Company Law Tribunal, Competition Commission of India and Securities and Exchange Board of India not to pass any final order related to the merger deal.
