Delhi High Court Decision Halted the Reliance -Future Retail Deal
Reserving its order in Amazon's interim plea to stop Future Group companies and officials from relying on the approvals given by the statutory authorities in relation to the deal, a single judge bench of Justice J.R. Midha said, "Immediate orders are necessary to protect the rights of the petitioner till the pronouncement of the reserved order."
In a big relief to Amazon, the Delhi High Court directed Future Retail Ltd to maintain status quo in relation to its deal with Reliance, the Bar and Bench reported.
Reserving its order in Amazon’s interim plea to stop Future Group companies and officials from relying on the approvals given by the statutory authorities in relation to the deal, a single judge bench of Justice J.R. Midha said, “Immediate orders are necessary to protect the rights of the petitioner till the pronouncement of the reserved order.”
The court said that till the pronouncement of the order, Future Retail Ltd and other respondent parties cannot proceed any further with the deal with Reliance, the report said.
In a media statement, Future Retail Ltd (FRL) said the company, after due approval from the Competition Commission of India (CCI) and no objection from SEBI, had filed the scheme of arrangement before the NCLT Mumbai on January 26. The application is yet to be taken up by the NCLT.
“The learned single judge Justice Midha of Delhi High Court today in a petition by Amazon for enforcement of the interim award of the Emergency Arbitrator has ordered status quo with respect to the scheme of arrangement,” FRL said.
“The company is legally advised that the basis of the interim award of the emergency arbitrator has been superseded by the judgement dated December 21, 2020 passed by the learned single judge, Justice Mukta Gupta of the Delhi High Court. The company will explore all legal remedies and take appropriate steps to pursue the scheme of arrangement,” it added.
The court also clarified that all the authorities shall maintain status quo in all matters that are in violation of the emergency award passed in the Amazon-Future dispute and file a status report in this regard within 10 days.
Additionally, FRL has been directed to state all the steps and actions taken by it after the date of the Emergency Award, i.e., October 25, 2020, in connection with the deal with Reliance.
As per the report, the court further gave a prima facie finding that the Emergency Arbitrator rightly proceeded against FRL, that the Emergency Award was not a nullity, and that it was enforceable under Section 17(2) of the Arbitration Act.
It also prima facie said that the Emergency Award was appealable under Section 37 of Arbitration Act.
Amazon had moved the Delhi High Court last month for enforcement of the Emergency Award passed under Section 17(2) of the Arbitration & Conciliation Act.
It had alleged that Future Group, Kishore Biyani as well as other promoters and directors were “deliberately and maliciously” disobeying the Emergency Award in spite of their participation in the arbitration proceedings.