Thread by @barandbench

#SupremeCourt to shortly hear a plea by Amazon against Delhi High Court order dated March 22 which stayed Single Judge’s order restraining Future Retail from going ahead with the 24,713 crore deal with Reliance Retail
@amazon @FutureGroup #relianceretail

Sr Adv Gopal Subramanium for @amazon will continue submissions today. He had earlier argued that the concept of "Emergency Arbitrator" and an award passed therein was not alien to the Arbitration and Conciliation Act, 1996.
#supremecourt

Sr Adv Gopal Subramanium for
@amazon: My investment in FCPL went straight down through the share purchase agreement.

Sr Adv Gopal Subramanium for
@amazon: this was argued before single judge and single judge paid heed to it. The argument was that Group of companies will apply when you have applications under section 45 of the act.

Subramanium: Top court judgment was cited where original agreement had clause of arbitration but substitute agreements had no reference to arbitration. Court had held that Substitute agreements didn’t come in the way of arbitration and this is the crux @amazon

Subramanium: the emergency arbitrator had held that the group of countries doctrine is applicable to this case and respondent number 2 is a fit party to the arbitration.
#amazon

Subramanium: retail assets of FRL cannot be alienated without the consent of the petitioner.

Subramanium: promoters have a serious question to answer on the part of the breach.
#amazon

Sr Adv Subramanium: Emergency arbitrator held investment to be lawful and control remained with FRL despite protective rights. So management & everything it was FRL and there was no interference at all. Award by the arbitrator was a valid one @amazon

Sr Adv Subramanium: These are provisions which aid the enforcement. there were multiple filingd before competition commission but these three filings were not to throw cotton wool. It was said order of approval was needed from CCI @amazon

Subramanium: CCI passed an order in November, 2019 and the FRL order became active in December and the other was active by September. This is not a matter of great complexity. these are the only two issues involved.

Sr Adv Subramanium: Whole hearted attempt made by filing 93 volumes of arbitration proceedings but i am not deterred by it.

Justice Nariman: pick up some of the judgments you have referred to us.

Subramanium: first is the South Delhi Municipal Corporation vs Tech Mahindra @amazon

Sr Adv Subramanium refers to a series of judicial decisions to support his submissions.
@amazon

Subramanium relies on paragraphs 11, 12 and 22 of M/S Deep Industries Ltd. vs Oil And Natural Gas Corporation.

@amazon

"Given the aforesaid statutory provision and given the fact that the 1996 Act repealed three previous enactments in order that there be speedy disposal of all matters covered by it, it is clear that the statutory policy of the Act is that not only are time limits set down.."

Subramanium goes onto rely on K.K. Modi vs K.N. Modi.

"If specific words such as 'arbitrator', 'arbitral tribunal', 'arbitrator' are used to describe the manner in which the dispute resolver is to act, they are likely to be persuasive although not always conclusive..

.. Where there is no express wording, the court will refer to certain guidelines."

@amazon
@FutureGroup
#relianceretail
#SupremeCourt

Senior Advocate Gopal Subramanium: In Sneh Lata Goel vs Pushplata, the Court held that an executing court cannot go behind the decree and must execute the decree as it stands.

@amazon
@FutureGroup
#relianceretail
#SupremeCourt

Subramanium relies Avitel Post Studioz Limited And ... vs Hsbc Pi Holding (Mauritius)

@amazon
@FutureGroup
#relianceretail
#SupremeCourt

Subramanium: In M/S Caravel Shipping Services vs M/S Premier Sea Foods Exim it was held, "An arbitration agreement needs to be in writing though it need not be signed. The fact that the arbitration agreement shall be in writing is continued in the 1996 Act in Section 7(3)...

..Section 7(4) only further adds that an arbitration agreement would be found in the circumstances mentioned in the three sub-clauses that make up Section 7(4). This does not mean that in all cases an arbitration agreement needs to be signed."
@amazon @FutureGroup

Court: Matter to be heard further at 2 PM.

@amazon @FutureGroup #supremecourtofindia

The Bench assembles.

Senior Advocate Aspi Chinoy, assisted by Senior Advocate Amit Sibal to being submissions.

@amazon @FutureGroup #supremecourtofindia

Chinoy: when you look at the cause title, Respondents 1-12 are the Biyanis, 13 & 14 are the Promoters.

1-12 really are the focus of the matter. It was the Biyanis who negotiated and induced Amazon to enter into these multiple agreements.

@amazon @FutureGroup #supremecourt

Chinoy: In the clash of corporates, one must not lose sight of the dramatis personae.

They wilfully breached their end.

@amazon @FutureGroup #supremecourt

Chinoy: The Biyanis are parties to the arbitration and are clearly bound by the arbitration agreement.

When the emergency arbitrator took up the matter, he noted, “Mr. Singh did not attempt to argue that no contract breaches were committed by the Biyanis.”

@amazon @FutureGroup

Chinoy: In the Enforcement Court, they have refused to draw on the merits. However, they advanced hair splitting arguments on legality.

