Shock to Amazon and Flipkart, Supreme Court refuses to interfere in government investigation
Walmart-owned Flipkart and Amazon had filed appeals before the Division Bench of the Karnataka High Court against the order to resume the CCI probe.
Flipkart and Amazon (Indicative Image)
The Supreme Court has refused to interfere with the Competition Commission of India’s (CCI) investigation against e-commerce giants Amazon and Flipkart for violating competition law. With this, the Supreme Court has given four weeks to the companies to join the investigation.
Earlier, Amazon and Flipkart had approached the Karnataka High Court against the CCI. But from there too they got a blow. The Competition Commission of India is probing allegations that the two companies promote select sellers on their e-commerce platforms and use huge discounts to stifle competition.
Walmart-owned Flipkart and Amazon had filed appeals before the Division Bench of the Karnataka High Court against the order to resume the CCI probe.
Why is the investigation being done?
The CCI had directed investigation of both the major e-commerce companies for alleged violation of provisions of competition laws. Flipkart and Amazon had filed separate appeals in this matter before the division bench. In its appeal, Flipkart Internet had sought setting aside of the June 11 court order, which was given by a single judge. It also requested to set aside the order of the Competition Commission of India (CCI) issued on 13 January 2020.
In its appeal, Flipkart said, “Given that the CCI order was stayed for 16 months, there would be no prejudice if this stay continues even further. If the investigation continues pending the present appeal, irreparable damage will be done as it will render the present appeal infructuous.”
Significantly, in January 2020, the CCI had ordered an inquiry against Flipkart and Amazon for adopting other alleged unethical business activities, including giving huge discounts and selling goods in preferential tie-up with certain companies. This order was challenged before a single-member bench of the Karnataka High Court.
A one-member bench dismissed the petition on June 11, 2021 and ordered the CCI to continue the investigation. After this order, the companies had reached the High Court to quash the inquiry order. Although the Karnataka High Court had given an interim stay in the CCI’s inquiry order on 14 February 2020, but after that the CCI reached the Supreme Court where the court asked it to return to the High Court on 26 October 2020.
