Seller Body Files Compliant Against Flipkart with CCI

A complaint has been filed with the Competition Commission of India (CCI) against Flipkart by the Forum for Internet Retailers, Sellers & Traders (FIRST), an affiliate of the SEBI-registered India SME forum, accusing the entity of anti-competitive arrangements and abuse of dominant position. The complaint accuses Flipkart of distorting competition by running a ‘recurring subsidy pool’ providing benefits to select retailers and excluding others from the marketplace system.

The allegations state that Flipkart has, in substance, operated on an inventory-based model while presenting itself as a marketplace. It is alleged that this has been achieved by supplying goods to a group of 33 preferred sellers, including OmniTech Retail, SuperCom Net and TrueCom Retail, at prices below the cost of procurement. These sellers then allegedly sell the goods on the marketplace through independent sellers at below-cost prices. It is further alleged that Flipkart has created a “self-replenishing reservoir of funds”, estimated at approximately ₹3,000 crore annually, by reducing or avoiding GST liabilities in relation to its logistics and fulfilment operations. According to the allegations, these funds are used to support the below-cost pricing strategy. As a result, the financial and operational support allegedly provided by Flipkart enables a select group of preferred sellers to consistently offer deep discounts across the marketplace.

In a similar complaint filed in 2019 by the Delhi Vyapar Mahasangh, the CCI had submitted investigation reports in August 2024 concluding that Amazon and Flipkart had engaged in anti-competitive practices, including preferential treatment of select sellers, exclusive arrangements, and deep discounting. The reports alleged that Amazon had six preferred sellers and Flipkart had 33, all of whom received preferential treatment on their respective platforms in violation of competition law. These sellers were also provided marketing, warehousing, and other support services at nominal cost, and the proceedings remain pending before the Commission. However, as of July 2026, the CCI has not issued a final order on the investigation. Nonetheless, several of the current allegations by FIRST mirror those contained in the DG’s 2024 investigation report, including the alleged support extended to 33 preferred sellers.

Another complaint dating back to 2018, filed by the All India Online Vendors Association (AIOVA) against Flipkart, alleging preferential treatment to certain buyers and abuse of dominant position, was decided in favour of Flipkart but later overturned by the NCLAT in March 2020. The Supreme Court, in February this year, remitted the matter to the NCLAT for a fresh decision, asking it to reassess the issue since the 2020 ruling relied on observations made during income tax proceedings, but those findings were later overturned by the Income Tax Appellate Tribunal.

According to media reports, in October 2025, the Enforcement Directorate offered to close its probe into alleged violations of the Foreign Exchange Management Act (FEMA) by Flipkart, subject to certain conditions. However, these investigations seem to be independent of the CCI’s competition law proceedings.