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Will enforce single-judge order against FRL-RIL deal if no stay order by SC: HC Reliance-Future deal

Will enforce single-judge order against FRL-RIL deal if no stay order by SC: HC

India Blooms News Service | @indiablooms | 17 Aug 2021, 11:48 pm

New Delhi/IBNS: The Delhi High Court Tuesday said it will implement the ruling issued by the single-judge bench restraining Future Retail Ltd (FRL) from selling its retail assets for Rs 24,713 crore with Reliance Retail to sell its business, which was opposed by US-based e-commerce giant Amazon, in case no stay is obtained from the Supreme Court within four weeks.

The court said this in response to Amazon's plea for implementation of the award by Singapore's Emergency Arbitrator (EA) restraining FRL from going ahead with the deal, according reports in the media.

Justice Suresh Kumar Kait said that in the absence of any stay from the Supreme Court, he has no option but to enforce the order passed by Justice JR Midha on March 18.

“Either get a stay within 2-3 weeks on March 18 order or comply with the order. This court has no third option," the judge said, the media reports said.

The court adjourned the case for further hearing on September 17 and said if a stay order against the ruling is not received by that date, the court will have no option other than endorsing the order issued by Justice JR Midha on March 18.

Senior advocate Parag Tripathi, representing Future Coupons Pvt Ltd (FCPL) said a special leave petition has been filed in the Supreme Court.

Senior advocate Gopal Subramanium, appearing for Amazon, argued that in view of the Supreme Court's decision, Justice Midha's order was effective and has to be complied with.

Background

On August 29, 2020, Future Group had announced the sale of its retail and wholesale assets to Reliance Retail Ltd for Rs 24,713-crore.

In August 2019, Amazon had bought 49 per cent stake in Future Coupons for Rs 1,500 crore.

Amazon has alleged that the 2019 Future-Reliance deal t indirectly owned about a 3.5 per cent stake in Future Retail.

Amazon said its 2019 deal with Future Group prevents it from selling the shares of Future Retail to RIL, its biggest rival in India, as the world's biggest e-commerce platform indirectly owns about a 3.5 per cent stake in Future Retail.

On October 25, 2020, it won an injunction to halt the sale from a Singapore arbitrator that both the entities had agreed to use in case of dispute.

The Court had written to BSE and SEBI to uphold the ruling.

Later, Amazon sent a legal notice to Future Coupons over its deal with Reliance.

In January, the Securities Exchange Board of India (SEBI) cleared the Rs 24,713 crore retail asset sale of Future Group to Mukesh Ambai-led Reliance Industries with conditions.

Future Group must specifically mention the case pending before the Delhi High Court and arbitration proceedings by the global e-commerce major Amazon contesting the deal, SEBI directed while issuing the clearance in January, 2021.

The Bombay Stock Exchange (BSE) had also granted its "no adverse observation" report, it added.

"The letters issued by BSE & NSE clearly state that comments of SEBI on the "draft scheme of arrangement" (proposed transaction) are subject to the outcome of the ongoing arbitration and any other legal proceedings. We will continue to pursue our legal remedies to enforce our rights," Amazon spokesperson had said post the development.

In December 2020, the Delhi High Court quashed Future Group's petition seeking its directive restraining Amazon from interfering in the asset sale to Reliance.