The Supreme Court on Monday refused to stay an antitrust probe against e-commerce giants Amazon India and Flipkart, observing that the firms must submit themselves to an inquiry by the Competition Commission of India (CCI).
“We expect big organizations like Amazon and Flipkart to voluntarily go for an inquiry. But you don’t even want that,” a bench headed by Chief Justice of India N.V. Ramana remarked while declining to entertain petitions by Amazon and Flipkart against an order of the Karnataka high court.
The bench, which also included justices Vineet Saran and Surya Kant, told the counsel for the companies: “You have to submit to an inquiry. You must go.”
On a request by Flipkart’s lawyer Abhishek Manu Singhvi, the court gave both companies four weeks to appear before the CCI director-general (DG).
This after senior lawyer Singhvi pointed out that the time to show up before the DG was expiring on Monday.
“We see no ground to interfere with the impugned judgement of the high court. However, we grant four weeks for the parties to submit to the inquiry,” the court recorded in its order.
Senior counsel Gopal Subramanium represented Amazon before the top court while solicitor general Tushar Mehta appeared for CCI.
In January last year, CCI ordered a probe into the two e-commerce companies’ practices, including discounting, exclusive tie-ups and private labels. The regulator took a prima facie view that these practices are anti-competitive and began investigating complaints that the companies circumvented Indian laws by creating complex business structures.
Amazon and Flipkart challenged the order in the Karnataka HC, arguing that CCI does not have “jurisdictional facts”. They added that there must be an anti-competitive agreement for any investigation of this nature, but no such agreement has been placed on record.
Flipkart contended that the manner of questioning by the CCI is “invasive” in nature, citing the CCI’s questionnaire that asked for a list of Flipkart’s top sellers, online discounts and pacts with smartphone makers.
However, a single judge of the Karnataka HC in June declined to entertain the objections made by the e-commerce platforms. The judge said in an order that it would be unwise to scuttle the regulator’s investigation.
CCI ordered a probe into practices, including discounting, exclusive tie-ups and private labels, at both firms last January.
