Ecommerce websites are legally liable for service defects: Indian Law
E-commerce shopping websites liable for deficient service
When a problem arises, the portal shuns responsibility by claiming it is only a trading platform to bring the buyer and the seller together, and is in no way liable.
Online shopping is becoming increasingly popular because it saves time, the bother of travelling, the prices are competitive, and returns are accepted. In some cases, the seller's name is disclosed, but the address and contact numbers are withheld. This is done in business interests, so that the buyer and seller do not make a deal, depriving the portal of its commission.
The consumer deals with the portal, makes payment to the portal and follow-ups too are via emails to the portal. Yet, when a problem arises, the portal shuns responsibility by claiming it is only a trading platform to bring the buyer and the seller together, and is in no way liable. This is against consumer interest and unwarranted, as held by various consumer fora.
Case Study 1:
Atul Malhotra ordered a Lava mobile phone offered at a 94% discount on Flipkart, for an amount of Rs 400. Flipkart cancelled the order two days later, claiming inability to cope with the demand, refunding Rs 400. Since Atul wanted the phone, not the refund, he complained to the Chandigarh District Forum. Flipkart claimed it was not liable, and the complaint be dismissed as the actual seller had not been joined as a party to the dispute.
The forum observed that Flipkart had made the offer. The entire email correspondence was with Flipkart, including the cancellation. Hence, it would be liable for deficient service. Flipkart was ordered to pay Rs 3,000 as compensation and Rs 2,500 towards costs.
Case Study 2:
Shivanand Narain had purchased a Stealth mobile phone online for Rs 20,390, which turned out to be defective. He returned it and sought a replacement, as the website promised. Since his grievance was not redressed, he filed a complaint. The forum ordered the portal to refund Rs 20,390, the price of the mobile and also awarded Rs 15,000 as compensation.
The portal challenged the order in an appeal to the Chandigarh state commission, contending it was only a "facilitator". Rejecting this argument, the commission observed that the portal solicits business. Customers make payments to the portal. Correspondence with the portal is through the given email address. Thus, it actively participates in the transactions. The state commission dismissed the portal's appeal.
Case Study 3:
Urmil Munjal had made an online purchase through rediff.com. As she was not satisfied with the product supplied, she filed a complaint against the portal before the Gurgaon district forum, which allowed the complaint. The portal's appeal was dismissed. It filed a revision before the national commission, contending that it was only a facilitator.
Rejecting this argument, the national commission observed that the portal had admitted it acts as an intermediary, collecting payment. So its services could not be considered gratuitous merely because no separate charge was collected from the consumer. Inviting buyers and sellers to trade online made the portal amenable under the Consumer Protection Act. The commission concluded that the e-commerce portal would be liable to the consumer.
Conclusion:
E-commerce platforms are liable for the products advertised and business solicited through their websites.
When a problem arises, the portal shuns responsibility by claiming it is only a trading platform to bring the buyer and the seller together, and is in no way liable.
Online shopping is becoming increasingly popular because it saves time, the bother of travelling, the prices are competitive, and returns are accepted. In some cases, the seller's name is disclosed, but the address and contact numbers are withheld. This is done in business interests, so that the buyer and seller do not make a deal, depriving the portal of its commission.
The consumer deals with the portal, makes payment to the portal and follow-ups too are via emails to the portal. Yet, when a problem arises, the portal shuns responsibility by claiming it is only a trading platform to bring the buyer and the seller together, and is in no way liable. This is against consumer interest and unwarranted, as held by various consumer fora.
Case Study 1:
Atul Malhotra ordered a Lava mobile phone offered at a 94% discount on Flipkart, for an amount of Rs 400. Flipkart cancelled the order two days later, claiming inability to cope with the demand, refunding Rs 400. Since Atul wanted the phone, not the refund, he complained to the Chandigarh District Forum. Flipkart claimed it was not liable, and the complaint be dismissed as the actual seller had not been joined as a party to the dispute.
The forum observed that Flipkart had made the offer. The entire email correspondence was with Flipkart, including the cancellation. Hence, it would be liable for deficient service. Flipkart was ordered to pay Rs 3,000 as compensation and Rs 2,500 towards costs.
Case Study 2:
Shivanand Narain had purchased a Stealth mobile phone online for Rs 20,390, which turned out to be defective. He returned it and sought a replacement, as the website promised. Since his grievance was not redressed, he filed a complaint. The forum ordered the portal to refund Rs 20,390, the price of the mobile and also awarded Rs 15,000 as compensation.
The portal challenged the order in an appeal to the Chandigarh state commission, contending it was only a "facilitator". Rejecting this argument, the commission observed that the portal solicits business. Customers make payments to the portal. Correspondence with the portal is through the given email address. Thus, it actively participates in the transactions. The state commission dismissed the portal's appeal.
Case Study 3:
Urmil Munjal had made an online purchase through rediff.com. As she was not satisfied with the product supplied, she filed a complaint against the portal before the Gurgaon district forum, which allowed the complaint. The portal's appeal was dismissed. It filed a revision before the national commission, contending that it was only a facilitator.
Rejecting this argument, the national commission observed that the portal had admitted it acts as an intermediary, collecting payment. So its services could not be considered gratuitous merely because no separate charge was collected from the consumer. Inviting buyers and sellers to trade online made the portal amenable under the Consumer Protection Act. The commission concluded that the e-commerce portal would be liable to the consumer.
Conclusion:
E-commerce platforms are liable for the products advertised and business solicited through their websites.
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