In a very important communication sent to GovernmentConfederation of All India Traders (CAIT( has explained with facts that Amazon’s clarification on legal & Professional charges are completely baseless and we reiterate their demand for a CBI investigation against Amazon’s alleged bribery scandal. Text of CAIT Representation is as follows:

 Confederation of All India Traders

Ref No. 3287/1/50

01st October 2021

Shri Piyush Goyal,
Hon’ble Minister of Commerce and Industry,
Government of India,
Udyog Bhawan,
New Delhi

Subject: Urgent investigation against Amazon for irregularities in Legal Professional Charges

Dear Sir,

This is in continuation of our earlier letter dated September 20, 2021 and a clarification issued by Amazon on September 30, 2021.

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 ( The extracts of their filings is enclosed at Annexure I). This clarification raises more questions than answers and therefore, a serious investigation is urgently required.

The media report dated September 21, 2021 in “India Today” initially showed the following expenses under the head of “Legal Professional Charges”

Company (Parent:
Amazon.com, Inc.)
Legal Charges as reported by India Today FY 19-20 (in Cr) Legal Charges as reported by India Today FY 18-19 (in Cr) Total Income FY 19-20 (in Cr) Total
Income FY
18-19 (in
Cr)
AMAZON INDIA LIMITED 1072  

3493

0 0
AMAZON RETAIL INDIA PRIVATE LIMITED 208 64 725 150
AMAZON SELLER SERVICES PRIVATE LIMITED 1968 1448 11000 7800
AMAZON TRANSPORTATION
SERVICES PRIVATE LIMITED
106 55 2960 2078
AMAZON WHOLESALE (INDIA) PRIVATE LIMITED 66 43 3385 11250
AMAZON INTERNET SERVICES PRIVATE LIMITED 23 2737
Total 3420 5126 18070 24015
Total of 2 years 8546 42085
Legal Professional Charges as % of Total Income 20.3%

Subsequently, “India Today” had clarified that it had misread Amazon’s legal professional charges as INR 8546 Crore and that the actual figure was INR 5220 Crore.

Further, Amazon in its clarification on September 30, ASSPL has disassociated itself from one company i.e. Amazon India Limited (AIL) meaning thereby that the remaining companies, as reported by India Today, are related to ASSPL.

Pursuant to reports by prominent sections of the media, including India Today, we have verified the legal professional charges mentioned by Amazon and its group companies (other than Amazon India Limited) in their regulatory filings before Ministry of Corporate Affairs (MCA). These are represented in the table below:

Company      (Parent: Amazon.com, Inc.) Legal Charges as per MCA records FY 19-20     (in
Cr)
Legal Charges as per
MCA records
FY 18-19 (in Cr)
Legal Charges as per MCA records FY 17-18 (in Cr) Total Income FY 19-20 (in Cr) Total Income FY 18-19 (in Cr) Total Income FY 17-18 (in Cr)
AMAZON RETAIL INDIA PRIVATE LIMITED 207 63 1 726 140 0
AMAZON SELLER SERVICES PRIVATE LIMITED 1967 1448 1145 11028 7778 5018
AMAZON TRANSPORTATION SERVICES PRIVATE LIMITED 106 54 26 2964 2079 1584
AMAZON WHOLESALE (INDIA) PRIVATE LIMITED 65 42 43 3388 11250 12246
AMAZON INTERNET SERVICES PRIVATE LIMITED 45 23 27 4216 2740 1235
Total 2390 1630 1242 22322 23987 20083
Total of 3 years 5262 66392

Hence, in pursuance of the clarification given by Amazon and the verified data from their regulatory filings, there is an impending need for Amazon to clarify the following:

1. Towards which legal professionals, Amazon had spent INR 5262 Crore?

2. Further, even if one were to accept Amazon’s clarification that the legal charges were merely INR 52 Crore, Amazon must clarify without delay to whom was the remainder i.e. INR 5210 Crore (INR 5262 Crore minus INR 52 Crore) paid as professional charges?

Sir, Amazon is hell bent on discrediting our Prime Minister Shri. Narendra Modiji’s tireless efforts to protect small traders and safeguard their interests. Amazon’s business practices have instead been destroying these very traders and has caused large scale unemployment in the sector.

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.

We look forward to your kind consideration and hope that you will take immediate action against Amazon for its actions.

Thanking you. With kind regards

Yours truly

Praveen Khandelwal
National Secretary General
Confederation of All India Traders

*****

Disclaimer: The contents of this article are for information purposes only and do not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc before acting on the basis of the above write up.  The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that Author / TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

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