Read Time: 07 minutes

A division bench of Chief Justice DN Patel and Justice Jyoti Singh of the Delhi High Court today stayed Future Group's arbitration proceedings with Amazon Inc in light of an order by the Competition Commission of India (CCI) finding Amazon to have suppressed strategic details about its deal with Future Coupons Pvt Ltd (FCPL). 

The bench said that the balance of convenience is in favour of Future Group as not granting it ex-parte ad interim relief and staying the arbitration would result in irreparable loss to the group. It also said that there is a "prima facie case in favour of Future Group" in the backdrop of the CCI order.

The bench has issued notices on the pleas returnable on February 1.

Future Retail Ltd (FRL) and FCPL moved the Court in a Letters Patent Appeal against a Single Judge bench order which had dismissed the pleas seeking termination of the ongoing arbitration proceedings with Amazon Inc.

The impugned order was passed by a bench of Justice Amit Bansal. 

Earlier, Senior Advocates Harish Salve and Mukul Rohatgi had mentioned the plea for an urgent hearing before the Division Bench of Chief Justice DN Patel and Jyoti Singh citing that the Arbitral Tribunal was scheduled to hear the matter on January 5.

As such, a single-judge bench of Justice Amit Bansal had taken up the case for hearing on late-Monday afternoon.

Kishore Biyani’s Future Group had approached the Tribunal as well seeking termination of ongoing arbitration before the Delhi based Tribunal, however, the request was not accommodated by it.

According to Rohatgi, appearing Future Coupons Pvt Ltd, the Tribunal, citing its busy schedule had agreed to accommodate Future Group’s plea for termination of proceedings after carrying out the main hearing in the case between January 5 and 7 on the issue of damages to be ascertained.

Rohatgi pointed out to the Court that the Tribunal's decision was in the teeth of the CCI's order suspending the deal - and in complete defiance of the order of an Indian authority.

The Future Group pressed that with CCI approval for the 2019 deal suspended, the investment deal is rendered invalid and the arbitration proceedings arising from the same cannot stand.

Rohatgi termed the arbitration proceedings “futile” and “irrelevant” in light of the CCI order, though the CCI has merely kept approval for the deal in abeyance and has not quashed it yet.

CCI did, however, note in its order that Amazon had hidden important strategic information while seeking approval for its investment in Future Coupons Pvt Ltd.

Amazon was also granted time by CCI to make fresh application for approval following which the Commission will reconsider the approval for the deal.

Sr. Adv. Gopal Subramanium representing Amazon on the other hand argued that as arbitration clauses and agreements are independent of main contracts, the arbitration would not perish simply because a regulatory approval has been suspended.

Subramanium also defended the Tribunal to say that the Tribunal did not reject Future Group’s plea to hear the termination application altogether but had merely agreed to accommodate hearing on the application after the scheduled hearings.

The Rs. 24,000 cr stake sale between Future Group and Reliance Industries was stayed by an Emergency Arbitrator in October 2020, and the validity of this order was affirmed by the Supreme Court in August 2021.

Cause Title: Future Retail Ltd vs Amazon.com NV Investments Holdings LLC & Ors