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Monday, March 30, 2020

Flipkart moves Karnataka HC against CCI investigation

Flipkart argued that by passing the impugned order, CCI has contradicted its own orders and precedents wherein it had dismissed similar allegations raised against the petitioner (Flipkart).

By: ENS Economic Bureau | New Delhi | Published: February 22, 2020 6:13:56 am
Flipkart moves Karnataka HC against CCI investigation Though the high court on February 14 had issued an interim stay order against the probe based on rival Amazon’s plea, procedure demanded that Flipkart also file a petition as it is a respondent and party in the matter.

Flipkart has filed a writ petition in the Karnataka High Court seeking a stay on the “operation, effect and implementation” of the Competition Commission of India’s (CCI) order asking its director general to investigate Flipkart’s alleged business practice of deep-discounting, preferential listing of sellers and exclusive pacts.

Though the high court on February 14 had issued an interim stay order against the probe based on rival Amazon’s plea, procedure demanded that Flipkart also file a petition as it is a respondent and party in the matter. Flipkart, in its February 18 petition, said there is more than a strong prima facie case that the impugned order is “ex facie illegal” and is liable to be set aside in as much as it “fails to meet the basic/essential jurisdictional prerequisites under section 26(1) of the Competition Act”. Section 26(1) of the Act establishes that there is a prima facie case for probing a matter.

Flipkart argued that by passing the impugned order, CCI has contradicted its own orders and precedents wherein it had dismissed similar allegations raised against the petitioner (Flipkart).

Further, the company said the CCI had initiated a market study on e-commerce in India wherein it has repeatedly advocated a non-interventionist and self-regulation approach towards e-commerce players in the country. “It is respectfully submitted that the CCI cannot alter its stand from time to time,” the firm said in the petition. “… We are a party to the CCI order and a respondent in Amazon’s writ against the order. Given this position and the High Court stay, as a procedural matter, we are also filing a writ,” a Flipkart spokesperson said.

On February 10, Amazon had filed a similar petition in the high court stating that the findings established by the impugned order are “perverse, arbitrary, untenable in law”. On February 14, the High Court had stayed the CCI probe observing that the Enforcement Directorate (ED) has already initiated probe into Amazon and Flipkart’s operational activities alleged to be in contravention of the FDI policy in e-commerce.

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