The ongoing dispute between US e-commerce giant Amazon and Indian conglomerate Future Group just got a whole new dimension. On Thursday, the Delhi High Court upheld Singapore Arbitrator’s Emergency Award (EA) order against the ₹24,713 crore deal between Future Retail Limited (FRL) and Reliance Retail.

Earlier, the court had ordered the maintenance of the status quo in relation to the Future Retail-Reliance deal. Amazon had also sought enforcement of the award passed by the Singapore Emergency Arbitrator on October 25, 2020, which restrained Future Retail from going ahead with the deal with Reliance Retail.

Thursday’s news comes as a huge win for Amazon, which has been contesting the deal ever since it was made public, stating that it had “protective rights” in Future Retail Limited and not “controlling rights” in FRL, and the same were being breached by the sale of FRL assets to a restricted entity, Reliance. The e-commerce giant maintained that had it not been for the assurance given by Future Group promoters and Future Coupons Private Limited that the retail assets of Future Retail would be protected, there would have been no investment in Future Coupons by Jeff Bezos’ company.

A single-judge bench comprising of Justice JR Midha held that the emergency arbitrator is an arbitrator for all the intents and purposes under sec. 17(1) of Arbitration and Conciliation Act and an order passed by such an emergency arbitrator is enforceable under sec. 17 (2) of the Act. It also held that Future Retail, Future Coupons, Kishore Biyani, and others had violated the Emergency Award, saying that the petitioner (Amazon) did not violate any law.

Misfortunes never come alone, it seems. Not only is this a major setback for the cash-strapped Future Group, which was banking on the deal with Reliance to avoid liquidation, but the Kishore Biyani-led Group has been fined ₹20 lakh to be deposited in the Prime Minister’s Relief Fund for Covid-19 to be used for vaccinating senior citizens belonging to the below poverty line (BPL) group. The Court ordered that it is to be deposited within 2 weeks and the same shall be put on record within 1 week thereafter.

The court held that the Emergency Arbitrator had rightly invoked the ‘Group of Company’ doctrine in relation to the Future Group companies. Future Group has been directed to approach the authorities for recall of the approvals granted for the Future Retail-Reliance deal and not take any further action regarding furthering the deal.

Additionally, the court issued a show-cause notice to Biyani and others and asked them to appear before it on April 2, further asking them to explain why they should not be detained for three months in civil prison for violating the arbitrator’s order. The court also ordered the filing of an affidavit detailing Biyani’s assets.

Future Retail had earlier argued that the Emergency Award was a nullity, relying on the prima facie view given by the single judge and contending that the Emergency Award was not enforceable under Section 17(2) of the Arbitration Act.