Future told to halt asset sale process

“We cannot allow you to do anything in the meantime. We are very clear about it. Where is the question of your filing suits and SLPs (special leave petitions), and in the meantime, you keep going ahead? What remains then? We hope you don’t proceed,” a bench, headed by Chief Justice of India N.V. Ramana, told lawyers representing Future Group.

“If you go on doing everything, what remains to be finally decided? If meetings, etc., go on, nothing remains. On the other hand, you can buy your own sweet time and go on filing appeals, suits, etc.,” the bench, which also comprised justices A.S. Bopanna and Hima Kohli, said.

The bench reiterated that the apex court on 9 September passed an order by consent of both Amazon and Future Group to bar the Delhi high court, regulators and other statutory authorities in the country from passing any effective order on the Future-Reliance deal for four weeks. “That was an order passed after both of you agreed. We hope you don’t do anything now and will not proceed,” the bench told senior counsel Parag P. Tripathi, who appeared for Future Group.

Future told to halt asset sale process

After Tripathi assured the court that Future Group would not take steps to precipitate the matter, the bench further asked him to take an adjournment before the National Company Law Tribunal (NCLT), where Future Group has pressed for convening meetings of its shareholders and creditors to seek approval on a sale proposal of the retailer’s assets to Reliance.

The court fixed the matter for a detailed hearing on 17 November when it would also take up Future Group’s petition against the Delhi high court’s refusal to stay the Singapore arbitration tribunal’s 21 October ruling. The Singapore International Arbitration Centre (SIAC) restrained Future Group from proceeding with its deal with Reliance. The high court on 29 October issued notice on Future’s petition fixing the case for a hearing on a later date but declined to stay SIAC’s interim order in the meantime.

On Thursday, the bench was hearing Amazon’s plea to restrain all authorities, including NCLT, from allowing any measure that may facilitate the Future-Reliance deal till the matter is finally decided by the top court.

Senior advocate Ranjit Kumar, appearing for Amazon, cited Future Group’s attempt to conduct a shareholders’ meeting and creditors for approval to sell its retail assets to Reliance, requesting the bench to issue a restraining order.

Tripathi argued that the process of holding meetings takes between 35-40 days, and there is nothing that is happening currently.

The bench, however, said SIAC’s order is binding on Future Group, as was also held by the Supreme Court’s judgement on 6 August and, therefore, the retailer should choose its remedies in terms of this verdict.

As Tripathi said the Delhi high court is reluctant to pass any order in view of the top court’s interim restraining order on 9 September, the bench said it had not prevented the high court from examining the case on merit, but the interim order was confined only on the aspect of coercive steps against Future Group’s directors.

“We have not stayed everything. We never prevented the Delhi high court from adjudicating the matter. We only issued certain clarifications about (high court) orders on the attachment of assets, etc.,” observed the bench, adding it would pass appropriate orders when it hears the case on the next date. The court also issued a formal notice to the Future Group on Amazon’s plea.

On 9 September, the bench restrained Delhi high court from passing any adverse directive against Future Group’s proposed sale of assets to Reliance or attaching the assets of Future group chairman Kishore Biyani and other directors. This order was passed in view of the fact that Future has approached SIAC for vacating the tribunal’s October 2020 order, which had imposed a status quo on the transaction between Reliance and Future.

At the same time, the top court restrained other authorities, including the National Company Law Appellate Tribunal, Competition Commission of India and Securities and Exchange Board of India, from approving any scheme facilitating the Future-Reliance deal.

The legal battle between Amazon and Future could well decide the future of the Indian retail landscape.

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