CAIT seeks govt audit into business models of e-commerce firms Amazon, Flipkart

In a letter to Goyal, CAIT said that since Amazon and Flipkart consider brands responsible for offering deep discounts, the government should convene a meeting with major brands to ascertain the truth

Press Trust of India October 15, 2019 11:55:23 IST
CAIT seeks govt audit into business models of e-commerce firms Amazon, Flipkart
  • In a letter to Goyal, CAIT said that since Amazon and Flipkart consider brands responsible for offering deep discounts, the government should convene a meeting with major brands to ascertain the truth

  • "The business model of both companies (Amazon and Flipkart) should be audited by the government to arrive at real conclusion," it said in the letter

  • CAIT Secretary General Praveen Khandelwal said the body apprehends that in order to escalate the value of the companies, the investors are funding their losses, which enables them to offer huge discounts

New Delhi: Traders' body CAIT on Monday urged Commerce and Industry Minister Piyush Goyal to initiate an audit into the business model of e-commerce firms Amazon and Flipkart.

In a letter to Goyal, CAIT said that since Amazon and Flipkart consider brands responsible for offering deep discounts, the government should convene a meeting with major brands to ascertain the truth.

"The business model of both companies (Amazon and Flipkart) should be audited by the government to arrive at real conclusion," it said in the letter.

Last week, senior officials of the Department for Promotion of Industry and Internal Trade (DPIIT) held a meeting with the representatives of Amazon and Flipkart following a complaint by the Confederation of All India Traders (CAIT).

CAIT seeks govt audit into business models of ecommerce firms Amazon Flipkart

Representational image. Reuters.

"...both Amazon and Flipkart in a clandestine manner refuted the issues raised by us even after showing relevant evidences. For offering huge discounts on their portals, they have categorically said that it is the brands which are offering discounts and they (Amazon and Flipkart) have no role in it. To other concerns, they did not own the responsibility citing their own explanations based on several flimsy grounds," CAIT said in the letter.

CAIT Secretary General Praveen Khandelwal said the body apprehends that in order to escalate the value of the companies, the investors are funding their losses, which enables them to offer huge discounts.

"It appears that it is not a business model but a valuation game of investors who are hugely benefitted when they exit their investment at a time when the valuation of the company becomes too high," he added.

Updated Date:

also read

A Hero movie review: Asghar Farhadi delivers a tale about ethics and integrity with a fairly engaging script
Entertainment

A Hero movie review: Asghar Farhadi delivers a tale about ethics and integrity with a fairly engaging script

A Hero lacks the verve of A Separation and the emotional gravitas of The Salesman but as a generic social drama, it has its heart in the right place.

As We See It review: Amazon Prime Video show throws a thoughtful lens at life on the spectrum
Entertainment

As We See It review: Amazon Prime Video show throws a thoughtful lens at life on the spectrum

In As We See It, characters on the spectrum are defined not by autism alone but by their likes and dislikes, fears, challenges, workplaces, and aspirations

Reliance Industries doubles down on media business; ready to take on Amazon, Netflix, Hotstar
Business

Reliance Industries doubles down on media business; ready to take on Amazon, Netflix, Hotstar

The company is also planning to raise funds upwards of Rs 12,000 crore from financial investors, according to industry sources, to beef up the media business