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15 October 2014

Govt. issues notice to Flipkart for its billion-day sale, may impose Rs 1000 crore penalty

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Enforcement Directorate (ED) has issued a notice to Flipkart for its billion day sale and likely to impose Rs 1000 cr penalty for violating rules during it’s Big Billion Day Mega Sale on 6th October.This isn’t related to selling pendrives for Rs 1/- which went Out Of Stock within fraction of seconds.According to media reports, the ED is likely to impose a penalty of Rs 1,000 crore on the online shopping website for violating FDI rules. ED sources have said that Flipkart arranged money through FDI and arranging money in e-commerce through multibrand is violation of Foreign Exchange Management Act (FEMA).Flipkart’s mega sale, was Indian version of Black Friday sale in the USA where products are sold at throw away prices.Flipkart claimed to have crossed $100mn in sales during the billion day, though several brands have complained about Flipkart’s predatory pricing tactics.Meanwhile, Flipkart has issued a statement saying, “we are in complete compliance with the laws of the land and will cooperate with authorities when required.

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