The Karnataka High Court on Friday stayed the investigation led by Competition Commission of India (CCI) against e-commerce giants Amazon and Flipkart for alleged anti-competitive practices, including predatory pricing and preferential treatment of sellers.
After the verdict, an advocate with the case said, “The commission’s order directing investigation is stayed by the court. It has given eight weeks for the parties to respond.”
On Monday, Amazon had filed a writ petition in the high court seeking a stay on the investigation ordered by the CCI.
In its plea, Amazon sought quashing and setting aside of the CCI’s January 13, 2020 probe order, and had also prayed the court to provide relief based on “facts and circumstances of the case in the interest of justice.”
After receiving several complaints, the fair-trade regulator CCI had ordered the probe against the two e-tailers for alleged malpractices.
In its petition, Amazon contended that the CCI order had been passed “without application of mind” and would cause irreparable loss/injury to the goodwill/reputation of the company if an investigation is allowed.
It also said the order would cause “serious prejudice” against Amazon and its findings are “perverse, arbitrary, untenable” in law.
Welcoming the stay, Amazon said, “while we welcome and respect the decision of the High Court of Karnataka, this is just a step in the legal process.”
On the other hand, the Confederation of All India Traders (CAIT), along with the Delhi Vyapar Mahasangh, have decided to would file an appeal against the High Court’s order. Both parties are in consultation with their respective lawyers.
Meanwhile, the CAIT said that it would push with the Union government to speed up the ED investigation and in this context, their members would soon meet Commerce Minister Piyush Goyal and Finance Minister Nirmala Sitharaman, it said in a statement.
CAIT said the high court has stayed the order for investigation passed by the CCI on the ground that the ED has already initiated an investigation into Flipkart and Amazon’s activities that are alleged to be in contravention of the FDI policy.
The court was therefore of the opinion that FDI violations being in the realm of the ED and the Adjudicating Authority under the FEMA, the case of CCI vs Bharti Airtel would apply to the case and ED would have to give its report before the CCI could proceed with the matter.
The court also noted that while the CCI had asked Amazon for its comments in a previous case (filed by AIOVA), CCI should have also called the parties in the present matter when they were made respondents before passing the impugned order, it added.
(With input from agencies)