Chennai: Amazon’s appeal challenging the Competition Commission of India’s decision to suspend the approval given for its deal with Future Coupons has been rejected by NCLAT.
“Amazon failed to notify Future Retail Share Holding Agreement and the commercial arrangements, as parts of the combination between the parties, and suppressed the actual purpose and particulars of the combination (of deals), as discussed above, in contravention of the obligation…” NCLAT observed.
In December 2021, CCI had kept in abeyance the approval given by it in 2019 for Amazon's deal to acquire a 49 per cent stake in Future Coupons. It had found that Amazon had suppressed information while seeking clearances for the transaction. It had slapped a fine of Rs 202 crore on the company - Rs 200 crore penalty for the failure to notify combination of deals and Rs one crore each for suppressing the actual scope and purpose of the combination.
NCLAT upheld the Rs 200 crore penalty. “Amazon is directed to pay a monetary penalty as imposed vide paras 82 and 83 above, within a period of 60 days from the receipt of this order,” it said.
However, it reduced the penalty for suppression of the actual scope and purpose of the combination from Rs one crore each to Rs 50 lakh each as it found that the penalty was ``on the higher side”. This has to be paid within 45 days.
Amazon had opposed Future Retail’s deal to sell assets to Reliance Retail as part of a proposed Rs 24,713-crore deal on the basis of its 2019 transaction. In August 2019, Amazon had agreed to purchase 49 per cent in unlisted Future Coupons, which owns 7.3 per cent equity in listed Future Retail through convertible warrants.
Future Retail is presently facing an insolvency petition filed by its lenders before the Mumbai bench of the National Company Law Tribunal....