It has sought an inquiry into the affairs and transactions of all FDI recipient companies and stop operation of those found to be directly or indirectly carrying out e- commerce in retail sector.
The petitioner also said that "100 per cent FDI is permissible through automatic route for buying and selling by a company through the e-commerce platform but this is subject to the condition that such companies would engage only in B2B e-commerce as against business to consumer (B2C) pattern and not in retail trading".
The plea had alleged that "in order to mislead and confuse the competent authorities, the said e-commerce companies are creating a conundrum of group websites/companies amongst the closely held/managed sister companies/business concerns and thereby causing tremendous loss to the government exchequer."
Last month, the government gave the green light to 100% FDI in the marketplace format of e-commerce retailing with a view to attract more foreign investments.
According to the guidelines issued by the Department of Industrial Policy and Promotion (DIPP) on FDI in e-commerce, FDI has not been allowed in inventory-based model of e-commerce. (SH)
Fibre2Fashion News Desk – India