Following the order by the Singapore arbitration tribunal, which largely goes in its favour, Amazon.com has filed a fresh plea in the Supreme Court against the National Company Law Tribunal’s order which allowed Future Retail (FRL) to convene meetings of its shareholders and creditors for seeking approval to sell its retail assets to Reliance Retail.
Amazon has sought to restrain FRL’s proposed meetings, which are scheduled to be held on November 10 and 11. The notices for the meetings were issued by FRL on October 11. Amazon told the SC that the NCLT’s September 28 order was “in gross violation” of the apex court’s September 9 order that asked the statutory authorities, including NCLT, to put on hold all the proceedings related to the merger deal.
It said that despite this operative injunction, FRL issued the notice of meetings pursuant to the NCLT order. Further, the NCLT also dismissed Amazon’s application notwithstanding the SC’s directions to refrain from doing so, it said in its application filed in the SC.
On Wednesday, the Singapore International Arbitration Centre’s (SIAC) rejected FRL’s plea to exclude itself as a party from the ongoing arbitration proceedings that Amazon had initiated after the `24,000-crore deal was proposed between Future Group and Reliance Retail. The tribunal said that FRL is a “proper party” to the ongoing dispute between Amazon and Future Coupons and the three agreements at the heart of the Future-Amazon dispute must be read together, and not separately.
The arbitration tribunal also stated that it “has jurisdiction over FRL in this arbitration”, the stand which is in line with the Supreme Court judgment of August 6 which had held that an award of an Singapore Emergency Arbitrator (EA) is enforceable under the Indian Arbitration and Conciliation Act, while dismissing the argument put forward by FRL that an EA is not an arbitrator under the Indian law as the term does not find any mention in the statute.
“Despite pointing out that one of the transferor companies, namely FRL to the composite scheme, which is subject matter of the FRL application, is currently subject to an injunction order restraining it from transferring its retail assets contemplated in the composite scheme, the NCLT dismissed the Amazon application as premature,” Amazon’s application stated.
According to Amazon, the NCLT also disregarded the SC August 6 judgment that held that the EA Order was enforceable under Indian statutes. The NCLT order also overlooks the sanctity and primacy of the restraint orders and “gravely prejudices Amazon’s rights and contentions, the application said, adding that the NCLT order also “exposes and jeopardises the interests of third parties by permitting steps in advancement and aid of the composite scheme, which has been injuncted by the EA Order, the enforcement judgment and the Supreme Court judgment”.
The spat between Future Group and Amazon has been on since October 25, 2020, when Singapore’s EA passed an interim order restraining FRL from going ahead with its deal with Reliance Retail. Amazon, which had acquired an indirect minority stake in Future Group in 2019, has alleged that Future’s sale of its retail, wholesale, logistics and warehousing businesses to Reliance Retail breached its pre-existing contract, which included a right of the first offer and a non-compete clause.
Source: Financial Express