US e-commerce major Amazon Wednesday apprehended the “disappearance” of assets and sought an interim order from the Supreme Court to ensure the preservation of assets of Future Retail Ltd besides resumption of arbitration over FRL’s merger deal with Reliance Retail.
A bench comprising Chief Justice N V Ramana and Justices A S Bopanna and Hima Kohli took note of the allegations of the US firm that the “applecart was being upset” by its rivals and asked the Future group firms, FRL and Future Coupons Ltd (FCPL), to respond to the interim plea of Amazon seeking resumption of arbitration and preservation of assets and fixed the hearing on March 23.
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Amazon and Future group are engaged in multi-forum litigations on the issue of FRL’s merger deal to the tune of Rs 24,500 crore with Reliance Retail Ltd after the US e-commerce giant dragged the latter to arbitration at the Singapore International Arbitration Centre (SIAC) in October 2020.
It has been alleged by Amazon that on March 3, 600 stores of FRL were taken away by Reliance, the plea was vehemently objected to by the Future group lawyers on Tuesday.
The top court was told by Amazon that besides seeking resumption of arbitral proceedings, it wanted an order so that the FRL’s assets are there for it if it wins in the arbitration as the “applecart was being upset”.
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“We will hear it on March 23 and pass some orders. Meanwhile, you (Future Retail Ltd and Future Coupons Private Ltd) file the reply,” the bench told senior lawyers Gopal Subramanium and Ranjit Kumar who were appearing for the US e-commerce firm.
"We need protection from this court as we apprehend disappearance of assets (of FRL)," said Subramanium.
Initially, the bench said that if Amazon wanted some interim orders urgently then it may go to the Delhi High Court or seek reliefs from the Arbitral Tribunal on resumption of the arbitral proceedings.
“I will wait for this court,” Subramanium said.
Senior advocates Harish Salve and Mukul Rohatgi, appearing for FRL and FCPL respectively, said that they were agreeable to the resumption of arbitral proceedings.
“I agreed yesterday. We do not need further hearing,” Salve said.
The counsel for Amazon said that besides resumption of the arbitral proceedings he wanted some interim protection concerning FRL’s assets.
“I am seeking some interim protection during the pendency of arbitral proceedings given the present circumstances...Applecart is being upset now. This is why we say that pending the arbitral proceedings, these assets should not go off,” Subramanium said.
He said if Amazon loses, the merger scheme will go through and Reliance Retail will get the assets and if it wins then the assets should be there.
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The bench has now posted the plea of Amazon for hearing on March 23 as the first item.
On Tuesday, Amazon had told the bench that the talks with the Future Group to resolve the dispute over Future Retail's merger deal with Reliance Retail have failed.
Prior to this on March 3, the apex court had acceded to Amazon's request and granted 10 days to it for exploring the possibility of resolving the dispute through dialogue with the Future Group.
It is hearing Amazon's appeal against the January 5 order of the Delhi High Court, which stayed the arbitration proceedings before the arbitral tribunal over Future Retail's merger deal with Reliance Retail.
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It was alleged by Amazon that on March 3, 600 stores of FRL were taken away, but the fact is not a single store has been surrendered, Salve said. On February 9, the apex court had issued notices to Future Group firms on Amazon's plea against the high court order.
It had sought responses from Future Group firms FCPL and Future Retail Limited (FRL), and said it would hear the matter on February 23 "without any adjournment".
The fresh plea, on which the apex court issued the notice, has been filed by the US firm assailing the January 5 order of a division bench of the high court, staying the Amazon-Future arbitration.
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The division bench of the high court had also stayed a single judge's January 4 order dismissing the Future Group's two pleas seeking a direction to the arbitration tribunal to decide on its application for terminating the arbitration proceedings before moving further.
The high court had said there was a prima facie case in favour of FRL and FCPL and if a stay is not granted, it would cause an irreparable loss to them.
Amazon argued that FRL violated their contract by entering into a deal for the sale of its assets to billionaire Mukesh Ambani's Reliance Retail on a slump sale basis for Rs 24,500 crore.
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In December last year, the Competition Commission of India suspended its over-two-year-old approval for Amazon's deal to acquire a 49-per cent stake in FCPL and FRL promoter, and also slapped a penalty of Rs 202 crore on the e-commerce major.
Amazon has been objecting to the sell-off plans, accusing the Future Group of breaching its 2019 investment pact.
Future Coupons was founded in 2008 and is engaged in the business of marketing and distribution of gift cards, loyalty cards, and other reward programmes to corporate customers.
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