The Forum for Internet Retailers, Sellers and Traders (FIRST), an association of online retailers under the India SME Forum, has approached the Competition Commission of India (CCI) alleging that Flipkart engages in predatory and discriminatory business practices that distort competition on its marketplace.
In a complaint accessed by NDTV Profit, FIRST alleged that Flipkart's GST "avoidance" has created a pool of nearly Rs 3,000 crore, enabling the e-commerce company to fund deep discounts and undercut independent sellers.
The complaint also alleged that Flipkart gives preferential treatment to 33 select sellers, who are able to list products on the platform at below-cost prices, putting other marketplace sellers at a competitive disadvantage.
FIRST further claimed that Flipkart is effectively operating an inventory-led model, despite being permitted to function only as a marketplace under India's foreign investment rules.
The retailers' body has urged the CCI to investigate Flipkart, its parent Walmart, and group companies Myntra, Ekart and Cleartrip for alleged violations of the Competition Act.
Flipkart did not respond to NDTV Profit's queries till the time of publication.
The complaint adds to Flipkart's woes as it prepares for a public listing on the bourses. This is also yet another move in the regulatory scrutiny faced by large e-commerce platforms over allegations of preferential treatment, deep discounting and marketplace neutrality.
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