The Supreme Court on Friday ruled in favour of ecommerce giant Amazon by holding that Singapore’s Emergency Arbitrator (EA) award, restraining the Rs 24,731 crore merger deal of Future Retail Ltd (FRL) with Reliance Retail, was valid and enforceable under Indian laws.
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 FRL are embroiled in a bitter legal fight over the deal and the US-based firm has sought in the apex court that the EA award was valid and enforceable.
Amazon had first filed a plea before the high court (single judge) for enforcement of the October 25, 2020, EA award by Singapore International Arbitration Centre (SIAC) restraining FRL from going ahead with the deal with Reliance Retail.
The high court division bench had however said that it was staying the single-judge order as FRL was not a party to the share subscription agreement (SSA) between Amazon and FCPL and the US firm was not a party to the FRL-Reliance deal.
FRL, in its appeal, had claimed that if the February 2 order was not stayed it would be an absolute disaster for it as the proceedings before the NCLT for approving the amalgamation scheme have been put on hold.
It had contended that the single judge’s status quo order will effectively derail the entire scheme which has been approved by statutory authorities in accordance with the law.
In August last year, the Future group had reached an agreement to sell its retail, wholesale, logistics, and warehousing units to Reliance.
Subsequently, Amazon took FRL into EA before the SIAC over alleged breach of contract by the Future group.
(Disclaimer: Additional background information has been added to this PTI copy for context)
