SC says Flipkart known for creating monopolies, appoints amicus

The Supreme Court on Tuesday said e-commerce major Flipkart was known for creating monopolies and expressed concern over the fate of smaller players in the market. A bench of Justices Surya Kant and N Kotiswar Singh appointed an amicus curiae to assist it in the adjudication of the dispute arising out of an National Company Law Appellate Tribunal (NCLAT) order asking the fair trade regulator Competition Commission of India (CCI) to initiate probe against Flipkart for an alleged use of its dominant position.

A bench of Justices Surya Kant and N Kotiswar Singh was surprised that the complainant All India Online Vendors Association (AIOVA) which alleged unfair trade practices by Flipkart was nowhere to be found as its lawyers had no instructions from the body.

Advocate Udayaditya Banerjee, appearing for AIOVA, said it was possible that the organisation was disbanded or no longer existed.

The bench told Flipakart's counsel that it would like to examine the issue of creating a monopoly.

"We want big players to come and invest here but at the same time we are worried about the dragon's mouth...it is a serious issue and we have to keep the interest of consumers and small players in mind. Some balancing authority is needed," the bench observed.

The counsel for Flipkart said due to the platform, many small vendors were able to take their businesses to the national level.

Justice Kant said sometimes Flipkart offered so much discount that it disrupted the business of small players and the balance of the market.

It asked Banerjee to assist the court in the matter saying otherwise it would be an uneven fight.

The bench said it did not matter whether the complainant AIOVA was before it or not as it would like to examine the issue in detail.

The bench was also critical of CCI being represented through lawyers and asked why a quasi judicial body was being represented in the case.

"It has passed the order, good or bad. It's (CCI) job is over. Why should the authority be here in a case? Tomorrow, we can't ask the high court to be here in every case," Justice Kant said.

The top court was informed that due to an order of the apex court, the CCI was represented in every case.

The bench posted the matter in August.

Flipkart challenged the March 4, 2020 order of the NCLAT asking the CCI to initiate the investigation against Flipkart for an alleged use of its dominant position.

The appellate tribunal set aside the an order passed by the CCI which absolved Flipkart of unfair practices using its dominant position.

The appellate tribunal directed the CCI to ask its probe arm director general to investigate the allegations.

In November 2018, the AIOVA approached the CCI alleging abuse of market dominance by the e-commerce major.

AIOVA alleged abuse of market dominance against Flipkart India Pvt Ltd, which is into wholesale trading/distribution of books, mobiles, computers and related accessories, and e-commerce marketplace Flipkart Internet Pvt Ltd.