Thu, 02 Dec 2021

New Delhi [India], February 22 (ANI): The Supreme Court on Monday issued a notice after hearing a petition filed by Amazon against Delhi High Court's stay on Future Reliance deal status quo.

The top court bench, headed by Justice Rohinton Fali Nariman and also comprising Justice B R Gavai, was hearing today the plea filed by e-commerce giant Amazon challenging an order of the Delhi High Court allowing statutory authority, such as National Company Law Tribunal (NCLT) to hear Future Retail Limited's (FRL) application seeking approval to complete its Rs 24,731 crore asset sale deal with Reliance Retail.

Amazon has been seeking enforcement of an order of the emergency arbitrator (EA) at the Singapore International Arbitration Centre (SIAC) restraining FRL from taking any steps to transfer its retail assets.

On Amazon's plea, a Single Judge Bench of the Delhi High Court had on February 2 ordered FRL and various statutory authorities including NCLT and Securities and Exchange Board of India (SEBI) to maintain status quo with regard to its assets sale deal with Reliance Retail.

This order was stayed by a Division Bench of the High Court on February 8 after FRL moved an appeal claiming that it would have "disastrous" consequences for the Kishore Biyani-led company if the status quo order was not vacated.

The Division Bench of the High Court had also remarked that Amazon was not a party in the asset sale agreement between FRL and Reliance Retail.

Before the Supreme Court, Amazon has contended that the "High Court failed to appreciate the fact that even though FRL was not a signatory to the Future Coupons Pvt. Ltd. (FCPL) share holding agreement (SHA), FRL is still a party to the arbitration proceedings".

"The order of the High Court is illegal, and arbitrary apart from being without jurisdiction, therefore, the same is liable to be set aside on this ground alone," Amazon's appeal stated in the top court.

Amazon had 49 per cent stake in FCPL, which in turn owns 9.82 per cent stake in FRL.

Amazon's contention is that it has invested Rs 1,431 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, including Mukesh Dhirubhai Ambani (MDA) Group.

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 said as per the deal, Reliance will not only take over FRL's shops but also all its liabilities. (ANI)

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