Future wins stay against Delhi HC judge’s order on Amazon arbitration

On February 8, 2021, the division bench of the Delhi High Court stayed the operation, implementation and execution of the “status quo order” passed earlier by the single judge of the Delhi High Court in the dispute. (Image: Pixabay)

The Delhi high court judge who ruled against Future Group in its dispute with Amazon erred in making his sweeping order, Future’s senior counsel Harish Salve argued on Monday as he won a stay for the Mumbai-based retailer. Justice JR Midha travelled beyond his scope and passed mandatory directions against Future and its promoters, Salve told a division bench.

“In the light of the fact that Supreme Court has allowed the NCLT proceedings can go on, Justice Midha could not have passed any orders directing the appellants to write to statutory authorities to recall the approvals already granted and bring the NCLT proceedings to a halt,” Salve argued.

The division bench of the Delhi High Court stayed an earlier order passed by a single bench which had ruled against the Kishore Biyani-led Future Group, offering a breather to the company, which is embroiled in a legal tussle with Amazon. The stay will operate until the next hearing, which has been fixed for April 30, 2021.

The single bench order passed by Justice Midha on March 18, 2021 had ruled that Future Retail and related parties had violated the Singapore emergency arbitrator’s award which had restrained Future Retail from going ahead with its Rs 24,713 crore deal with Reliance Retail. It also directed attachment of assets and issued a notice to the promoters of Future Group to show cause why they be not detained in civil prison for a term not exceeding three months.

Additionally, the order directed Future Retail and related parties to approach all the competent authorities for recall of the orders passed on their applications in violation of the interim order dated 25th October 2020 within two weeks. The competent authorities include bodies like Sebi and NCLT.

Importantly, Future Group urged that the Supreme Court had only directed that NCLT proceedings will be allowed to go on but will not culminate in any final order of sanction of the scheme. Meanwhile, Amazon’s counsels pressed for not granting a stay on the ground that Supreme Court is seized of the matter.

“NCLT can continue to hear the scheme as per the directions of the Supreme Court but no final orders can be passed until the Supreme Court decides on the petition filed by Amazon,” Future said in a statement.
The Supreme Court will hear a special leave petition filed by Amazon in the case involving the Future Retail-Reliance Industries deal in the last week of April, 2021. Amazon had filed a special leave petition at the apex court challenging an order of the division bench dated 8th February.

On February 8, 2021, the division bench of the Delhi High Court stayed the operation, implementation and execution of the “status quo order” passed earlier by the single judge of the Delhi High Court in the dispute.
The genesis of the ongoing litigation lies in an emergency order of the arbitrator which had ruled in favour of Amazon.

On January 25, 2021, the US firm had sought to enforce the emergency order which it had won against the Future Group by preferring an application before a single judge of the Delhi High Court.

The single judge on February 2, 2021 had passed an ad-interim order inter alia restraining Future Retail Limited (FRL) from taking any steps in furtherance of the scheme of amalgamation with Reliance Industries.

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