Amazon is likely to move the Supreme Court sometime next week against the National Company Law Appellate Tribunal’s order that recently upheld the Competition Commission of India’s December 2021 order related to non-disclosures by the e-commerce major.
The NCLAT order dealt a blow to Amazon as apart from upholding the penalty of Rs 200 crore levied on it by the CCI, it also upheld its suspension of the 2019 deal to acquire 49% stake in Future Coupons (FCPL). The approval for the deal was accorded by CCI in 2019 but after complaints by some parties that certain information were not disclosed, CCI put the deal in abeyance. The complaints had come post Future Retail’s decision to sell its retail and logistics businesses to Reliance Retail. This transaction was objected by Amazon as it claimed first right of refusal to any sale by FRL in its capacity as a 49% stakeholder in FCPL.
“Amazon has failed to make fair, frank and forthright disclosures pertaining to the 2019 deal with Future Group. The tribunal is in agreement with the CCI view and thereby directs Amazon to deposit Rs 200 crore as penalty,” the tribunal had held, while completely agreeing with the CCI that Amazon furnished limited disclosures about its acquisition of strategic rights and interests in Future Retail.
The deal has failed now because FRL’s lenders did not approve it as Reliance Retail had already taken over around 900 stores because Future had defaulted on rent payment.
Still, there are cases in the Delhi High Court between FRL and Amazon relating to the matter.
The Delhi High Court single judge bench of Justice C Hari Shankar is already hearing half-a-dozen cases, including Amazon’s plea seeking enforcement of a Singapore tribunal’s order staying the sale of Future Group’s retail assets to Reliance Retail and another to stop Future Retail from further alienating its assets.
Meanwhile, Amazon has also filed its intervention before the National Company Law Tribunal, Mumbai Bench, opposing the Bank of India’s insolvency petition against debt-laden Future Retail on the grounds that the banks had colluded with FRL and that bankruptcy proceedings at this stage would compromise its rights.
BoI had in April approached the NCLT to recover the debt of Rs 1,441 crore from FRL. The total exposure of banks to FRL is estimated to be at about Rs 17,000 crore, a figure which could climb to as high as Rs 25,000 crore if debt defaults continue, some creditors had argued earlier.