ED raids on e-commerce sellers linked to Amazon, Flipkart a positive step: CAIT

Amazon, Flipkart sellers raided by ED across India amid money laundering allegations

The Confederation of All India Traders (CAIT), representing over 8 crore retail traders, has expressed strong support for the Enforcement Directorate’s (ED) recent raids on multiple sellers across India connected to e-commerce giants like Amazon and Flipkart. The raids are part of an investigation into alleged money laundering activities linked to these platforms.

Praveen Khandelwal, Secretary General of CAIT and BJP MP hailed the ED’s actions as a “step in the right direction” and emphasized that no entity, regardless of its stature, should be allowed to bypass India’s legal framework. “India is a vibrant democracy governed by the rule of law, and no one can disregard the Constitution and laws of the land,” Khandelwal said in an interview with news agency IANS.

The ED’s nationwide search targeted subsidiaries and sellers associated with major e-commerce players. The raids took place across several cities, including Delhi, Mumbai, Hyderabad, and Bengaluru, with sources confirming that the investigation is focused on violations related to the Foreign Exchange Management Act (FEMA). The ED is probing potential money laundering activities facilitated by online e-commerce platforms.

Khandelwal pointed out that CAIT, along with other trade bodies, has raised concerns for years about the impact of e-commerce platforms on small businesses. “The ED’s actions are a welcome move, and it follows earlier steps taken by the Competition Commission of India (CCI), which had issued penalty notices to Amazon, Flipkart, and their preferred sellers for anti-competitive practices that harm small traders and Kirana stores,” Khandelwal added.

The raids are part of an ongoing investigation into the financial practices of e-commerce sellers. However, neither the Enforcement Directorate nor the e-commerce companies have released official comments on the developments.

In light of the recent raids, Khandelwal reiterated the need for swift action against anti-competitive practices, particularly from quick-commerce companies such as Blinkit, Swiggy, and Zepto. He urged both the CCI and the ED to continue their efforts to safeguard the interests of small traders and shopkeepers, who have faced challenges due to violations of foreign direct investment (FDI) rules and unfair competition.

“As we have repeatedly pointed out, the livelihoods of small shopkeepers are at stake. We hope that the law will take its rightful course to protect their interests,” Khandelwal concluded.

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