Delhi High Court stays arbitration proceedings against Future Group

Delhi High Court stays arbitration proceedings against Future Group

It maintained that an irreparable loss would be caused to the company

The Delhi High Court has provided relief to Kishore Biyani and his company Future Group. It has stayed the 2019 arbitration proceedings and its deal with Amazon before the Singapore Arbitration Tribunal.

A division bench of Chief Justice D N Patel and Justice Jyoti Singh also stayed the order of the single judge refusing to intervene in the matter. It dismissed the pleas filed by the two subsidiaries of the Future Group.

The court said that looking at the facts, the circumstances of the case and the order passed by the Competition Commission of India (CCI), there was a prima facie case in favour of the Future Group. An irreparable loss would be caused to the company if the proceedings were not stayed.

The court issued a notice to Amazon and said that the stay on arbitration proceedings as well as the single judge's order would remain in force until the next month. It stated that it would later deal with the arguments raised by the respondents, including on the maintainability of the appeals.

An arbitration tribunal in Singapore had been hearing the Amazon versus Future Group deal. The tribunal had passed an interim order stalling the sale of Future Retail's assets to Reliance Industries. Future Retail had then petitioned the tribunal arguing that continuing proceedings there would be illegal in view of the CCI ruling against Amazon.

The CCI had suspended the clearance from the deal stating that Amazon had failed to notify it about certain crucial details of its acquisition of a 49 percent stake in Future Retail, as required under the Competition Act, 2002. It had, therefore, imposed a penalty of Rs.202 crores on Amazon.

Since the tribunal refused to consider the request before starting a final hearing, the Future Group moved the Delhi High Court. However, Justice Amit Bansal dismissed the plea holding that there was no evidence to suggest that the tribunal denied equal opportunity to Future Group or that it had not been accommodating towards their requests.

Subsequently, the appeals were filed before the division bench. Amazon argued that the appeals were not maintainable since the order passed by the single-judge was under the Constitution of India, wherein no intra-court appeal lied. It also informed the court about challenging the order of the CCI.