Binny Bansal Not To Pursue Complaint Against Woman Who Alleged Misconduct

Flipkart founder Binny Bansal has reportedly decided not to pursue the complaint against the ex-Flipkart employee who had accused him of ‘serious personal misconduct’.

Earlier this month, Bansal was dethroned from his position as Flipkart Group CEO as parent company Walmart believed that these allegations were not mentioned to them in therun-up to the $16 Bn acquisition deal.

“Binny Bansal had filed a police complaint against the accuser for blackmailing and levelling false allegations against him. Following due process, the police informed him that when called to furnish her statement, the woman apologised for making these allegations to Walmart,” said a source to ET.

Binny has however reserved his right to reopen the case if and when necessary. The complaint was filed at Koramangala Police Station last week, soon after the cofounder resigned from his position at Flipkart Group.

What’s The Case?

According to reports, Binny and the Bengaluru-based woman, who was a former employee by then, reportedly began their relationship in 2016 and ended it a few months later. A few media sources suggest that the said woman also demanded certain payments from Bansal, to which he acceded.

It is not clear as to why Bansal did not approach the police on that occasion. Later in May 2018, after the acquisition, she again made a demand for a payment. When Bansal did not heed her demand, she reached out to Walmart CEO Doug McMillon alleging sexual assault in July.

Walmart being the majority shareholder in Flipkart Group (81.3%) started investigating the case as soon as it received the complaint. It also hired international law firm Gibson Dunn to conduct an independent inquiry into the matter.

While the investigation did not find evidence to corroborate the complainant’s assertions against Binny, it did reveal other lapses in judgement, particularly a lack of transparency,  on how Binny responded to the situation, according to a Walmart media statement on November 13.

Is Walmart’s Decision Justified?

By accepting Bansal’s resignation, Walmart showed that it has a zero-tolerance policy for such issues, but taking into account certain factors the decision may be termed as harsh.

• First, the women was not an employee at Flipkart during the span of the relationship
• Second, the women did not file an official complaint against Bansal and there was no court case or FIR filed on the matter
• Third, during the investigation, Bansal received the clean chit
• Fourth, after filing the police complaint, the woman employee apologised for reaching out to Walmart

Walmart, however, said that “Binny has been an important part of Flipkart since cofounding the company, but recent events risked becoming a distraction and Binny has made a decision to step down.”Overall, from a corporate governance perspective, Binny Bansal is facing the consequences of a personal relationship outside the organisation.

What’s Happening At Flipkart Now?

Kalyan Krishnamurthy has continued to be the CEO of the Flipkart, and Flipkart subsidiary Jabong has now been merged with Myntra. Smriti Singh has been hired as its Chief Human Resources Officer (CHRO), a position which was vacant for about 18 months. Walmart is also bringing four of its key executives to the team leading the Indian ecommerce unicorn.

Finally, the resignation could signal an end to the golden era of for Flipkart – the poster boy for Indian ecommerce – as it now becomes the subsidiary of US-based global retailer Walmart, led by American senior executives.

[The development was reported by ET.]