The investigation into Flipkart Group chief Binny Bansal that led to his resignation on Tuesday stemmed from an Allegation of Sexual Assault that dates back a few years, a person familiar with the matter told Reuters.

“In late July … an allegation came to us. It was a claim of sexual assault against Binny Bansal,” the source said, adding the individual concerned was a former Flipkart associate who was not with the company at the time of making the allegation.

“The investigation could not corroborate the allegation. It did, however, surface a lack of transparency on Binny’s part.”

Bansal has strongly denied the Sexual Allegation, according to a separate statement by Flipkart and its main shareholder Walmart.

In a startling turn of events, the chief executive officer of Flipkart Group, the Indian e-commerce giant under Walmart Inc, has resigned. Walmart confirmed on Tuesday that Binny Bansal’s departure follows an internal investigation into allegations of “serious personal misconduct.”

While specifics were not detailed, two individuals familiar with the matter indicated that these allegations stemmed from a claim of sexual assault. Bansal, a prominent figure as one of the co-founders of Flipkart, took over as CEO in 2016 and had recently assumed the role of chairman and group CEO earlier this year.

Walmart’s acquisition of a majority stake (approximately 77%) in Flipkart for $16 billion was a strategic move aimed at expanding its presence in India’s expansive consumer market and competing against the likes of Amazon.

Bansal, in a note to Flipkart employees seen by Reuters, mentioned stepping down due to recent events related to a misconduct claim against him. He denied the Sexual Allegations, stating they left him stunned, and emphasized that an independent law firm’s thorough investigation had found the claims uncorroborated.

However, while the investigation didn’t substantiate the specific allegations, it did uncover judgment lapses and a lack of transparency in Bansal’s handling of the situation, as acknowledged by Walmart. Neither Bansal nor his representatives provided further comment, and Flipkart remained silent in response to requests for clarification.

The nature of the accusation, brought to Walmart’s attention in late July, dated back a few years and was made by a former Flipkart associate not employed at the time of the alleged incident. Walmart, conducting its own investigation, noted a lack of transparency in Bansal’s responses to the matter but found no evidence to support the claims.

Amidst these developments, Bansal, a well-known entrepreneur in India’s business landscape, remains a shareholder in Flipkart. Walmart, in conjunction with Flipkart, had been contemplating a succession plan, now hastened due to recent events.

Kalyan Krishnamurthy, overseeing Flipkart’s main e-commerce operations, assumes a broader leadership role encompassing Myntra and Jabong. Ananth Narayanan, CEO of Myntra and Jabong, will continue in his position, now reporting to Krishnamurthy.

The exit of Binny Bansal, along with the broader context of #MeToo movement discussions gaining momentum in India, underlines the significance of corporate responses to allegations of misconduct. This transition in leadership signals a pivotal moment for Flipkart, Walmart, and the e-commerce landscape in India.

The investigation into Flipkart Group chief Binny Bansal that led to his resignation on Tuesday stemmed from an allegation of sexual assault that dates back a few years, a person familiar with the matter told Reuters.

“In late July … an allegation came to us. It was a claim of sexual assault against Binny,” the source said, adding the individual concerned was a former Flipkart associate who was not with the company at the time of making the allegation.

The investigation could not corroborate the Sexual allegation of Binny. It did, however, surface a lack of transparency on Binny’s part.”

Binny Bansal has strongly denied the allegation, according to a separate statement by Flipkart and its main shareholder Walmart.

Six months after Walmart acquired Flipkart, India’s top e-commerce firm, both its founders have exited — one in a surprising move.

On November 13, Flipkart’s CEO, Binny Bansal, resigned immediately amidst a probe into “serious personal misconduct.”

Though ambiguous, insiders revealed the misconduct relates to alleged sexual harassment by Binny. Emails to both firms seeking details went unanswered.

After Walmart’s $16 billion acquisition in May, a probe into Bansal’s actions began in July. The complainant previously raised concerns with Flipkart leadership but saw no progress, an anonymous Flipkart employee disclosed.

Though the accuser left before the acquisition, Walmart initiated an investigation through a law firm.

Binny resigned following an independent investigation’s findings, admitting lapses in judgment and transparency but denying the allegations.

Unlike Sachin Bansal, who sold his 5.5% stake after leaving, Binny retains 5% ownership and stays on the board.

In an email to Flipkart staff, Binny denied the accusations but acknowledged errors in judgment, citing personal challenges.

The sudden departure shocked Flipkart’s employees, who saw no signs until recently. Binny and Sachin Bansal, IIT-Delhi alumni, built Flipkart into a prominent e-commerce giant over a decade.

While rumors swirled after Sachin’s exit, Binny denied any plans to leave. His resignation was hastened due to personal events.

Flipkart India in its annual filing of the last financial year disclosed it received three Sexual Harassment complaints. The documents sourced by business intelligence platform, Paper.vc, showed the company had disposed off one such complaint. Interestingly, the action taken against the complaint filed was that there was conciliation with an undertaking and apology by the respondent.]An official query sent to Flipkart to ascertain if this particular case related to former co-founder Binny Bansal remained unanswered. The other two complaints were pending for over three months till the end of March 31 this year. However, according to sources in Flipkart even the remaining two complaints have been resolved. In November 2018 after the exit of Sachin Bansal and soon after the Walmart -Flipkart deal, his close friend, co-founder and group CEO of Flipkart, Binny Bansal resigned following an investigation by the company into alleged ‘serious personal misconduct’. The company in a statement had then said “Earlier today, Binny Bansal announced his resignation as CEO of Flipkart Group, effective immediately. Binny has been an important part of Flipkart since co-founding the company, but recent events risked becoming a distraction and Binny has made a decision to step down.”

However the company did not further disclose the nature of Binny Bansal Sexual Allegations that were leveled against him. Announcing his exit from the company as the group CEO of Flipkart, Binny Bansal had said that he would remain to be large shareholder in the company and will continue to serve as a member of the Board of Directors. In an emotional email that though he was contemplating stepping away from his current role for a while, his decision was accelerated by certain personal events that have taken place in the recent past.