Tribune News Service
New Delhi, August 6
The Supreme Court on Friday ruled that Singapore’s Emergency Arbitrator (EA) award restraining the Rs 24,731 crore merger deal of Future Retail Ltd (FRL) with Reliance Retail was valid and enforceable under Indian arbitration laws.
Delivered by a Bench led by Justice RF Nariman, the verdict came as a victory for US-based e-commerce giant Amazon.com NV Investment Holdings LLC that has been fighting a bitter legal battle over the deal. Amazon wanted the EA award to be declared valid and enforceable.
The top court also set aside the February 8 and March 22 orders of a Division Bench of the Delhi High Court that had lifted the stay ordered by a single-judge against the FRL-RRL merger.
There were two issues—whether an ‘award’ by an EA under the Arbitration Rules of the Singapore International Arbitration Centre (SIAC) can be said to be an award under Arbitration and Conciliation Act and whether an order passed under Section 17(2) of the Arbitration Act in enforcement of the award of an Emergency Arbitrator by a Single Judge of the High Court was appealable.
“We…answer the first question by declaring that full party autonomy is given by the Arbitration Act to have a dispute decided in accordance with institutional rules which can include Emergency Arbitrators delivering interim orders, described as “awards”, it said in a 103-page judgment.
“Such orders are an important step in aid of decongesting the civil courts and affording expeditious interim relief to the parties. Such orders…are made under Section 17(1) of the Arbitration Act,” it added.
On the second issue, it said “that no appeal lies under Section 37 of the Arbitration Act against an order of enforcement of an Emergency Arbitrator’s order made under Section 17(2) of the Act. As a result, all interim orders of this Court stand vacated. The impugned judgments of the Division Bench, dated 8th February, 2021 and 22nd March, 2021, are set aside. The appeals are disposed of accordingly.”
The top court said an EA’s ‘award’ would undoubtedly be an order which furthers these very objectives—to decongest the court system and to give the parties urgent interim relief in cases which deserve such relief.
Kishore Biyani and 15 others including FRL and Future Coupon Pvt Ltd (FCPL) had been made parties by Amazon in a batch of petitions challenging the Delhi High Court order of the division bench which paved the way for the deal.
In August last year, the Future group had reached an agreement to sell its retail, wholesale, logistics, and warehousing units to Reliance. Subsequently, Amazon took FRL into EA before the SIAC over alleged breach of contract by the Future group.
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