Walmart's deal to buy Flipkart came with an interesting caveat

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Walmart's big bucks could go a long way in Flipkart's fight against Amazon in one of the world's fastest-growing e-commerce markets.

The $16 billion deal announced between U.S. retail giant Walmart and India's Flipkart last week has come under the scanner of the income tax (I-T) department. The Jack Ma-led group owns a majority stake in the e-commerce marketplace.

Softbank: Japan's SoftBank is expecting returns of about USA $4 billion as part of the Walmart-Flipkart transaction.

In the Walmart-Flipkart deal, the revenue department will go through the share purchase agreement to ascertain the goal of investment and the emanating gains.

Walmart has told Flipkart's leadership team to not worry about an IPO anytime soon, according to two people familiar with the matter.

The deal, which still needs regulatory approvals in India, has to close by March 09, 2019, failing which it could be terminated, as per the SEC filing.

On May 09, the Swadeshi Jagran Manch (SJM) wrote a letter to prime minister Narendra Modi opposing the deal. This has turned Indian e-commerce battle into three-way involving Walmart, Amazon and Alibaba, which is backed by the Japanese conglomerate. The SJM is an affiliate of the Hindu nationalist association, Rashtriya Swayamsevak Sangh (RSS), which is the ideological mothership of the ruling Bharatiya Janata Party.

However, in a catch of this speculation, Softbank can invest in Paytm Mall only if it finalized its exit from Flipkart.

Softbank backed Snapdeal in the hope that the e-tailer would challenge Flipkart's dominance in the e-commerce space.

Some of the company's minority shareholders following Flipkart's tie-up with Walmart include Tencent Holdings, Tiger Global Management, Microsoft, and company cofounder Binny Bansal, who, according to the Economic Times, sold $104 million in shares but held on to a 4.2 percent stake. Walmart could increase its shareholding by an additional 10-12%.

The Arkansas-headquartered company will also have the final word on the appointment or removal of the top executives at Flipkart and its group companies, PhonePe and eKart. "There will be more balance of power if SoftBank is there in the company", he said, asking not to be named as Walmart is a client of his company.

When contacted, a SoftBank spokesperson declined to comment.

There has been much speculation over Flipkart's listing on the stock exchanges for years now.

"They have said they are taking a 20-year view on Flipkart".

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