Ratan Tata-backed GOQii to take Flipkart to court over deep discounting

Smart wearables maker GOQii Technologies is planning to take home-grown e-commerce marketplace Flipkart to court over violation of sales agreement.

GOQii, reaching out to government departments such as Department for Promotion of Industry and Internal Trade (DPIIT) and the Competition Commission of India (CCI), said that Flipkart is offering deep discounts from early this month, selling products at much below the cost price and against the sales agreement whereby any such discounting is offered at mutual terms.

GOQii Technologies founder Vishal Gondal said that he reached out the marketplace many times to take off the discounts from their products but no actions were taken even after legal notice.

In the notice quoted by ET report, it alleged that GOQii products are sold at an unauthorised 70 to 80% discount, which is predatory pricing by Flipkart and clearly an anti-competition practice under Competition Act 2002.

Entrackr also visited Flipkart site to check offered discounts of GOQii products.

The marketplace, unlike Amazon, has been influencing the sale price of GOQii services and is creating a non-level playing field, it added.

The deep discounting has led to the cancellation of our corporate orders and made our partners unhappy, Gondal added. He also tweeted about the same explaining how the deep discount is hurting startups.

In response to the allegations, Flipkart told Entrackr that it is compliant with all Indian laws and does not decide the prices at which independent sellers sell their products on its marketplace platform.

We are reviewing the allegations raised by the seller, said Rajneesh Kumar, Chief Corporate Affairs Officer, Flipkart Group.

However, in the last three months, marketplaces mainly Amazon and Flipkart have dropped deep discounting on several products. They are reportedly no longer selling below the cost price even though there may be discounts on private labels of the marketplaces.

UPDATE: The post has been updated with Flipkart response post publication of the report.