Future Group on Wednesday challenged the Delhi high court interim order that directed it to abide by a Singapore tribunal ruling, barring it from selling its assets to Reliance Industries Ltd.
“The petition argues that the Delhi high court does not have the authority to pass an order now to abide by the Singapore tribunal ruling since a single-judge bench of the court on 22 December had already passed a judgement on the deal,” a person directly aware of the matter said.
Mentioning the matter before a bench of Delhi high court Chief Justice D.N. Patel and Justice Jyoti Singh, Future Retail Ltd, through its counsel Darius Khambata, urged the court to urgently hear the plea on Wednesday.
Opposing the move, senior advocate Rajiv Nayyar for Amazon, told the court proper procedure should be followed.
The bench said it will decide whether to admit the Future Group appeal on Thursday after latter routes the plea through the court’s registrar.
Future Group is challenging Justice J.R. Midha’s interim order on Tuesday that directed Future Retail to maintain status quo on the assets until “the pronouncement of the reserved order”. The court said it was of the prima facie view that a Singapore tribunal order that directed the company not to proceed with the sale of its assets was enforceable in India.
The debt-laden Future Group may face bankruptcy risks if the deal with Reliance collapses. Future Group is caught in a feud between Amazon and Reliance, which are competing for dominance in India’s $1 trillion consumer retail market.
Future Group has said that livelihoods of thousands of Future Retail employees will be at risk if the deal with Reliance Industries falls through.
Amazon has, however, reiterated that it is willing to help Future Retail overcome its financial challenges.
“Contrary to reports carried in a section of the media, Amazon has not only been committed to an early resolution of the dispute with Future but continues to be willing to support Future Retail even during the temporary financial challenges posed by covid,” an Amazon India spokesperson said.
On 29 August, Future Group announced it will sell the group’s retail, wholesale, logistics and warehousing assets to two Reliance Industries’ units for ₹24,713 crore on a slump sale basis.
Amazon, which bought a 49% stake in Future Coupons Pvt. Ltd. in August 2019, has argued that Future Group’s proposed deal with Reliance Industries violates a contractual clause that bars Future Group promoters from forging an alliance with Reliance Industries without the US company’s consent. After Future Group announced the proposed deal with Reliance, Amazon approached the Singapore tribunal as per the agreement between Amazon and Future Group.
On 25 October, in an emergency arbitration award, the tribunal restrained Future Group from taking any step or approach any regulator in relation with the proposed deal with Reliance Industries until a final verdict is given.
On 22 December, the Delhi high court upheld the tribunal’s emergency award and allowed Amazon to approach any regulator.
On 5 January, both Future Group and Amazon appointed the members and the judge for the SIAC arbitration panel that is supposed to pass the final ruling.
The Delhi high court on Tuesday asked Future Retail to maintain status quo with respect to its deal with RIL. This gives an interim relief to Amazon.com Inc as it battles to prevent the Future Group’s asset sales to a rival.
