SC refuses to stop CCI's antitrust probe against Amazon, Flipkart

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New Delhi: In a setback to Amazon and Flipkart, the Supreme Court on Monday refused to stop the preliminary antitrust probe by the Competition Commission of India(CCI) against the e-commerce giants, saying it expects such big organisations to offer themselves for the inquiry.

A three-judge bench headed by Chief Justice N V Ramana declined to entertain the separate appeals of Amazon and Flipkart against the order of the Karnataka High Court which had refused to stop the CCI from carrying out a preliminary probe into the alleged violation of the competition law by the two e-commerce companies.

Challenging the enquiry is like wanting a notice before the registration of an FIR under the criminal law, the bench, which also comprised justices Vineet Saran and Surya Kant, observed, and asked the e-commerce giants to submit themselves to the probe by the CCI.

"We expect big organisations like Amazon and Flipkart to offer themselves for the inquiry and you do not want that. You have to submit and enquiry has to be permitted," the top court said.

The CCI's January 2020 probe order followed a complaint by Delhi Vyapar Mahasangh, whose members include many traders dealing in smart phones and related accessories, alleging that the e-commerce firms have been violating the law. The Karnataka High Court had also refused to stay the CCI probe.

"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 apex court said after hearing the submissions of Solicitor General Tushar Mehta, representing the CCI, and senior advocates Gopal Subramanium and A M Singhvi, appearing for Amazon and Flipkart respectively.

On being told by Singhvi that the time to respond to the CCI was expiring on August 9 itself, the bench extended the time by four more weeks which was objected to by Mehta.

Mehta said a week should be given to these firms as in COVID times people mostly shop online through these companies.

"At this stage, Dr. A.M. Singhvi, senior counsel submits that time to reply to the notice issued by the Office of the Director General, Competition Commission of India is going to expire on 9-8-2021 and prays for extension of time. 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," the top court ordered.

The Karnataka High Court had on July 23 rejected the plea of Amazon-Flipkart against the CCI probe for alleged violations of the competition law.

The high court had said that there was no need for the e-commerce firms to shy away from an inquiry if they were not involved in any violations.

"The inquiry cannot be crushed at this stage. If the appellants aren't involved in violations of any provisions of the competition law, they should not feel shy in facing an inquiry by the Competition Commission of India," it had observed.

The high court had also said the appeals were devoid of merits and substance and deserved to be dismissed.

Challenging the CCI's January 2020 probe order, the two e-commerce giants had approached the Karnataka High Court but a single judge bench of Justice P S Dinesh Kumar had dismissed the appeals, saying it would be unwise to prejudge the issues raised by the petitioners in these writ petitions at this stage and scuttle the investigation.