Navi Technologies IPO: List of ongoing litigations against founder Sachin Bansal

Picture Courtesy: Chandra R Srikanth

Sachin Bansal-led Navi Technologies has filed the Draft Red Herring Prospectus (DRHP) for a Rs 3,350 crore Initial Public Offering (IPO), and the company is also awaiting the Reserve Bank of India’s (RBI) nod for a universal banking license.

Bansal left Flipkart in 2018, which he had co-founded with Binny Bansal in 2007. The company was bought by US retail giant Walmart for $16 billion in the same year and within six months of leaving Flipkart, Bansal founded Navi Technologies in December 2018.

As Bansal plans the next big steps of his second innings as founder, the ghosts of his Flipkart days from four years ago continue to haunt him. Bansal has a total of eight litigations against him, six due to his past role as Flipkart’s founder and two filed by his wife Priya Bansal, one of those accusing Bansal and his family of dowry harassment.

Here is a list of all actions against him as per Navi’s DRHP.

ED show cause notice alleging FEMA violations

In July 2021, the Enforcement Directorate’s (ED) Chennai branch had issued a show cause notice against Sachin Bansal, Flipkart co-founder Binny Bansal and eight others including investor Tiger Global for alleged violation of regulations under the Foreign Exchange Management Act (FEMA). A report by news agency Reuters last year had said that the ED has sought an explanation as to why the company and its founders should not be charged a penalty of more than Rs 10,000 crore for alleged FEMA violations.

The case was related to an investigation into allegations that Flipkart violated laws after attracting foreign investment. As per the norms, a marketplace is not allowed to hold any inventory of its own after securing investments from foreign firms, but Flipkart related party WS Retail sold goods to consumers through its shopping website.

Bansal later moved the Madras High Court challenging and seeking a quashing of the Notice and the complaint filed by the ED. His petition is currently pending before the HC and no steps have been taken by the ED following the notice.

Cases in personal capacity

Bansal’s wife Priya Bansal had filed a criminal case against him and his family alleging dowry harassment in February 2020. Bansal moved the Karnataka High Court to quash the FIR and complaint against him and was given relief by the court in the matter. Subsequently, Priya Bansal filed a special leave petition before the Supreme Court challenging the order, which is currently pending.

Besides this, Priya Bansal had also moved Bengaluru’s Family Court seeking sole custody of their minor son and asking Bansal to pay Rs 2 lakh monthly for their son. Bansal has filed objections against the petition and the matter is pending in court.

Cases due to past association with Flipkart

Besides the above matters, six cases against Bansal are ongoing in various courts across the country filed between 2015 and 2021. These cases against him are due to his past association with Flipkart as co-founder.