Future agreement: The Supervisory Board has yet to decide whether the emergency arbitrator’s decision is valid, enforceable


The Supreme Court said Tuesday it would decide whether Singapore’s emergency arbitrator (EA), preventing Future Retail Ltd (FRL) from continuing its merger agreement with Reliance

Retail was valid under Indian law even if it could be enforced.

U.S. e-commerce giant Amazon.com NV Investment Holdings LLC and FRL are embroiled in a fierce legal battle over a 24,713-crore FRL merger agreement with Reliance Retail.

“We will decide whether the EA decision falls under Article 17 (1) (which deals with the interim award of the arbitral tribunal) of the Arbitration and Conciliation Act. And if the answer is yes, then can it be done according to Article 17 (2) (of the Law) “, said the bench made up of judges RF Nariman and BR Gawai.

The provisions of the Act deal with interim measures ordered by an arbitral tribunal, and Article 17 (1) states: “Unless the parties agree otherwise, the arbitral tribunal may, at the request of a party, order a party to take any interim proceedings deemed necessary in respect of the subject matter of the dispute. “

Article 17 (2) provides that the arbitral tribunal may request the party to provide adequate security in respect of a particular interim measure.

The Supreme Court’s remarks followed when senior counsel Harish Salve, appearing for the FRL, referred to the judgments on the validity and enforceability of arbitral awards and said that under Indian arbitration and conciliation law there is no term EA and, in any case, there was no arbitration agreement in that sense.

Attacking the order of one judge who gave Amazon relief by holding that the EA decision was enforceable, Salve said it was an amended amendment to the Arbitration and Conciliation Act.

“We will decide on the issue of maintenance (EA assignment) and whether the EA order has been executed,” the bench said.

There can be no arbitration until a tribunal with the power to rule is constituted, Salve said.

All arbitral awards must be enforced under the Civil Procedure Act and not under the Arbitration Act, so it cannot be said that the FRL cannot appeal to the CPC in an appeal against the EA decision and its legality, he said.

The hearing in that case will resume on Wednesday.

Earlier, Amazon told the bench that the Biyanis of Future Group had negotiated with it to enter into certain agreements and that they were bound by Singapore’s EA award which limits FRL to continue its merger agreement with Reliance Retail. It reiterated that EA’s decision was enforceable.

Kishore Biyani and 15 others, including FRL and Future Coupon Pvt Ltd (FCPL), have entertained by Amazon in a series of petitions challenging a Delhi High Court order on a department that paved the way for a deal.

On February 22, in an interim injunction, the apex court asked the National Court of Companies (NCLT) not to issue final regulatory approvals regarding the merger.

Amazon moved the trial court against the order of the division division of the High Court in Delhi, which paved the way for a Reliance-FRL deal.

On February 8, the divisional bench remained an instruction to the FRL and various legal authorities to maintain the status quo regarding the mega-deal.

An interim direction was made in the FRL appeal challenging the February 2 judge’s order.

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

Subsequently, Amazon took over the FRL in EA prior to SIAC for alleged breach of contract by the Future Group.

Amazon first filed a petition with the High Court (single judge) to enforce the EA ruling by the Singapore International Arbitration Center (SIAC) on October 25, 2020, restricting FRL from continuing the deal with Reliance Retail.

The High Court Judicial Division, however, said it remains on the order of one judge because FRL is not a party to the share subscription agreement (SSA) between Amazon and the FCPL, and the U.S. firm was not a party to the FRL-Reliance agreement.

The FRL claimed in its appeal that, if the order was not retained, it would “represent an absolute disaster” for him, because the procedure before the NCLT for approving the merger scheme was put on hold.

It argued that the status quo order would effectively remove an individual judge from the entire scheme approved by the statutory authorities in accordance with the law.

In its lawsuit before an individual judge to enforce the EA decision, Amazon sought to prevent the FRL from taking any steps to complete the transaction with entities that are part of the Mukesh Dhirubhai Ambani Group (MDA).

Amazon has also requested the detention of Biyanis, the director of the FCPL and FRL, and other related parties in a civilian prison and the admission of their property for alleged “intentional disobedience” to an EA order.

Following SIAC’s EA order, Amazon wrote to the Indian Securities and Exchange Committee (Sebi), the stock exchanges and the CCI, urging them to consider the arbitrator’s interim decision as it is a binding order.

The FRL subsequently redirected the High Court to prevent Amazon from writing to Sebia, CCI and other regulators about the SIAC order, saying it constituted an interference with the agreement with Reliance.

A single judge on December 21 last year on an FRL appeal issued a temporary injunction allowing Amazon to write to state authorities, but also noted that prima facie seems to be that the U.S. e-commerce giant’s attempt to control future retail violated FEMA and FDI rules.

Against the observation, Amazon filed an appeal before the ward bench and filed a lawsuit to enforce the EA decision during the proceedings.

Also read: The open offer of Reliance Retail Venture for shareholders of Just Dial starts on September 13

Also read: The Reliance Foundation provides over 10 easy COVID vaccines to RIL employees, family members


Like it? Share with your friends!


What's Your Reaction?

hate hate
confused confused
fail fail
fun fun
geeky geeky
love love
lol lol
omg omg
win win


Your email address will not be published. Required fields are marked *