On Thursday, In a major relief to Future Group, the Supreme Court (SC) stayed the proceedings initiated by e-commerce firm Amazon for the enforcement of the emergency award passed in its favour by a Singapore-based arbitrator to halt the $3.4-billion merger deal between Future Retail (FRL) and Reliance Group.

The Bench of Chief Justice of India N V Ramana and Justices Surya Kant and A S Bopanna also directed the National Company Law Tribunal, Competition Commission of India, and markets regulator Securities and Exchange Board of India not to pass any final order in relation to the dispute for four weeks.

They passed the above order in a special leave petition filed by Future Coupons and FRL. It was against the order passed by the single Bench of the Delhi High Court (HC) that directed the attachment of assets of Future Group companies and its promoter Kishore Biyani and issued a show cause notice for the civil arrest of Biyani and other directors of Future Group for breach of the emergency award, according to the law platform LiveLaw.

Experts such as Manmeet Singh, Partner at law firm Saraf & Partners, said since the emergency award is the subject matter of challenge in Singapore, on an appeal filed by Future Group, the Hon'ble Supreme Court has by way of an order which was consented to by the parties, in order to balance the equities, stayed the execution proceedings pending against Future Group and restrained the regulators from passing any final order in the matter. "However, the regulators would be free to proceed with their consideration of the transaction in the meantime," said Singh.

“However, the regulators would be free to proceed with their consideration of the transaction in the meantime,” said Singh.

In August, the SC had ruled in favour of Amazon in a case that pitted the American online major against India’s original retail king Biyani’s Future Group and Mukesh Ambani’s Reliance Retail (RRL), which was set to go big on e-commerce. The ruling had put the $3.4-billion merger deal between Future and Reliance on hold.

The top court allowed the appeal filed by Amazon against a Delhi HC order, staying the attachment of properties of Future Group companies and Biyani in relation to a FRL-RRL merger worth Rs 24,713 crore ($3.4 billion).

The Bench of Justices Rohinton Fali Nariman and B R Gavai held that the order of an emergency arbitrator is enforceable in India, under Section 17(2) of the Arbitration Act.

The case centres on Amazon challenging FRL’s merger with RRL, alleging that the transaction breached an agreement with the American e-commerce firm. Amazon had cited its non-compete agreement with the Biyani-led chain. The deal specified any disputes would be arbitrated under the Singapore International Arbitration Centre (SIAC) rules.

"Nothing will happen in four weeks.

Issue notice, taking into consideration the challenge to the emergency arbitrator award is pending before the tribunal under SIAC rules," the SC noted on Thursday, according to law platform Bar & Bench.

Last year after selling his retail assets to Reliance, Future Group founder had said he had no option but to exit the business in the face of mounting debt and revenue losses, triggered by the pandemic and lockdown. Biyani said the company lost Rs 7,000 crore in revenue in the first three-four months of the pandemic phase.

Last year, the matter was arbitrated at SIAC, in which Amazon got a favourable ruling in October. FRL's representative had told the arbitration panel in Singapore that if the deal with RRL fails, then the company would go into liquidation. The closure of the company would lead to over 29,000 job losses.

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