@amazon @FutureGroup #SupremeCourt

There is rank dishonesty and commercial immorality in this case. You induce people to enter into agreements, then you breach these agreements. When it comes to the EA- you do not plead on merits.

@amazon @FutureGroup #SupremeCourt

Chinoy argues that after the order of the EA was passed, they completely flouted the directions and proceeded on the basis that the order is a nullity.

@amazon @FutureGroup #SupremeCourt

Chinoy: The matter comes up S.17 when an enforcement application is made. The Judge categorically hold them responsible and proceeds to enforce the EA's order.

The Biyanis file an appeal at this stage and the impugned order reiterates the reasons given for grant of Stay.

I believe there are very good legal reasons for everything, but the Biyanis have come without equity.

As lawyers, we can argue on the law, however the Judge must decide on Justice- what is right and wrong. What the Biyanis have done is completely wtrong.

@amazon @FutureGroup

Court addresses Sr. Advocate Chinoy: The second rule of equity is- equity follows the law. You have turned it on its head, Mr. Chinoy.

#SupremeCourt @amazon

Chinoy: Party autonomy are touchstones for #arbitration in India. Apart from this, there are no arguments on merits. Their only argument is the nullity.

#SupremeCourt @amazon

Sr. Advocate Chinoy discusses judgements impacting the the maintainability of the appeal.

#SupremeCourt @amazon

Chinoy: The words in Section 17 & 36 lay down the jurisdiction of the Civil Court as only an enforcement court/mechanism and not an appealable court.

@amazon @FutureGroup #supremecourt

#Chinoy concludes submissions saying, the record establishes that the conduct of the #Biyanis are clearly wilful and malafide. "I would humbly request that your Lordships resolve this epiphany of the Biyanis at a later stage. There is really no merit in their appeal at all."

Senior Advocate Ranjit Kumar submits Section 17 was expanded to include Section 9 into it, if Section 9 is enforceable then why is Section 17 not?

@amazon @FutureGroup #supremecourt

Senior Advocate #HarishSalve begins submissions for FRL.

@amazon @FutureGroup #supremecourt

Salve: I'm primarily submitting that whether the appeal is maintainable or not, no one has argued whether or not it is maintainable.

@amazon @FutureGroup #supremecourt

Salve: We were fortunate that Tribunal found dates and heard us for 5 days. We argued that we are not party to the agreement.

If Tribunal holds in my favour, the EA order will come to an end automatically.

@amazon @FutureGroup #supremecourt

Salve: The EA order is not an order under Section 17.

It may be an order and have had status of orders of tribunal prior to insertion of 17(2), I am arguing on party autonomy etc.

@amazon @FutureGroup #supremecourt

Salve: Section 37 only bars attempts to go behind an order under section 17.

@amazon @FutureGroup #supremecourt

Salve: Surely I can go in appeal and say this is an extreme Order. My appeal under O37 will be limited to that Order.

@amazon @FutureGroup #supremecourt

Salve: The Judge says I am exercising power under O39, but my Ld. Friends would have you believe this is an Arbitration Order.

@amazon @FutureGroup #supremecourt

Salve submits that the point an Order is passed, or there are any challenges to that award are comprehensively dealt with by the Arbitration Act, Section 37 has to be read in context.

@amazon @FutureGroup #supremecourt

Salve: The words from the orders passed by the Court under the Arbitration Act, if those words are not read with Section 37- it literally becomes absurd.

@amazon @FutureGroup #supremecourt

Salve: Any second appeal under the letters patent or the Commercial Courts Act is hit by sub-section 1 or 3.

The Scheme of the Act, therefore, is very clear.

@amazon @FutureGroup #supremecourt

Salve: In every case your Lordship has decided the question has been relating to one of these provisions and the appealability of the Order.

@amazon @FutureGroup #supremecourt

An award is enforced in the same manner as a decree and for all intents and purposes, it becomes a decree in accordance with the CPC, submits Salve.

@amazon @FutureGroup #supremecourt

Once an order is enforceable: you trigger the CPC.

The award cannot be challenged on the grounds of challenge of a decree.

@amazon @FutureGroup #supremecourt

Court poses a question to Sr. Advocate Harish Salve:

Suppose a Court passes an injuction order and it is flouted, can it not use the provisions of O39 for enforcing the same?

If it can, would appeals from that Order be maintainable?

@amazon @FutureGroup #supremecourt

Salve: My submission is that the scheme of the law of arbitration is you deliver an order in the same form as a decree.

@amazon @FutureGroup #supremecourt

Court: So, in short, the contrast in language is what you are stressing?

Salve: Yes, that is the long and short of my submissions on maintainability.

@amazon @FutureGroup #supremecourt

Salve: There is no judgement of this Court which suggests that I am wrong.

Paramjeet Singh Patheja vs Icds is the only judgement that the High Courts have picked up.

@amazon @FutureGroup #supremecourt

Bench of Justices RF Nariman and BR Gavai rises. Matter adjourned as part heard.

To be taken up on Tuesday, 27 July.

@amazon @FutureGroup #supremecourt

Matter over for the day
#SupremeCourt @amazon @FutureGroup #reliance