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Walmart backed Flipkart served a $1.35 billion fine from the ED

Notice under various sections of the Foreign Exchange Management Act (FEMA) was issued to 10 people last month that includes Flipkart, its founders Sachin Bansal and Binny Bansal, among others.

Walmart backed Flipkart served a $1.35 billion fine from the ED

The Enforcement Directorate has slapped a $1.35 billion or Rs 10,600 crore penalty on the Walmart backed e-commerce giant Flipkart over alleged foreign investment laws violation.

This is the biggest show-cause notice under the Foreign Exchange Management (FEMA) Act.

Flipkart's founders Sachin Bansal and Binny Bansal as well as its investor Tiger Global received a show-cause notice in July by the agency. Flipkart attracted foreign investment and a related party, WS Retail, then sold goods to consumers on its shopping website, which was prohibited under law, the report mentioned.

Walmart-owned company and its executives will now undergo adjudication that will be conducted by a Special Director-rank officer of the agency based in Chennai.

Indian regulatory authorities have been keeping a close eye on e-commerce platforms Flipkart and Amazon. Both are already facing anti-trust investigations.

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