New Delhi: The Enforcement Directorate has issued a notice seeking an explanation from Flipkart, its founders and nine others to avoid a $1.35 billion penalty in an alleged violation of foreign investment rules.
ED is reported to have found that their foreign investments between 2009 and 2015 had violated the FEMA rules.
Responding to the ED notice, Flipkart said that it will cooperate with the agency in the probe into the alleged foreign investment rules violation that the company is in with Indian laws and regulations, including foreign direct investment (FDI) regulations.
According to the ED, Flipkart generated foreign investment and a related party and sold goods of the party through its e-retail platform which was a violation of the rule.
The agency has been investigating e-commerce giants Flipkart and Amazon.com Inc for quite some time for allegedly bypassing foreign investment laws that strictly regulate multi-brand retail and restrict such companies to operating a marketplace for sellers.