The Delhi HC asks ED to submit probe details of e-commerce cos

The Delhi High Court seems to be turning on the heat on e-commerce companies. The Court has directed the Enforcement Directorate (ED) to submit details of the probe it had initiated against e-commerce firms.

The ED had begun investigating 14 e-commerce companies like Flipkart and Snapdeal, after a plea in the Delhi HC had alleged violation of FDI norms.A petition was filed by the All India Footwear Retailers Association in the Delhi High Court, allegating that the e-Commerce companies are flouting foreign direct investment (FDI) norms with respect to multi-brand retail and as a result were skewing the market metrics in their favour. It is on the back of this petition that the ED had begun probe against 14 leading e-Commerce companies. The government on Friday made two key submissions - one, they submitted before Delhi High Court that the ED investigation is in its preliminary stages. The second key submission was that these companies have presented themselves to be following a marketplace model. The government however clarified that this marketplace model is not recognised as per its FDI policy. Meanwhile, the Reserve Bank of India (RBI) has shifted the onus back on to the government with respect to regulation of this space. The RBI has clarified that as far as enforcement of Foreign Exchange Management Act (FEMA) rules and regulations are concerned it is something that lies on the shoulders of the Department of Industrial Policy & Promotion (DIPP).However as of now the e-Commerce companies are not out of the woods. They continue to be under judicial scrutiny and this matter will be taken up after six weeks.