Amazon- Future Disputes: Delhi High Court To Commence Hearing On February 24

The Delhi High Court on Friday said that it will commence hearing in a bunch of pleas pertaining to disputes between Amazon and Future Group, over the latter's deal with Reliance Retail, on February 24.

A single judge bench comprising of Justice C Hari Shankar said that it will first be hearing the appeals filed by the Future Group and then proceed to hear other matters.

While noting the possible and relevant issues between the parties, the Court clarified that it was only jotting out the facts to ascertain the manner in which hearing in the pleas are to be commenced. 

The Judge added that it had not even tentatively applied its mind while doing the same and that it has not expressed any opinion on the issues between the parties.

Recently, the The Supreme Court had set aside the orders dated 02.02.2021 and 18.03.2021 passed by a single judge of the High Court ordering coercive steps against Future group and the order dated 29.10.2021 which refused to stay the Singapore Arbitration Tribunal's refusal to vacate the Emergency Award which restrained Future's deal with Reliance.

The Supreme Court had then remanded the matters to the Delhi High Court.

A Bench comprising Chief Justice of India NV Ramana, Justice AS Bopanna and Justice Hima Kohli had delivered its judgement in the following two pleas:

- Special Leave Petitions of Future Coupons Private Ltd and Future Retail Ltd against Delhi High Court's Single Bench March 2021 order directing attachment of assets of Future group companies and its promoters for breach of Emergency Award (order passed by a single bench of Justice Midha). In the order dated 18.03.2021, Justice Midha confirmed the earlier order dated 02.02.2021 which directed status quo on FRL-Reliance deal.

- Special Leave Petitions of both FRL and FCPL challenging Delhi HC's 29th Oct order which refused to stay the Singapore Arbitration Tribunal's refusal to vacate the Emergency Award restraining it to continue with Reliance deal.

The Court is also hearing a petition filed by Amazon Wholesale India Pvt. Ltd., challenging the jurisdiction of the Directorate of Enforcement to investigate matters beyond the scope of powers prescribed under the Foreign Exchange Management Act (FEMA).

The dispute involves Amazon Wholesale India Pvt. Ltd, Amazon.com NV Investment Holdings LLC, Future Coupons Private Limited, Future Retail Ltd. and the Enforcement Directorate of India.

Last week, the Supreme Court had directed the High Court to hear the matter afresh, on merits. It had also set aside two High Court orders directing initiation of coercive steps against Future group for alleged violation of the Emergency Award passed by the Singapore Tribunal on the application filed Amazon.

Calling it a fishing and roving investigation, Amazon had claimed that ED had issued various summons to its employees for a transaction that is entirely unconnected. It was further stated that the ED had sought the legal advice and privileged legal opinions that have been received from time to time by Indian subsidiaries of Amazon.com, Inc in India.

Referring to the dispute between Amazon NV and Future Group, the plea stated that a directive was received by Amazon India from the ED seeking information about the Arbitration and matters which were already being investigated by the Bangalore Regional Office of ED.

The petitioner's case is that 10 out of the 16 documents sought in the directive pertained to the transaction with the Future Group and Amazon NV and not Amazon India and Amazon Seller Services Private Limited.

Accordingly, it was submitted that the said directive was addressed to and received by Amazon India, who had nothing to do, directly or indirectly, with the Future Group or Amazon NV's investment in the Future Group.

"As stated in the summons, while the investigation relates only to the the "Future Group," the ED is seeking data regarding legal fees spent in the past 10 years from a number of entities not connected with the Future transaction. In this regard, it may be noted that the Future Group transaction with Amazon NV only took place in 2019. These questions raised along with other documents sought by ED point towards a fishing and roving inquiry," the plea read.

Accordingly, the plea prays for canceling the Directive dated February 19 2021 and all other proceedings commenced by ED in the matter.

It also prayed for directions on ED not to conduct a fishing and roving inquiry in matters covered by legal privilege and seek information falling outside the purview of FEMA.

Connected Cases Details:

1. FUTURE COUPONS PRIVATE LIMITED & ORS. V. AMAZON.COM NV INVESTMENT HOLDINGS LLC & ANR; ARB. A. (COMM.) 63/2021

2. FUTURE RETAIL LTD V. AMAZON.COM NV INVESTMENT HOLDINGS LLC & ORS; ARB. A. (COMM.) 64/2021

3. AMAZON.COM NV INVESTMENT HOLDINGS LLC V. FUTURE COUPONS PRIVATE LIMITED & ORS.; OMP (ENF.) (COMM.) 17/2021

4. AMAZON WHOLESALE INDIA PVT LTD & ANR. V. THE DIRECTORATE OF ENFORCEMENT & ORS.; W.P.(C) 14967/2021