Amazon approaches SC against Delhi HC order restraining Future Retail's deal with Reliance

On Wednesday, April 14, Amazon moved to the Supreme Court against the order passed by Delhi High Court. This order disallowed Future Retail Ltd. (FRL) to sell its business to Reliance Retail in a deal of Rs. 24,713 crore. Kishore Biyani - led FRL told the Delhi High Court on February 4 that Amazon was opposing the Rs. 24,713 crore deal with Reliance as the Mukesh Ambani led company was a competitor, a contention denied by the US-based e-commerce giant which was interested in salvaging FRL. 

The FRL informed the stock exchanges saying, "the company's advocates are in receipt of communication dated April 13, 2021 from advocates of Amazon.com NV Investment Holdings LLC informig that Amazon has filed a Special Leave Petition (SPL) before the Supreme Court of India against the captioned order dated March 22,2021 passed by the Division Bench of the High Court Of Delhi." FRL also said, "will defend the matter and proceedings through our legal counsels."

A single judge had stayed the order restraining FRL to deal business with Reliance Retail. The Future Group includes brands like Big Bazaar, a well known departmental market chain in India. Amazon in 2019 had invested in the Group giving the international e-commerce giant about 4.8% stakes in FRL. According to Amazon and filings by them, this deal with FRL powered rights on Amazon to refuse further acquiring of shares in the Future Group.

In the wake of pandemic due to COVID-19 and imposing strictest nationwide lockdown, banning shops and stores to function, had caused an adverse impact on businesses of Future Group. In July 2020, Reliance and the Future Group announced that former was buying the latter. To this, Amazon had responded by filing a complaint before the Singapore International Arbitration Centre (SIAC).

'Future Group breached the contract': Amazon

Previously, a division bench of Chief Justice D N Patel and Justice Jasmeet Singh had issued a notice to Amazon upon an appeal by FRL challenging the single judge order dated March 18. The bench had ordered to attach assets of Kisore Biyani-led Future Group and others. The bench also stayed the order by single judge imposing a cost of Rs. 20 lacs on Future Group and its directors. The bench asked to deposit the amount to Prime Minister's Relief Fund for aiding and providing COVID-19 vaccination to senior citizens of 'Below Poverty Line' (BPL) category in Delhi.

The aforementioned order had been passed on the international business tycoon's plea that sought directions to enforce the arbitral award by SIAC. The award was in favour of Amazon. Thus, restricted FRL to execute Rupees 24,713 crore deal with Reliance Retail. Amazon at SIAC argued that FRL had breached the contract by agreeing to sell its retail, wholesale, logistics and warehousing units to Reliance.