In another setback to e-commerce majors Amazon and Flipkart, a division bench of the Karnataka High Court on Friday dismissed their appeals challenging the single-judge bench order permitting the Competition Commission of India (CCI) to proceed with the preliminary investigation.
A division bench headed by Justice Satish Chandra Sharma said that the investigation cannot be crushed at this stage.
"The appeals are nothing but an attempt to ensure that action initiated by the CCI... does not attain finality," a two-judge bench said while reading the decision in court.
"The appeals are devoid of merit, and deserve to be dismissed."
The CCI had directed the Director General to investigate the allegations made in the complaint by Delhi Vyapar Mahasangh of anti-competitive practices. The e-commerce entities had challenged this order dated January 13, 2020.
A single bench order on June 11 had upheld the order of investigation by CCI. The allegation was that the two companies had violated the provisions of the Competition Act 2002 by entering into anti-competitive agreements.
CCI is investigating charges that the two companies promote a few sellers on their platforms and use deep discounts to kill competition.
"This further reinforces that the CCI investigation should continue promptly," said Abir Roy of Sarvada Legal which filed the antitrust case against Amazon, Flipkart on behalf of a trader group.
The CCI investigation is the latest setback for the firms, which are also grappling with tougher foreign investment rules and accusations from brick-and-mortar retailers that they circumvent Indian law by creating complex business structures.
(With inputs from Reuters)
(Published 23 July 2021, 06:00 IST)
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