A fresh round of legal battle began between e-commerce majors Flipkart, Amazon and the Competition Commission of India (CCI) on Friday as a Division Bench began hearing appeals against the June 11 verdict of a single judge bench, which had upheld CCI’s decision to investigate whether the two companies have anti-competitive agreements with sellers contrary to the law.
A Division Bench comprising Justice Satish Chandra Sharma and Justice Nataraj Rangaswamy adjourned further hearing on the appeals after partly hearing the arguments on the appeal filed by Flipkart Internet Pvt. Ltd.
Too many people
The Bench could not commence hearing in the morning session as some of the senior advocates representing the companies could not login to the video conference hearing, as the number of participants exceeded the limit of 100 fixed for each court hall.
A large number of advocates and others persons associated with the two companies apart from media persons and the advocates waiting for several other cases listed before the Bench had logged in together. The hearing commenced at 2.30 p.m. after the Court allowed participation of only the senior advocates and a few advocates assisting them.
Later, Senior Advocate Harish Salve, appearing for Flipkart, argued that the CCI was wrong in invoking its jurisdiction under Section 3(4) of the Competition Act, 2002, as it applies only to anti-competitive agreements amongst enterprises or persons at different stages or levels of the “production chain,” and not applicable to Flipkart as it is not part of “production chain” as it has no agreements with manufacturers.
‘Electronic malls’
He contended that a seller selling his product exclusively with Flipkart cannot be treated as part of the production chain as it is for the seller to decide where he wants to sell products. A seller may wish to sell his products only at a particular mall or shop located in a particular city, etc., and e-commerce portals are nothing but “electronic malls,” Mr. Salve contended.
The status of “assured sellers” or “preferred sellers” given to some sellers is due to commercial success of those sellers and will not impact as “assured” or preferred” sellers sell a variety of products and don’t sell only one product, he argued. The Bench will continue hearing on Monday.
