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30 Mar 2020, Edition - 1721, Monday

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Business

Flipkart challenges CCI probe, says ‘order passed without application of mind’

https://www.businesstoday.in/

After Amazon, Walmart’s Flipkart has filed a legal challenge against the anti-trust probe ordered by Competition Commission of India (CCI). Flipkart argued in its plea that the CCI ordered the initial probe without any evidence that the company’s practices were harming competitors. Flipkart said the CCI order was “perverse (and) passed without any application of mind”.

“Such an order exposes responsible corporate entities … to the rigors of an intrusive investigation prejudicially affecting not only its credibility and reputation, but also its commercial prospects,” said Flipkart, urging the court to quash the probe, as mentioned in a report in news agency Reuters.

Flipkart also said that the CCI ‘failed in its duty’ to close the ‘frivolous’ complaint and said that the probe would harm the company’s reputation as well as lead to loss of time and legal costs.

A spokesman for Flipkart did not comment on the contents of the filing, and told the news agency that it was a “procedural matter”. The CCI, too, did not respond to the news agency’s request for comment.

The case is likely to be heard next week.

The filing comes days ahead of US President Donald Trump’s visit to India, and amid concerns of India’s tightening of foreign investment rules in the e-commerce sector.

Also read: Amazon Inc challenges CCI investigation; says will cause ‘irreparable loss’ to company

The CCI had ordered a probe into alleged violation of competition law and certain discounting practices by Flipkart and Amazon. A state court had put the investigation on hold last week following a challenge by Amazon.

Indian retailers had accused Amazon and Flipkart of violating local laws and racking up billions of dollars of losses to fund deep discounts. They were also accused of discriminating against small sellers. The companies have denied the allegations.

The antitrust probe was ordered after a New Delhi-based trader group complained that the e-commerce giants were promoting select sellers and in turn hurting business for other smaller players.

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