CAIT has sent a rebuttal to Amazon’s clarification on its legal expenses

Our Bureau | | Updated on: Oct 01, 2021
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Amazon had clarified that its legal fees did not amount to ₹8,546 crore during FY19 and FY20

In a recent letter sent to Minister of Commerce and Industry Piyush Goyal, Confederation of All India Traders (CAIT) said that Amazon’s clarification, on alleged bribery charges on its lawyers, is a blatant lie.

“At the outset we would like to submit before you that Amazon’s clarification on legal professional charges is a blatant lie in order to hide their illegal business practices and is inconsistent with regulatory filings of Amazon and its group companies. This clarification raises more questions than answers and therefore, a serious investigation is urgently required,” the letter read.

Amazon’s clarification

In a clarification letter sent on September 28, Amazon said Amazon India Limited is not connected with Amazon’s Indian subsidiaries. The global e-commerce giant said its legal fees did not amount to ₹8,546 crore during FY19 and FY20, as quoted in the media. In its statement, Amazon disclosed that the actual legal fee expenses for the fiscal year ending March 2020 was approximately ₹52 crore.

Also read: Amazon writes to Piyush Goyal countering CAIT’s allegation on legal expense

In its recent letter, CAIT has noted that ‘India Today’ had clarified that it had misread Amazon’s legal professional charges as ₹8,546 crore and that the actual figure was ₹5,220 crore. Further, CAIT has verified the legal professional charges mentioned by Amazon and its group companies (other than Amazon India Limited) in their regulatory filings before the Ministry of Corporate Affairs (MCA).

Based on these MCA documents, CAIT noted that the total legal charges incurred by five Amazon group companies over the period of three years (FY17-18, FY 18-19, FY19-20) were ₹5,262 crore. These group companies include Amazon Retail India Private Limited, Amazon Seller Services Private Limited, Amazon Transportation Services Private Limited, Amazon Wholesole (India) Private Limited, and Amazon Internet Services Private Limited. The trade body has said that there is a need for Amazon to clarify which legal professionals has the company paid these legal fees to.

“It is only expedient in public interest that an urgent and time-bound inquiry by CBI must be ordered into Amazon India’s self-admitted charges. It is also suggested that Amazon India’s operations, in all forms, must be suspended before it does any more damage or resorts to any other financial irregularity. A strong example must be set here so that it proves to be a deterrent for Amazon and companies like it from taking Indian law and government agencies for granted,” Praveen Khandewal, National Secretary General of CAIT, added in the letter.

Last month, a whistleblower complaint has alleged that monies given by Amazon to its legal representatives was being funnelled into bribes. In an earlier response, Amazon has put out a statement saying that it “takes allegation of improper actions seriously, investigate them fully and take appropriate action.”

Published on October 01, 2021

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