sebi:Order/AK/JR/2025-26/31385

SEBI · SEBI · 2021-02-18 · Amit Kapoor, Adjudicating Officer

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Facts / Headnote

Violations established; penalty of Rs. 10,00,000 imposed under section 15A(b) of the SEBI Act

Provisions invoked

Regulations

Parties

Holding

The Noticee (Future Retail Limited) was found to have violated Regulations 4(1)(d), 4(1)(e), 30(3), 30(4)(i)(a), (b), 30(6), 30(7), 30(11) of the LODR Regulations read with SEBI Circular dated September 9, 2015, and Clause 4 of Schedule A of the PIT Regulations, by failing to timely and adequately disclose the initiation of arbitration proceedings by Amazon before SIAC and the subsequent interim order of the Emergency Arbitrator. A penalty of Rs. 10,00,000 was imposed under section 15A(b) of the SEBI Act.

Full text

Adjudication Order in the matter of Future Retail Limited Page 2 of 27 appointed Shri K. Saravanan as Adjudicating Officer (hereinafter referred to as “AO”), vide order dated February 18, 2021, to inquire into and adjudge the alleged violations by the Noticee. On transfer of the matter, the undersigned was appointed as the AO in the matter, vide order dated November 22, 2024.

Adjudication Order in the matter of Future Retail Limited Page 3 of 27 4.4 Amazon raised concerns with regard to the said scheme between Future group and MDA Group, and accordingly initiated arbitration proceedings on October 05, 2020 before Singapore International Arbitration Centre (hereinafter referred to as “SIAC”) against Noticee, FCL and the Promoters (led by the Biyanis) and sought emergency interim relief with respect to the scheme. 4.5 The Emergency Arbitrator (hereinafter referred to as "EA") appointed by the SIAC under the SIAC Rules, has passed an Interim Award dated October 25, 2020, wherein EA has specifically noted that FRL did not have the consent from FCL and consequently from Amazon, and accordingly, the board of directors of the Company could not have approved the impugned transaction.

Adjudication Order in the matter of Future Retail Limited Page 4 of 27 sub-regulation (4) of Regulation (30) of LODR Regulations.” Furthermore, regulation 30(11) of LODR Regulations stipulates that “the listed entity may on its own initiative also, confirm or deny any reported event or information to stock exchange(s).” Furthermore, regulation 30(6) of LODR Regulations stipulates that “the listed entity shall disclose the events or information as soon as reasonably possible and not later than twenty-four hours from the occurrence of event or information.” 4.6.4 Due to non-disclosure of said proceeding, the stock exchange sought clarifications from Noticee in this regard. Noticee submitted that the commencement of said proceedings was not considered a material event and thus not disclosed. 4.6.5 It was observed that Mr. Kishore Biyani and others (Promoter and Promoter Group) are holding approx. 29% shares in the Noticee (as per September 2020 quarter) and 51% in FCL. Hence, both companies are part of the same business group. Further, both the companies are related party as per the definition of Section 2(76) of the Companies Act, 2013. 4.6.6 It was observed that the SHA among Promoter & Promoter Group, FCL and Amazon on August 22, 2020 was disclosed by Noticee as material event under regulation 30 of LODR Regulations because the common Promoter & Promoter Group are involved in the SHA and the companies are related. Accordingly, it is observed that while Noticee was not a party

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Source: SecMarx — sebi:Order/AK/JR/2025-26/31385. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.