Amazon seeks to restrain Future Group from going ahead with deal with Reliance Retail: Live updates from Delhi High Court

The Delhi High Court is hearing Amazon's plea seeking the enforcement of the Emergency Award restraining Future Group from going ahead with its deal with Reliance Retail. The matter is before Justice JR Midha..Senior Advocate Gopal Subramanium appears for Amazon.The Emergency Arbitrator has passed interim order. All parties were heard, detailed order was passed. He found he has jurisdiction and that Future Retail was bound by Arbitration : Subramanium.Senior Advocate Darius Khambata for Future Retail: We have objections to the maintainability of the petiton. This is not a section 17 of Arbitration Act. It can't be enforced.It is based on SIAC Rules and fundings of the coordinate court: Khambata.Under section 17, only the final arbitration tribunal can pass the order. What Amazon is seeking to enforce is something else. Whatever order is passed at interim stage is not an order under section 17: Khambata.This emergency order will remain in force only till the final Arbitrator is appointed: Khambata.The SIAC Rules contemplate an Emergency Arbitrator who can decide its own jurisdiction. Counsel representing all parties were heard: Subramanium.These are the specific orders passed: Subramanium refers to the emergency award..Court reads the directions passed in the award..Subramanium reads the order out loud..This order was passed on October 25, 2020.. after hearing all parties including FRL: Subramanium .He asks court to see the SIAC Rule 10 under which emergency award was passed..The Emergency Arbitrator is appointed by SIAC Rules and he decides whether there should be any interim order: Subramanium.Subramanium reads the Rule..Within 90 days, a three member tribunal has been constituted and no step has been taken to vacate the Emergency Arbitrator Award. The Arbitration Tribunal was constituted on January 5th: Subramanium.Subramanium reads a letter written by Michael Hwang, the presiding Arbitrator, on January 12. .He addresses a mail to all the counsel.. the tribunal in the matter has been constituted. He asks if there are any preliminary matter that the counsel wished to raise: Subramanium.There is a letter from Mr Khambata's solicitor.. raising issues that FRL was not a party to the arbitration agreement: Subramanium.Mr Hwang notes this objection and .. that others did not wish to raise any preliminary issues : Subramanium.This question of jurisdiction was raised before the Emergency Arbitrator and it was rejected on account of Group of Companies approach. It was raised before SIAC Court and it was rejected: Subramanium.No action has been taken by any Respondents to reverse or modify the emergency award: Subramanium.Subramanium notes that the parties undertook to abide by the order passed by the Emergency Arbitrator..They have chosen not to file any appeal: Subramanium.Series of letters are written by FRL to authorities saying that the award should be ignored, it is a nullity.. there is an express provision that interim awards are orders of the court under section 17(2): Subramanium.Subramanium reads section 17(2)..All these contensions were rejected.. they wrote to statutory authorities..there is no law under which a party can unilaterally declare an award to be a nullity: Subramanium.Subramanium presses for an injunction restraining FRL and others from taking steps in furtherance of the deal with Reliance and disposing of FRL's retail assets..After this order was passed, they write to every statutory authorities.. but they say this order doens't bind. The CCI, SEBI.. contrary to the Award, pursue the authorities. The award is completely disregarded : Subramanium.Subramanium informs that CCI and SEBI have given their approval. .On November 7, they institute a suit against me that I'm interfering with their contractual obligations: Subramanium.Before the Single judge, they say Emergency Arbitrator is quorum non judice.. it was held that the Arbitrator was not quorum non judice.. they again write to the authorities saying the award is vitiated: Subramanium.Until the award is alive, it is efficacious. No party can sit in judgement and declare an order to be a nullity: Subramanium.In that suit, some observations were passed in relation to my client. We have filed an appeal: Subramanium.The single judge dismissed their application to restrain me from writing to the authorities: Subramanium.The regulator has given the approval.. is the Award so ineffective that somebody can completely disregard the Award? Even the single judge says deal with it in accordance with law: Subramanium.Our appeal has nothing to do with the enforceability. They have moved no application before the newly constituted Arbitration Tribunal: Subramanium.The Emergency Arbitrator found that it was clear that promoters controlled all the companies.. the promoters have not moved any application against the Emergency Award: Subramanium.Subramanium refers to an order passed by Justice Nariman, Supreme Court..We must give teeth to the enforcement of interim orders of arbitration award: Subramanium.Subramanium refers to a Kerala High Court judgement..It is not maintenance of a kind of status quo: Subramanium as he explains the directions in the award..The next day of the award, they say they are not bound by the award. They pursue it before the statutory authorities contrary to the award: Subramanium.Senior Advocate Rajiv Nayar points out the portion of single judge order stating that the award is enforceable..Khambata prays for time to file an objection to the petition. .Very sorry. We will deal with it today. No adjournment: Court.Is there any judgement on your proposition? : Court .No. Section 17 says the award has to be during the arbitral tribunal. Emergency Arbitrator is not an arbitral