The Supreme Court on Tuesday reserved its order on Future Group’s pleas against the Delhi High Court’s single-judge order that imposed a status quo on the Future-Reliance deal.The apex court will also decide if the matter should be sent back to the Delhi High Court for final orders.
This comes on the back of Delhi High Court’s March 2021 order that ‘stayed’ the single judge bench order restraining Future Retail Ltd from going ahead with its ₹24,713 crore deal with Reliance Retail to sell its business, which was objected to by US-based e-commerce giant Amazon.
The single judge’s order had come on Amazon’s plea seeking direction to order enforcement of the award by Singapore’s Emergency Arbitrator’s on October 25, 2020, restraining Future Retail from going ahead with its ₹24,713 crore deal with Reliance Retail.
While arguing the matter, Harish Salve, senior advocate representing Future Retail Ltd said we do not have any contractual agreement with Amazon.
Adding that Amazon invoked arbitration under an agreement that they have with Future Coupons Pvt Ltd, he asked that Future Retail should be made a party in the matter.
In an attempt to stall the deal, Amazon even went to regulatory bodies, including the competition commission of India (CCI), asking them to terminate the deal, claiming it was invalid, Salve argued.
Following this, a suit was filed by Future Retail before the Delhi court stating that Amazon was interfering in Future Retails business.
Furthermore, the senior lawyer said that Amazon, a trillion-dollar corporation, simply claimed that it would assist the company in turning around, but that it was never done in reality because Reliance was a significant competitor of the American behemoth.
Backing Salve’s arguments, Mukul Rohatgi, senior lawyer from Future Coupons mentioned that it was under tremendous pressure monetarily and that Amazon’s move to stall the deal with Reliance is severely affecting its business prospects.
Future Group said that concerning the deal, there were several approvals required to be sought from the CCI, NCLT and the shareholders’ to proceed with the deal.
It asked the apex court to allow Future to move forward by seeking the necessary approvals.
The Mukesh Ambani-led Reliance Industries’ unit agreed to buy the assets of the troubled Future Group in a ₹24,713 crore agreement struck in August 2020. Future Group would sell its wholesale, logistics, retail, and warehousing businesses to Reliance as part of the deal.
Currently, the cash-strapped Future Group’s sole chance of survival is through the Reliance acquisition.
Commenting on the matter, Sameer Jain, managing partner at PSL Advocates and Solicitors said that with so many facets open for adjudication—CCI’s cancellation, stay in Singapore Court and this matter, it will be interesting to see how the Supreme Court harmonises various open legal issues in this one decision.
Meanwhile, a division bench of the Delhi High Court on 5 January stayed Amazon’s arbitration proceedings in Singapore Tribunal against Future Group. This came after a single judge bench dismissed Future Group petitions seeking to end Amazon arbitration.
The matter will be taken up by the court on 1 February.