Supreme Court Quashes ₹202 Crore Penalty on Amazon in Future Coupons Case

Supreme Court Sets Aside ₹202 Crore Penalty on Amazon

In a significant development, the Supreme Court has overturned the Competition Commission of India's (CCI) order imposing a ₹202 crore penalty on e-commerce giant Amazon for allegedly failing to disclose details of its acquisition of a 49% stake in Future Coupons Pvt. Ltd (FCPL).

The two-judge bench comprising Justice Vikram Nath and Justice Sandeep Mehta delivered the judgment, directing that any amount deposited by Amazon be refunded within eight weeks, along with 6% annual interest on the amount deposited. If the refund is not made within the stipulated period, the amount remaining unpaid shall carry simple interest at the rate of 9% per annum from the expiry of eight weeks until the date of payment.

The dispute dates back to 2019, when Amazon invested ₹1,431 crore to acquire a 49% stake in FCPL, which in turn held a 9.82% stake in Future Retail. The Competition Commission of India suspended its earlier approval for the transaction in December 2021, stating that Amazon had failed to disclose that the FCPL deal, the Future Retail shareholders' agreement (FRL SHA), and related commercial agreements formed part of a "single integrated transaction".

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The regulator also alleged that Amazon made one set of representations before the CCI and another before a Singapore arbitration tribunal and courts. Before the CCI, Amazon described the transaction largely as an investment in FCPL and its payments and loyalty business. Elsewhere, however, the company argued that its "strategic interest" lay in Future Retail's retail assets and business network.

Amazon challenged the order before the National Company Law Tribunal (NCLT), which in June 2022 upheld the regulator's decision. The company had separately opposed Reliance Retail's proposed ₹24,713 crore acquisition of Future Retail's assets, a deal that was later called off. The company had argued that its 2019 transaction with FCPL gave it rights that were affected by the proposed sale.

In 2023, the apex court had granted interim relief to Amazon by staying the ₹202 crore penalty. Emails seeking comment from Amazon and the CCI remained unanswered till press time.

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