tribunal: Khambata.Emergency Arbitrator is before an arbitration tribunal is constituted. The rules make a distinction between Emergency Arbitrator, court and Arbitrator : Khambata.There must have been many emergency arbitrations before SIAC. There must be cases to show whether it is enforceable or not : Court.Those were all Part II Arbitrations, Delhi HC has held that separate suit had to be filed for enforcement. This is a Part I Arbitration: Khambata.We argued there that emergency Arbitrator is quorum non judice. The single judge says it's not because parties can agree to a procedure. However, the findings did not turn on section 17: Khambata.Court says it is an alternative to Section 9. Territory is for this court to decide: Khambata.We filed this two months later. That's why I said we should be allowed to file a response: Khambata.Single judge said let the regulator decide. She has squarely held that the transaction propounded by Amazon is illegal and my transaction with Reliance is valid and we could act on the consent given for it: Khambata.I have 1000s of employees. I am a public Ltd companies. He knows that it the transaction doesn't go through, I will collapse : Khambata.Every prima facie finding was in my favour. He has gone in appeal, I haven't: Khambata .Do you propose to take any action in violation of the Emergency Award in the near future? : Court.The matter is already in regulatory sphere: Khambata .Some action you've already taken. Do you want to take any further action?: Khambata.I'm being told that there is a petition before NCLT for demerger: Khambata .Would you hold you hand back?: Court .I want to proceed. The NCLT Petition will not get over in one week. Normal routine orders will be passed: Khambata.We will continue the hearing at 3 pm. Give 5 page note with summary.. attach whatever judgements you want to refer to: Court.List of dates can be given separately. Give a note on action you have already taken and what you propose to take: Court.Give the note in half an hour: Court.In the interest of efficiency, may we request that it would be taken up tomorrow: Khambata .Can you give a statement that you would hold your hand till then?: Court .No..: Khambata .Then don't embarass yourself: Court.I don't think one day will make a difference: Khambata .Client is burdened with huge liability (on paying additional day's fee to senior counsel) : Court .Half an hour will not be possible: Khambata.Okay, 45 minutes. Send it in parts : Court.Court asks for caselaws as well..I will show orders of Delhi High Court and Surpreme Court: Subramanium.Hearing adjourned till 3 pm..Proceed according to the note submitted by you : Court.I will keep it very brief : Subramanium.Hearing resumes..Our note is under process: Khambata.Most unfortunate: Subramanium.During the course of the morning arguments, the NCLT petiton was filed : Senior Advocate Nayar.The Emergency Arbitrator gave notice to all parties, heard everyone patiently .. this argument was made before him: Subramanium.First thing is that the question whether the Emergency Arbitrator could have passed the order was raised for the first time before the Emergency Arbitrator itself. The arguments are being made over and over and rejected: Subramanium.I'll just give an overview..This (the objections) is all repetition..: Subramanium.Which is this point on the note?: Court.This is to show that everything was considered and rejected: Subramanium.Subramanium reads the order of the Emergency Arbitrator..This is clear from the Award that these objections were raised .. : Subramanium.Subramanium continues to read the Emergency Award..I issued notice of Arbitration on 15/10/2020 and the interim order/award is during the pendency of the Arbitration: Subramanium.Subramanium reads that Emergency Award noted that the Indian law accepted parties opting for emergency arbitration..Subramanium states that the Delhi, Mumbai, Chennai Arbitration Centres have provisions for Emergency Arbitration and the same is recorded in the award..We initiated Arbitration on the basis of breaches. The Emergency Award is not ex parte : Subramanium.Even in Singapore, interim orders can be enforced by leave of court. Here, Parliament days straight away you can enforce them as order by court: Subramanium.Petiton is under section 17(2). It is a unique amendment: Subramanium.Please proceed according to your note : Court.These are fruits of wilful disobedience: Subramanium.Subramanium continues to list the breaches..The Arbitrator injuncted steps in furtherance of the Board resolution and taking up the matter with the regulatory authorities..they did precisely this: Subramanium.In spite of the directions, FRL breached the order multiple times : Subramanium as he lists the date..There is some unique power and authority.. to now come out and say it is a nullity after participating in it: Subramanium.Subramanium states that there is a disclosure on 26/10 by FRL saying that we will not abide by it. .Subramanium continues to refer to the "list of breaches" supplied by it..FRL is bound by the Award. It may be a contested jurisdiction but there is an order against it: Subramanium .Khambata clarifies that the NCLT filing was done on January 26 and not today..Subramanium refers to FRL writing to CCI against the Emergency Award..FRL objection that it was not a party to the Arbitration Agreement was argued and rejected: Subramanium.He is also telling me that I should not show the order to others: Subramanium.Subramanium refers to FRL writings to Regulators that it would not comply with the Award as it was a nullity..Section 17 applies and section 17(2) gives it the color of the order of the court : Subramanium.Subramanium: Each Respondent is in continuous breach. It cannot rely on fruits of a poisonous tree.You need not go into details .. they have taken a stand and proceeding