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Consumer Forum: E-Commerce Platform Responsible for Seller Failing to Display ‘Country of Origin’ of Product

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DCDRC Law Insider

Khushi Bajpai

Published on: October 3, 2022 at 22:04 IST

A consumer forum has held and e-commerce platform responsible for the seller failing to display the “country of origin” of the product, in what may be a first of its kind ruling.

According to the Consumer Protection (E-Commerce Rule 2020), the seller must disclose the product’s country of origin, and the online marketplace must make sure that all necessary information is displayed so that the customer can make an educated decision, according to the District Consumer Disputes Redressal Commission of Hyderabad.

The safe harbor immunity provided for intermediaries under Section 79 of the IT Act cannot be invoked by the online marketplace if there is any infringement of the E-commerce rules.

In order to compensate, Advocate Baglekar Akash Kumar, the plaintiff in the case, the consumer forum held Paytm (the online marketplace) and Uni One India Pvt Ltd. (the vendor) accountable for a lack of service and ordered them to pay Rs. 15,000.

The Usha sewing machine that Akash Kumar paid Rs. 13,440 for through Paytm in August 2020 was the subject of the complaint.

The complaints learned that the machine was manufactured in Thailand when the item was delivered.

As required by Rule 6(5)(d) of the Consumer Protection (E-Commerce) Regulations, 2020, the manufacturer failed to disclose the country of origin on the website. The complaint presumed that the goods were created in India because no information was provided.

He claimed that if the nation of origin had been disclosed on the internet portal, he would not have bought the sewing machine.

E-Commerce Company Accountable for Seller’s Careless Actions

By stating that there has been a “paradigm shift in the liability of online traders, who until recently mostly functioned in the character of middlemen,” the Consumer Forum dismissed Paytm’s arguments.

With the implementation of the E-commerce Rules, online merchants will be held directly and indirectly liable for any harm the vendor causes to the client.

This indicates that the onus of liability shall lay with the E-commerce entity even in circumstances of negligent behavior by the seller, if the forum stated that the final consumers bear the risk of any damages.

The order went on to state:

“Consumer purchasing habits in India have seen a considerable transformation as a result of the growing popularity of e-commerce platforms. Consumers generally rely on the details offered by businesses in their product advertisements when making purchasing decisions.”

“However, this competition for supremacy has increased the use of false claims, information hiding, and misrepresentation. In the given case, the act of not declaring the nation of origin on the product is nothing but the breach of the relevant E-commerce rules”.

The Commission comprising Mrs. Uma Venkata Subba Lakshmi (President), Mrs. C Lakhsmi Prasanna (Member) and Mrs. Madhavi Sasanakota (Member) thus directed to comply with the Consumer Protection (E-Commerce) Rules, 2020 in letter and spirit and issue corrective product information that came to question in the instant complaint.

The Commission also directed the opposite parties to pay compensation of Rs. 15,000 for deficiency of service and adoption of unfair trade practice.