The Supreme Court of India (SC), on February 22, allowed the National Company Law Tribunal (NCLT) to continue its proceedings in the Amazon versus Future Group case but restrained it from passing any final order.
The SC has issued a notice to Future Retail (FRL) on Amazon’s plea seeking status quo. Earlier this month, Amazon had moved the SC, challenging the lifting of ‘status quo’ orders on the FRL–Reliance Retail stake sale deal of nearly Rs 25,000 crore by the division bench of the Delhi HC.
The SC had initially proposed to issue notice and stay the NCLT proceedings, to which FRL’s legal representative, senior advocate Harish Salve, informed the court that the Delhi HC hearing is due on February 26.
He further said that FRL’s meeting is “a first-step meeting where everyone else has appeared. That is six weeks away. Staying NCLT proceedings will only stay meeting for six weeks.”
“Reliance is calling its own meeting, FRL is coordinating shareholder meeting separately. Nothing will happen as shareholder meeting will take six weeks,” Salve added.
Amazon’s legal representative, senior advocate Gopal Subramanium, pointed out that these meetings were taken in violation of the arbitrator's order, Live Law reported.
Taking this into consideration, the SC observed that NCLT proceedings may be allowed without any final orders being issued. “We have read every page and know exactly what’s happening. We don’t wish to reveal it now. We are not commenting on merits here,” it said.
The SC’s final order stated: “We issue notice to come up after three weeks after the rejoinder is filed within two weeks. Meanwhile, NCLT proceedings allowed to go on but not to culminate into any final order of sanction of schemes.”
The bench further clarified that this order “has not been made in terms of the status quo order by the High Court’s Single Judge Bench.”
Meanwhile, the Delhi HC, on February 22, adjourned its hearing in Amazon's appeal against the single-judge bench order on Reliance-Future Retail stake sale deal to March 18, Live Law reported.
Future Group had moved the NCLT in January 2021, seeking approval to complete its deal with Reliance Retail. The NCLT hearing was initially stayed by the Delhi HC, but allowed by a division bench on appeal by Future.
Future approached the tribunal after it locked horns with Amazon over alleged breach of contract and the US retail giant’s right of first refusal which bars share sale to firms such as Reliance Retail.
Amazon then petitioned the HC, seeking enforcement of the arbitrator’s award restraining Future Retail from going ahead with the deal, and then the SC, when the Delhi HC division bench granted relief to Future.Disclaimer: Reliance Industries (RIL) is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd, which publishes Moneycontrol.