ED Issues Notice To Flipkart For Its Billion-Day Sale, May Slap Rs1000 Crore Penalty

Its seems like Flipkart's BigBillion Day Sale Blunder will last for some more time in news. In a most recent update and setback to Flipkart, ED (Enforcement Directorate) may soon impose a penalty on e-commerce giant after it conducted a probe on the company's trade practices. According to sources the amount of penalty may goes upto Rs.1000 crore.

On 6th October, Flipkart announced Big Billion Day sale where many customers reported that just before the sale goes up, all of sudden the prices of many of Flipkart's products were raised and then discounted which even after discounts are way higher than their regular prices. A day after sale, Flipkart however apologized to its customers for all glitches and clarified that higher prices of some of its commodities are due to technical errors which beyond control.

Moreover, ED, which probes financial irregularities, mainly money laundering and foreign exchange rule violations, is also probing other e-commerce companies such as SnapDeal.com and Amazon India.

There were many complaints from traders on Flipkart's massive discount sale on 6th October 2014. The government had assured that it will look into the concerns and take a call on whether more clarity is required on e-commerce retail business.

"We have received many inputs. Lot of concerns have been expressed. We will look into it," Commerce and Industry Minister Nirmala Sitharaman had said.

As per Hindustan Times, a highly placed sources at Enforcement Directorate said - "The quantum of irregularity has been calculated. The investigation is still on. We are yet to fix a penalty. We are probing other businesses as well because of which we cannot reveal what we have learned about Flipkart…It will alert others,” he said on condition of anonymity.

Flipkart has always been in the eyes of ED, earlier in August this year Enforcement Directorate slapped a show-cause notice on Flipkart over alleged FEMA violation. Also in 2013, a year after ED's probe began, Flipkart changed its business model, allowing buyers and sellers to deal independently through its platform.

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