In a big win for e-commerce giant Amazon, the Supreme Court on Friday ruled the order of a Singapore-based emergency arbitrator (EA) that restrained Future Retail Ltd (FRL) from going ahead with its asset sale deal with Reliance Retail was enforceable in India.
A Bench headed by Justice Rohinton F. Nariman upheld the single-judge Bench order of the Delhi High Court directing Future Group not to take any further action in violation of the order passed by the emergency arbitrator at the Singapore International Arbitration Centre (SIAC) on October 25, 2020.
We have framed two questions. We have answered it as - The emergency arbitrator's award under Section 17(1) and that the Single Judges order is upheld, the Bench said while pronouncing the verdict.
US-based e-commerce giant Amazon, and FRL are embroiled in a legal fight over FRL's Rs 24,713 crore asset sale deal with Reliance Retail.
Earlier, the Bench had stayed further proceedings before Single Judge and Division Bench of Delhi High Court in Amazon-Future-Reliance case.
The top court was hearing an appeal of e-commerce giant Amazon challenging the Delhi High Court's decision to stay the single bench order upholding the emergency arbitrator award.
On March 22, a Division Bench of High Court Chief Justice DN Patel and Justice Jasmeet Singh had stayed a March 18 order of Justice JR Midha ordering attachment of the assets of Future Coupons Private Limited (FCPL), FRL, Kishore Biyani, and 10 other promoters.
Amazon has been seeking enforcement of the order of the emergency arbitrator (EA) restraining FRL from taking any steps to transfer its retail assets.
Amazon has a 49 percent stake in FCPL, which in turn owns a 9.82 percent stake in FRL. Amazon's contention is that it has invested Rs.1431 crore in FCPL on the clear understanding that FRL would be the sole vehicle for its retail business and its retail assets would not be alienated without consent and never to a 'Restricted Person'.
FRL, on the other hand, has objected to the enforcement of the EA award saying that it is not an order under Section 17(1) of the Arbitration and Conciliation Act and hence not enforceable in India.
FRL has contended that the Rs 24,731 crore deal was very important to save its 25,000 employees. It had said that as per the deal, Reliance will not only take over FRL's shops but also all its liabilities.
( With inputs from ANI )
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