Business Desk, Amar Ujala, New Delhi
Published by: Dimple Aladhi
Updated Thu, 05 Aug 2021 12:40 PM IST
The Enforcement Directorate has issued show cause notices to Flipkart founders Binny Bansal, Sachin Bansal and investor Tiger Global. The company is accused of violating foreign investment laws.
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Alleged violation of foreign investment laws
Binny Bansal and Sachin Bansal are accused of violating foreign investment laws. The matter was reported to Reuters by three sources and an ED official. In this context, the ED official said that Flipkart is alleged to have attracted foreign investment and then the related party WS Retail sold goods to consumers on its shopping website. While it is prohibited under the law. The investigating agency is investigating Flipkart and Amazon for foreign investment laws.
Show cause notices issued to Sachin, Binny Bansal and investor Tiger Global
According to sources, in July, the Enforcement Directorate had issued show cause notices to Sachin Bansal, Binny Bansal and existing investor Tiger Global, asking why they should not be fined Rs 10,600 crore. Actually this case is from the year 2009 to 2015. The notice was issued under various sections of the Foreign Exchange Management Act (FEMA).
The parties have been given 90 days to respond to the notice. A Flipkart spokesperson has said that the company is complying with Indian laws and will fully cooperate with the company authorities. At the same time, the source said that WS Retail had ceased operations at the end of 2015 itself.
Company ready to bring IPO
It is to be known that US retail company Walmart had said that it is ready to bring an initial public offering (IPO) for its Indian e-commerce arm Flipkart. In this context, Walmart International President and CEO Judith McKenna said at the ‘DB Access Global Consumer Conference’ that both Flipkart and payments app PhonePe are doing well. “From the day we made the acquisition or investment, we have clarified that we are ready for IPO,” he said.