A two-judge bench of the Delhi High Court on Monday put a stay on a single-judge bench order restraining Future Retail from going ahead with its Rs 24,713 crore deal with Reliance Retail, Bar and Bench reported. The deal between Future Group and Reliance has been contested by e-commerce company Amazon.
On March 18, a bench of Justice JR Midha directed the Kishore Biyani-led Future Retail not to take further action on the deal. It held that the group had wilfully violated an order passed by a Singapore-based Arbitrator. On October 25, Amazon had won an interim order by a Singapore court, that had put the deal on hold. Since then, the Future-Reliance and Amazon have been locked in a legal battle.
In the order passed last week, Midha had also imposed a penalty of Rs 20 lakh on Future, issued a show cause notice to Biyani and other executives associated with the company, asking why they should not be detained in civil prison. Moreover, it had directed the attachment of their properties, and ordered Biyani to file an affidavit detailing the properties and other assets owned by him.
On Monday, the two-judge bench of Chief Justice DN Patel and Justice Jasmeet Singh of the Delhi High Court put a stay on the attachment of property and the penalty as well, Bar and Bench reported. Besides, it issued a notice to Amazon on Future Group’s appeal challenging the single judge’s order.
Senior Advocate Harish Salve, appearing for Future, argued that the matter was under consideration before the Supreme Court, Live Law reported. In February, the Delhi High Court had put a stay on one of its previous decisions that had effectively blocked the deal. In that case too, a division bench had overturned the decision by a single-judge bench. Amazon had then moved the Supreme Court, challenging the stay order.
Pointing this out, Salve contended that the single judge’s March 18 order was subject to the Supreme Court’s verdict and sought to stay the restrain, penalty and attachment of property of Future Retail, Live Law reported.
Senior Advocate Gopal Subramanian, appearing for Amazon, told the bench that they will move the Supreme Court to make the single-judge bench operative. To this, Salve said that Amazon may do that, but the single-judge bench order should be stayed, Live Law reported.
“Here I am only seeking an interim stay, and the final matter will be argued in the SLP [Special Leave Petition in Supreme Court],” Salve said.
Senior Advocate Iqbal Chagla, appearing for Future Coupons, also argued that the single-judge’s order was passed in disregard of the Supreme Court’s directions, according to Live Law.
The court stayed the single-judge order till the next day of hearing on April 30. The petition in Supreme Court will be heard on April 27, Bar and Bench reported.
The case so far
The matter started in August after Future Group, led by Kishore Biyani, had agreed to enter the deal with Mukesh Ambani’s Reliance Retail, under which it would sell its wholesale, logistics, retail, and warehouse businesses. Amazon objected to the deal, arguing that according to a separate agreement it signed with a unit of Future Group in 2019, it could not sell its retail assets to a list of companies, including Reliance.
Amazon also won the Singapore arbitration panel’s order.
Following the developments, Amazon had written to the market regulator Securities and Exchanges Board of India, the stock exchanges and the Competition Commission of India, urging them to take into consideration the Singapore arbitrator’s decision as it was a binding order. It asked them to not let the deal go through.
Future Retail had then approached the Delhi High Court, seeking that Amazon should not interfere with the deal.
On February 2, a single-judge bench of the High Court directed the statutory authorities to maintain status quo on the proceedings of the deal, effectively blocking it from coming to fruition. However, the decision was overturned on February 8 by a two-judge bench of the High Court.
Amazon then approached the Supreme Court, challenging the stay.