SC upholds S’pore court order on Future-ril deal
NEW DELHI: In a major victory for e-commerce giant Amazon, the Supreme Court on Friday ruled that Future Group is bound by an emergency award that restrains it from a $3.4 billion sale of retail assets to Mukesh Ambani’s RIL.
A bench of justices Rohinton F Nariman and BR Gavai held that the Singapore-based EA award, passed in October 2020, was enforceable under Indian arbitration law, and will bind the Kishore Biyani-led group of companies to pertinent agreements with Amazon.
“A party cannot be heard to say, after it participates in an Emergency Award proceeding, having agreed to institutional rules made in that regard, that thereafter it will not be bound by an Emergency Arbitrator’s ruling,” said the bench, while allowing the petitions filed by Amazon, which is engaged in a legal wrangle with RIL for domination of the Indian retail market.
In its 103-page judgment, the top court noted that “it cannot lie in the mouth of a party to ignore an Emergency Arbitrator’s award by stating that it is a nullity when such party (Future Group) expressly agrees to the binding nature of such award from the date it is made and further undertakes to carry out the said interim order immediately and without delay.”
The case was about Future’s decision to sell its assets to Reliance; Amazon contended that it violated the former’s 2019 contract with it. The Singapore EA agreed, restraining Future from going ahead with the deal, even as it went about the arbitration proceedings. The top court’s order upholds that ruling.
Underlining that the Future Group agreed to the Singapore International Arbitration Centre (SIAC) Rules and participated in the proceedings before it, the bench held that no party can turn around after losing and say that the award is a nullity or coram non judice (not before a proper judge) when there is nothing in the Arbitration Act which interdicts an Emergency Arbitrator’s order.
The court, referring to a body of Supreme Court judgments, accepted Amazon’s argument and said that an Emergency Arbitrator’s award will be a valid award within the contemplation of the Arbitration Act, and has to be held as an order under Section 17(1) of the Act (for passing interim reliefs).
An Amazon spokesperson said: “We welcome the verdict of the Hon’ble Supreme Court of India upholding the Emergency Arbitrator’s award. We hope that this will hasten a resolution of this dispute with Future Group.”