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Business News/ Companies / News/  Future-RIL deal: Delhi HC restrains 24,713-cr acquisition, upholds SIAC order
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Future-RIL deal: Delhi HC restrains ₹24,713-cr acquisition, upholds SIAC order

HC holds that Future Retail 'willfully violated Singapore Arbitrator's order'
  • The HC directed attachment of properties of Kishore Biyani and others related to Future Group
  • Future Group has 1,500 Big Bazaar and fbb stores in India.Premium
    Future Group has 1,500 Big Bazaar and fbb stores in India.

    Delhi High Court on Thursday maintained its position in the Amazon versus Future Group case and told Future Retail not to take further action on its 24,713-crore Reliance deal.

    The single-judge bench today held that Future Retail "wilfully violated Singapore Arbitrator's order."

    The HC directed attachment of properties of Kishore Biyani and others related to Future Group. The high court directed the Future Group and its directors to deposit 20 lakh cost in Prime Minister's Relief Fund for providing COVID-19 vaccines to senior citizens of Below Poverty Line (BPL) category.

    The court directed the presence of Biyani and others before it on April 28 as also attachment of their properties.

    The high court asked them to show cause as to why they be not detained for 3 months under civil prison for violating emergency arbitrator's order.

    The Delhi High Court on February 8 had stayed its single-judge direction to FRL and various statutory authorities to maintain status quo on the mega deal. The interim direction was passed on FRL's appeal challenging the February 2 order of the single judge.

    The high court division bench had also declined Amazon's request to keep its order in abeyance for a week so that it can explore appropriate remedies.

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

    Subsequently, Amazon took FRL into an emergency arbitration before the Singapore International Arbitration Centre (SIAC) over an alleged breach of contract by the Future group.

    Amazon had first filed a plea before the high court (single judge) for enforcement of the October 25, 2020 Emergency Arbitrator (EA) award by SIAC restraining FRL from going ahead with its deal with Reliance Retail.

    The high court division bench however said that it was staying the single judge order as FRL was not a party to the share subscription agreement (SSA) between Amazon and Future Coupons Pvt Ltd (FCPL) and the US e-commerce giant was not a party to the deal between FRL and Reliance Retail.

    After the SIAC's EA order, Amazon wrote to the Securities and Exchange Board of India (Sebi), stock exchanges and CCI, urging them to take into consideration the arbitrator's interim decision as it is a binding order.

    FRL thereafter moved the high court to restrain Amazon from writing to Sebi, CCI and other regulators about SIAC's order, saying it amounts to interfering with the agreement with Reliance.

    A single judge on December 21 last year had on FRL's plea passed an interim order allowing Amazon to write to the statutory authorities, but also observed that prima facie it appeared the US e-commerce giant's attempt to control Future Retail was violative of FEMA and FDI rules.

    Against the observation, Amazon moved an appeal before a division bench and during its pendency, it filed the suit for the enforcement of the EA award.

    In a later development, Amazon moved Supreme Court to challenge the RIL-Furture deal. Last month, the Supreme Court Monday asked the NCLT not to pass the final order the deal as it agreed to hear Amazon's plea against the Delhi High Court verdict staying its single judge directive to maintain status quo on the deal.

    During the brief hearing, the apex court proposed to pass an order to stay the proceedings before the National Company Law Tribunal (NCLT). The Future group had moved the tribunal seeking regulatory approvals to the 24,713 crore deal with Reliance.

    Senior advocate Harish Salve, appearing for the Future group, said however that the top court's stay order will prolong the proceedings by the NCLT by at least six weeks.

    Recording his submission, the bench said, "In the meantime, the NCLT proceedings will be allowed to go on but will not culminate in any final order of sanction of scheme (on amalgamation of FRL with Reliance)."

    A bench comprising Justices R F Nariman and B R Gavai issued notices to FRL, Chairperson Kishore Biyani and others and sought their replies to the Amazon plea.

    "Issue notice... Counter Affidavit be filed within two weeks. Rejoinder Affidavit, if any, be filed within one week thereafter. List after three weeks," the bench said in its order.

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    Published: 18 Mar 2021, 05:43 PM IST
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