The National Company Law Appellate Tribunal (NCLAT) on Wednesday asked the Competition Commission of India (CCI) to initiate a probe against e-commerce major Flipkart for alleged use of its dominant position for unfair practices.
NCLAT set aside the CCI’s 2018 order whereby the latter had said that Flipkart and Amazon are not dominant online marketplaces in the country.
The All India Online Vendors Association (AIOVA) had alleged abuse of market dominance against Flipkart India Pvt Ltd. The vendors’ body was of the view that Flipkart provided preferential treatment to certain sellers.
The anti-trust regulator in its November 6, 2018 order had said: “Flipkart India is not dominant in the relevant market of services provided by online marketplace platforms for selling goods in India therefore, the issue of abuse of dominant position does not arise.”
This is another blow for the company after the anti-trust body in January had ordered an enquiry into the operations of both Amazon and Flipkart on multiple counts, including deep discounts and exclusive tie-ups with preferred sellers.
However, on February 14, the Karnataka High Court ordered a stay on the CCI probe. The order came on the writ petition filed by Amazon seeking a stay on the investigation.
Further, days after the Karnataka High Court ordered a stay, the Walmart-backed Flipkart also moved the court urging it to set aside the probe. In its writ petition, Flipkart Internet Private Ltd said that although the High Court has ordered a stay on the investigation, the probe order of the Competition Commission of India (CCI) “deserves to be set aside”.