Amazon challenges Delhi HC order in SC
MUMBAI: Amazon.com Inc. has challenged a Delhi high court division bench order that allowed Kishore Biyani’s Future Group to proceed with an asset sale deal with Mukesh Ambani’s Reliance Industries Ltd (RIL).
In its plea in the Supreme Court, Amazon termed the division bench’s March 22 order as “illegal”, “random”, inequitable and unfair, requesting the apex court to prevent Amazon from suffering “irreparable” damage in its business in India. Mint has reviewed a copy of the special leave petition.
“The (Future) group had earlier unequivocally stated that they will continue to take steps to complete the impugned transaction (the ₹24,713 crore deal with RIL). The greater the progress made towards the completion of the impugned transaction, the harder it will be to unravel it. Over time, the interests of additional third parties may also become entwined with the impugned transaction and be subsequently compromised. Further, irreparable harm will be caused to the petitioner (Amazon),” Amazon’s petition filed on Wednesday evening said.
On March 22, the division bench granted Biyani a reprieve from an March 18 single-judge order of the same court that froze his assets and restrained the group he founded from taking any steps to sell its assets to RIL.
Amazon’s key objective is to prevent RIL from gaining an edge in India’s retail market by acquiring the assets of Future Group, which owns over 1,500
Big Bazaar and Fbb stores in India. If the Reliance-Future deal goes through, Amazon fears it may not be able to serve its customers with the same way as it was able to do after entering into an agreement with Future Coupons Pvt. Ltd.
Amazon agreed to buy a 49% stake in Future Coupons, a part of Future Group, in August 2019 on the condition that Future Group does not forge any alliance with RIL and 29 other entities without obtaining prior consent from the US e-commerce giant.
On March 18, Delhi high court’s justice J.R. Midha imposed a monetary penalty on Future Group for breaching the Singapore International Arbitration Centre’s (SIAC’s) October order that restrained Future Group from completing the deal with RIL. Justice Midha had also ordered the attachment of Biyani’s assets and served a show-cause on the group for his possible detention.
In an interim order following another petition filed by Amazon earlier, the Supreme Court on February 22 directed the
National Company Law Tribunal (NCLT) not to give its final approval on a scheme of amalgamation (a part of the deal with RIL) until the top court gives its final verdict.
In the latest petition, Amazon said the division bench does not have the authority to stay the March 18 single judge’s order and pass another order on the matter until the Supreme Court gives its verdict.
“Given that this Supreme Court is already seized of the matter, particularly with respect to the maintainability of an appeal against an order passed under Section 17(2) of the Act, judicial propriety demanded that the division bench should have stayed its hands, and not passed any further orders in the matter,” says Amazon’s latest petition.
Interestingly, the same argument was produced by senior advocate Iqbal Chagla, appearing on behalf of the Biyanis in March.
Amazon said if the single judge’s order is interfered with, it will reduce the SIAC order to merely a “paper order”.