Supreme Court on Friday said that arbitration restraining Future Group's deal with Reliance Industries is enforceable.
In a major win for e-commerce giant Amazon, the Supreme Court on Friday said that arbitration restraining Future Group’s deal with Reliance Industries was valid and enforceable under Indian laws.
Last week, the apex court had reserved its judgment in the case about the ruling by a Singapore tribunal restraining Future from going ahead with its merger with Reliance.
A bench of Justices R F Nariman dealt with the larger question and held that an award of an EA of a foreign country is enforceable under the Indian Arbitration and Conciliation Act despite the fact that the term EA is not used in arbitration laws here.
“The EA Order is an order within section 17 (1) and can be enforced under Section 17(2) of the Arbitration and Conciliation Act,” it said.
Amazon.com NV Investment Holdings LLC and Future Retail Limited (FRL) are embroiled in a bitter legal fight over the Future-Reliance deal and the US-based firm has sought in the apex court that the EA award was valid and enforceable.
The verdict by the top court comes almost a year after Reliance Retail announced that it will be buying Future Group’s retail, wholesale and logistics and warehousing businesses by way of a slump sale for Rs 24,713 crore in August 2020.
Subsequently, Amazon took FRL into an emergency arbitration before the Singapore International Arbitration Centre (SIAC) over an alleged breach of contract by the Future group.
Amazon had first filed a plea before the high court (single judge) for enforcement of the October 25, 2020, Emergency Arbitrator (EA) award by SIAC restraining FRL from going ahead with its Rs 24,713 crore deal with Reliance Retail.
On February 8, the division bench had stayed the single judge direction to FRL and various statutory authorities to maintain a status quo on the mega-deal. The interim direction was passed on FRL’s appeal challenging the February 2 order of the single judge.
The high court division bench had said that it was staying the single judge order as FRL was not a party to the share subscription agreement (SSA) between Amazon and Future Coupons Pvt Ltd (FCPL) and the US e-commerce giant was not a party to the deal between FRL and Reliance Retail.
The high court division bench had also declined Amazon’s request to keep its order in abeyance for a week so that it can explore appropriate remedies.
-With PTI inputs
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