Flipkart, Amazon Must Face an Inquiry by CCI for Anti-Competitive Practices: SC

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The Supreme Court on Monday declined to entertain a plea by eCommerce giants Amazon and Flipkart, saying they must face an inquiry by the Competition Commission of India (CCI) for anti-competitive practices.

A bench headed by Chief Justice N.V. Ramana and comprising justices Vineet Saran and Surya Kant said: “Big organisations like you (Flipkart and Amazon) should volunteer for inquiry… Inquiry has to be conducted.”

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The bench declined to interfere with the orders of the Karnataka High Court, which refused to interfere with the preliminary inquiry ordered by the CCI into their alleged anti-competitive practices.

“Carefully perusing the material available on record, we see no reason to interfere with the impugned orders passed by the High Court of Karnataka dismissing the Writ Appeals of the petitioners. The Special Leave Petitions are, accordingly, dismissed,” said the top court in its order.

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Senior advocate A.M. Singhvi, appearing for a petitioner, submitted that time to reply to the notice issued by the Office of the Director General; CCI is going to expire on August 9, and sought an extension of time.

The top court, in its order, said: “Taking into consideration the request made by the learned senior counsel, time to reply to the notice is extended by a further period of four weeks from today. It is made clear that no further extension of time would be granted for the purpose. Consequent upon dismissal of the Special Leave Petitions, all the pending applications filed in the matters also stand disposed of.”

The e-commerce companies had moved the apex court, challenging the Karnataka High Court order. On July 23, the Karnataka High Court dismissed the plea by Amazon and Flipkart against a probe initiated by the CCI for the alleged violation of competition law.

A division bench of Justices Satish Chandra Sharma and Natraj Rangaswamy passed the order on a batch of appeals moved by the e-commerce companies, challenging a June 11 order passed by a single high court judge.

The bench noted that by no stretch of the imagination can the inquiry can be quashed at this stage, and the appellants shouldn’t be afraid of an investigation by the CCI. The bench said: “In the considered opinion of the court, appeals filed by appellants are devoid of merit and deserved to be dismissed…”

Amazon had moved Karnataka High Court against a CCI order which had called for a Director General level investigation into allegations of anti-competitive conduct in the online sale of smartphones on its platform. The informant before the CCI, the Delhi Vyapar Mahasangh (DVM) had alleged predatory pricing, deep discounting, preferential seller listing, and exclusive partnerships, among others, against Amazon and Flipkart.

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