Amazon-Future tussle: Supreme Court bars NCLT from finalizing sanction of scheme
The Supreme Court has allowed National Company Law Tribunal (NCLT) to proceed with the in the Amazon-Future Retail case, but has directed it to refrain from passing any final order sanctioning the scheme the case.
The Supreme Court has sought response from Future Retail Limited in plea by Amazon that challenged the Delhi High Court order which had stayed the implementation of status quo direction passed by Single-Judge bench of Justice JR Midha of the Delhi High Court with respect to the Future-Reliance deal.
The Supreme Court Bench headed by Justice RF Nariman also ordered that while the proceedings before National Company Law Tribunal (NCLT) can go on, but it should not culminate in any final order of sanction of the scheme.
The Court has stated that the matter will be heard after three weeks after the rejoinders are submitted in two weeks.
Amazon had approached the Top Court challenging the Delhi High Court order which had stayed the implementation of status quo direction passed by single-judge of the High Court with respect to the Future-Reliance deal.
When a plea was filed by Amazon Inc. against the Rs. 25,000 crores deal between Future Retail Ltd. (FRL) and Reliance Industries', a Delhi High Court Single-Judge Bench headed by Justice JR Midha had granted interim relief to Amazon directing all authorities and parties to maintain status quo on the deal until a detailed interim order on the case.
Later, Future Retail moved the Delhi High Court challenging the decision and a Division Bench comprising of Chief Justice DN Patel and Justice Jyoti Singh stayed the status quo noting that there was no reason to seek a status quo before the learned Single Judge and that statutory authorities like SEBI, CCI should not be restrained from proceeding in accordance with law.
This instant plea in the form of a Special Leave Petition (SLP) was filed with the Supreme Court by Amazon contending that the Division Bench order of the Delhi High Court is illegal, and arbitrary and without jurisdiction. The plea further contended that the Division Bench of the High Court could not have heard a letters patent appeal from an order passed under Section 17(2) of the Arbitration and Conciliation Act.
It was further contended that FRL could not have preferred the Appeal before the Division Bench under Order XLIII Rule 1(r) of the CPC read with Section 13(1) of the Commercial Courts Act, 2015, thereby challenging an order issued under Section 17(2) of the Arbitration and Conciliation Act.
Amazon further contended that the Division Bench hastily passed the impugned order without waiting for the detailed order of the single-judge and without appreciating the "Group of Companies" doctrine.
According to Amazon, FRL disregarded the rule of law and that a collateral challenge to an Emergency Award cannot be permitted.
Justice RF Nariman said that the order under challenge seems to have decided the appeal finally at the interim stage. The Court therefore issued notice and stayed the NCLT proceedings. The Supreme Court, also clarified that the said matter is not before it and that it will not interfere with the same.
The Apex Court said that it will pass an order that proceedings before NCLT can continue however, no final order can be passed by the NCLT on the scheme of amalgamation.
The Court also clarified that separate proceedings before a Division Bench arising from the observations made by another single-judge of Justice Mukta Gupta in the case filed by Future against Amazon will continue.