Amazon to buy MGM, studio behind James Bond and 'Shark Tank'

New Delhi: The Delhi High Court Monday stayed a single judge’s order restraining Future Retail Ltd (FRL) from going ahead with its Rs 24,713 crore deal with Reliance Retail to sell its business, which was objected to by US-based e-commerce giant Amazon.

A division bench of Chief Justice D N Patel and Justice Jasmeet Singh also issued notice to Amazon on Future Group’s appeal challenging the single judge’s March 18 judgment on the deal by which all the objections raised by them were rejected.

“We hereby stay the order of the single judge dated March 18, 2021, till the next date of hearing,” the bench said and listed the matter for further hearing on April 30.

It also stayed the single judge order to attach assets of Future Group’s Kishore Biyani and others directing them to appear in the court on April 28.

The bench stayed the single judge’s direction imposing a cost of Rs 20 lakh on the Future Group as well as its directors, asking them to deposit it in Prime Minister’s Relief Fund within two weeks for being used for providing COVID-19 vaccination to senior citizens of Below Poverty Line (BPL) category of Delhi.

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 (EA) on October 25, 2020, restraining Future Retail from going ahead with its Rs 24,713 crore deal with Reliance Retail.

Senior advocate Harish Salve, representing Future Group, sought the court to stay all the directions passed by the single judge on March 18.

He said the division bench had earlier stayed the ad-interim order passed by the single judge earlier and it was not stayed by the Supreme Court which is also seized of the matter.

He contended that the single judge should not have passed the order as the Supreme Court is also hearing the matter and the high court’s division bench is already seized of the case.

Senior advocate Gopal Subramaniam, representing Amazon, said it would be appropriate to bring the single judge’s order to the notice of the apex court for further directions.

Since the matter is presently before the Supreme Court and listed for hearing on April 27, we will not do anything inconsistent with the Supreme Court’s order. Whatever order has been passed (by the single judge), it is implied that it is subject to the Supreme Court’s order, he submitted.

The division bench was hearing an appeal filed by the Future Group against the single judge’s order upholding the EA October 25, 2020 order restraining FRL from going ahead with its deal with Reliance Retail.

The single judge had directed Kishore Biyani-led FRL not to take further action on the deal with Reliance and held that the group willfully violated the EA’s order.

Also read: ED starts investigation against Amazon

Future Group and Amazon have been locked in a battle after the US-based company took FRL into emergency arbitration over an alleged breach of a contract between them.

The single judge had also asked Biyani and others to show cause as to why they are not detained under civil prison for a term not exceeding 3 months for violating the emergency arbitrator’s order and file a reply within two weeks.

It had directed the Future Group to approach authorities for recalling the approvals granted for the FRL-Reliance deal.

Amazon, in its interim plea, had sought to restrain FRL from taking any steps to complete the transaction with entities that are a part of the Mukesh Dhirubhai Ambani (MDA) Group.

The single judge, in an interim order, had on February 2 directed FRL to maintain the status quo in relation to its deal with Reliance. However, it was stayed by the division bench of the high court on February 8.

Amazon challenged the division bench’s order before the Supreme Court where the plea is pending. NV Investment Holdings LLC, in its plea before Justice Midha, has also sought detention of the Biyanis, directors of Future Coupons Pvt Ltd (FCPL) and FRL and other related parties in civil prison and attaching of their properties for alleged “wilful disobedience” of the emergency arbitrator’s order.

The high court, in its verdict, said Amazon invested Rs 1,431 crore solely based on the protective rights of FCPL in FRL that the retail assets of FRL would not be alienated without the US-based company’s written consent and never to a restricted person’.

Amazon has also sought to restrain Future Group from taking any steps to transfer or dispose of FRL’s retail assets or the shares held in FRL by the Biyanis in any manner without the prior written consent of Amazon.

The three domestic firms — FRL, FCPL and Reliance — however had contended that if Amazon’s claim — that it indirectly invested in FRL by investing in FCL — was accepted then it would amount to a violation of Indian foreign direct investment laws which permit only 10 per cent investment by a foreign entity in the multi-brand retail sector.

In August last year, Future had reached an agreement to sell its retail, wholesale, logistics and warehousing units to Reliance.

The EA on October 25 last year, had passed an interim order in favour of Amazon barring FRL from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party.

Subsequently, Amazon wrote to SEBI, stock exchanges and Competition Commission of India, urging them to take into consideration the Singapore arbitrator’s interim decision as it is a binding order, FRL had earlier told the high court.

Trending Stories

Latest Stories

Leave a comment

Leave a comment Cancel reply