with it : Court.Any advanced Jurisdiction has provisions for Emergency Award now : Subramanium.Status of Emergency Arbitrator was questioned at two stages: Subramanium has he reiterates that the challenge was rejected each time..Subramanium refers to the order passed by Justice Mukta Gupta. .There is no application before the Arbitration Tribunal. Only a collateral objection was taken before the Single Judge in the suit : Subramanium.Emergency Arbitrator is not alien to Arbitration Act. The SIAC Rules are treated to be part of the act in the present case: Subramanium.The SIAC Rules define an Arbitrator as including an Emergency Arbitrator and these are the Rules that he/Future Group agreed to : Subramanium.FRL cannot be allowed to re-agitate the objections: Subramanium.Ld Judge rejected the argument that Emergency Arbitrator was quorum non judice. Hence it ought to be enforced: Subramanium.Subramanium refers to Justice Nariman's judgment which reaffirmed an order by Delhi High Court..The Emergency Arbitrator Order preserves the subject matter of the disputes during the Arbitration proceedings. Section 17 is attracted : Subramanium.Emergency Arbitrator functions as an arbitrator. All over, in all texts, an Arbitrator and Emergency Arbitrator perform the same functions : Subramanium.Subramanium states that the Emergency Award is deemed to be passed in Delhi..In the jurisdiction of enforcement, there is duty to give effect to orders and decrees. This involves adherence to law and rule or law. Why should we not enforce orders of Arbitrators? : Subramanium.If you want to file an appeal, you can: Subramanium as he continues to refer to the judgement..Subramanium refers to Kerala High Court judgement..Parties can not only go to an Emergency Arbitrator .. the parties may also agreed to treat it an final and binding. Or he may file an appeal for vacation of the order: Subramanium.Subramanium refers to Rule 10 and Rule 12 of SIAC Rules.There are three questions. Is there an order? Is it clear? Is it by a competent authority?: Subramanium.Subramanium concludes..He must not get benefit of an approval which he extracted in violation of the Award : Subramanium..For a party to continuously resist, the Arbitration Act will become completely meaningless. All centres have said that Emergency Award can be enforced: Subramanium.Section 17 only recognises the interim order passed by the arbitral tribunal and no other authority: Khambata.None of Justice Gupta's findings hold that the Emergency Award is enforceable under Section 17: Khambata.Senior Advocate Darius Khambata begins. .Once Tribunal is appointed, it is a permanent body: Khambata.Khambata reads the definition of Arbitrator under the Act..This is a very far reaching provision. Even in Singapore, there is no direct enforcement. Section 17 cannot be overextended to orders that don't fall under it: Khambata.Under section 9, if interim relief is required, a party may move court : Khambata.In our Act, there is the Arbitral Tribunal. It does not admit any temporary authority: Khambata.Khambata states the provisions under which an Arbitral Tribunal can be terminated..Even assuming that the Emergency Arbitrator was not quorum non judice, it is not an authority of an Arbitration Tribunal. There is nothing in Part 1 to say that it an order under Section 17: Khambata.The single judge equates the Emergency Arbitrator to this court under section 9 and not the Arbitrator under Section 17 : Khambata.This is the only time when there can be a relief pre or post Arbitration : Khambata.The note is under process. We will give it: Khambata.Khambata refers to SIAC Rules..Khambata shares the Rules on the screen. We can go to Rule 1.3 on definition of award. The Emergency Arbitrator Award is treated seperately and Emergency Arbitrator is defined seperately: Khambata.You have sent us different Rules : Court.Khambata reads rule on Interim and emergency interim relief..There is definition of Tribunal .. SIAC rules also don't treat Emergency Arbitrator as Arbitrator: Khambata.It is crystal clear that the two entities are different: Khambata.Emergency Arbitrator cannot act as Arbitrator even in future: Khambata.Emergency Arbitrator is prior to the constitution of the Arbitral Tribunal: Khambata.You have three distinct authorities. The Tribunal, the Emergency Arbitrator who not is the Tribunal and the judicial authority. The SIAC rules create Emergency Arbitrator as a separate entity : Khambata.Delhi, Mumbai and Chennai have rules for Emergency Arbitrator but they start with the rule that they are subject to the mandatory provisions of mandatory law: Khambata.Under section 17, it is only the Tribunal that can pass an order for direct enforcement. Nobody is saying don't give enforceability: Khambata.Tribunal is not bound and if Tribunal is not constituted, the emergency award is dissolved : Khambata.Emergency Arbitrator is outside the Tribunal: Khambata.Senior Advocate Harish Salve says that the clients would want him to see the note before it is filed..We can give it before the evening: Khambata .How long would your note take? : Court.Give a brief note. List of dates can be given seperately. We'll continue tomorrow: Court.They would have to show that the world would be upside down if the interim order is not passed: Salve for Future..We are hearing it.. : Court .Let it be said that the nothing will happen : Nayar.We'll see. This is interim.. : Court.A reply is called to the averments in the petition: Salve.Try to send the note by 5:30 : Court.You will hear more of it : Salve.Subramanium objects..This poor little American company will come to road (if interim order is not passed).. : Salve

Amazon seeks to restrain Future Group from going ahead with deal with Reliance Retail: Live updates from Delhi High Court

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