Sale of Future Retail a breach of contract, Amazon tells Supreme Court

Amazon has accused Future Group founder Kishore Biyani and his extended family of breaching a 2019 contract agreement under which the American ecommerce firm invested in a promoter company of Future Retail. “The promoters, that is the Biyanis, have a serious case to answer on breach,” Aspi Chinoy, the senior counsel representing Amazon, told the Supreme Court on Thursday.

Chinoy was arguing in a case filed by Amazon in April, challenging a March order by a Delhi High Court division bench quashing the order of a single-judge bench. The single-judge bench had ordered attachment Biyani’s properties for allegedly violating an October 2020 emergency award by a Singapore arbitrator, restraining Future Retail from proceeding with its Rs 25,000-crore sale of assets to Reliance Retail until it decided on Amazon’s petition.

Amazon has accused the Biyanis of willfully ignoring the October emergency order of the Singapore International Arbitration Centre (SIAC).

Amazon lawyers had argued previously in the Delhi High Court that Future Retail continued seeking approvals from the statutory authorities including the Securities and Exchange Board of India and the Competition Commission of India for the deal despite the injunction order from the SIAC.

“They are parties to the arbitration agreement. They have agreed to the clauses which include the emergency arbitrator. An order has been made asking them not to proceed with applications (to the regulatory authorities). They proceed on the basis that this order is a nullity,” Chinoy said.

On Thursday, lawyers from both Amazon and Future Retail also argued whether Future Retail can be a party to the arbitration. Future lawyers maintain that the arbitration agreement was between promoter company Future Coupons and the US ecommerce giant that invested about Rs 1,500 crore to acquire a 49% stake in it in 2019, and that the listed Future Retail had nothing to do with it.

Future Retail has no arbitration agreement with Amazon and Amazon is wrongly insisting that Future Retail’s entering into a deal with was a breach of the shareholder agreement (SHA), senior lawyer Harish Salve told the court. “The seamless argument doesn’t quite spell out which agreement am I in breach of.”

Salve said Future Retail had earlier filed a case in the Delhi High Court seeking an injunction against Amazon from “tortious interference by wrongfully representing that I had breached my SHA”.