Companies

Examining ED summons on deal with Future group: Amazon

Our Bureau | | | Updated on: Nov 28, 2021
image caption

The ED investigating whether Amazon breached the FEMA in the ₹1,431 cr Future deal

The Enforcement Directorate (ED) has summoned Amazon India chief, Amit Agarwal, as part of an investigation into alleged irregularities in the deal with Future Group.

An Amazon spokesperson confirmed the same. “We are in receipt of summons issued by the ED in connection with the Future Group. As we have just received the summons, we are examining it and will respond within the given time frame.”

The ED is examining a deal that was struck between a Future Group company, Future Coupons Pvt. Ltd for over ₹1,431 crore back in 2019. The ED is examining if Amazon violated India’s Foreign Exchange Management Act (FEMA) or foreign exchange law.

The 2019 deal is central to the ongoing dispute between Amazon and Future group. If the 2019 deal itself is revoked, then Future could push through with its deal with Reliance Industries.

Also read: ED summons Amazon, Future Group executives in FEMA probe

Last year, Amazon dragged Future Retail and FCPL to the courts over a deal that Future Retail had struck with Reliance Industries in 2020 for ₹24,713 crore. Amazon claimed that Future Retail, a sister concern of FCPL, was in violation of an agreement signed in 2019.

Bone of contention

As per the agreement, according to Amazon, Future Retail could not strike a deal with Reliance or any other restricted parties.

Both companies have been mudslinging on each other since, and have tied each other in a host of cases.

Independent directors of Future Retail Ltd have also written twice to CCI in the past few weeks seeking revocation of the nod given to the US giant’s 2019 investments into Future Coupons, a promoter group entity of Future Retail.

On the other hand, Amazon too has alleged that Future Retail has laundered money and its audit committee has flagged financial irregularities.

Published on November 28, 2021

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