Opposing Amazon’s plea to restrain Future Retail (FRL) from further alienating its stores, the Kishore Biyani firm on Friday told the Supreme Court that the e-commerce company “wanted to destroy us, and it succeeded”.
FRL told a Bench led by Chief Justice NV Ramana that “for Rs 1,400 crore (the Amazon-Future deal), Amazon has destroyed a Rs 26,000-crore company. Amazon has been successful in what it wanted to do… We are hanging by a thread. No one wants to do business with us now. When the landlord gives an eviction notice, what can we do? ” senior counsel Harish Salve, appearing for FRL, said. He was referring to the takeover of 835 Future stores by Reliance Retail, a subsidiary of Reliance Industries, for Rs 3,000-crore unpaid rent.
He said FRL has lost control of over 800 stores on the lapse of lease due to the non-payment of rent and the eviction action was initiated by the landlords. “If Reliance does not extend our scheme, what will we do? We are on oxygen now. No payments can be made from our accounts as they have been frozen due to the NPA classification. ”
“Besides, we are running the remaining 374 stores on a wing and a prayer…” Salve added.
Alleging collusion between FRL and Reliance Industries’ subsidiary, Amazon claimed it was hard to believe that FRL surrendered its 800 stores without any protest. “Future’s claims that it was short of money and could not pay lease rental is a strategy and a sham… FRL lapsed leases being now in favor of Reliance is a deliberate and collusive act and it was unfathomable that over 830 stores could be let go of without any attempt to save them, ”senior counsel Aspi Chinoy, appearing for Amazon, said, adding that he had never seen a lessee that surrenders possession of property so swiftly without fighting it out in court.
Amazon stated that FRL had transferred its stores to Reliance after giving assurance to the SC on September 9, 2021, that its retail assets will continue to vest with it till the final order on sanctioning of the merger scheme comes from the National Company Law Tribunal.
Accusing the Future Group of committing “fraud”, senior counsel Gopal Subramanium, also appearing for Amazon, argued that the sudden handover of assets was a “sham” and a “smokescreen” and should not be done. Pending the arbitral proceedings, the assets have to remain with FRL, he said. “The annual accounts as on December 2021 showed they had enough money to pay their rentals. There is not a slightly compelling evidence that they (Future group) are not doing well, ”he said.
Meanwhile, FRL lenders requested the judges not to pass any order that will prejudice their rights. Senior counsel Rakesh Dwivedi, appearing for Bank of India, said no interim order should be passed to prevent banks from taking any action.
The court was hearing Amazon’s plea to restrain FRL from alienating its retail assets until arbitration between the US company and the Future group concluded. The case will next be heard on April 4 when the court is expected to conclude the hearing.