Inox, Paytm Under Police Scanner For Internet Handling Fees, Inox Blames Paytm ?

Inox is charging illegal fees from users?
Inox is charging illegal fees from users?

Leading multiplex chain Inox and India’s biggest mobile wallet Paytm, both are under police investigation for charging ‘Internet Handling Fees’ from consumers.

The complaint has been filed by an activist of consumer rights in Hyderabad, and investigations are currently on.

Interestingly, Inox has blamed Paytm for charging this unauthorized fees.

How will Paytm react now? Wil other ticketing apps and multiplexes stop charging these fees from consumers?

Police Investigate Against Inox, Paytm

Based on the complaint filed by Vijay Gopal, Hyderabad police has started investigating a case against Inox and Paytm for charging illegal internet handling fees.

This has been confirmed by the Hyderabad police.

Avinash Mohanty, Deputy Commissioner of Police (DD) Avinash Mohanty said, “The Central Crime Station (CCS) of the Hyderabad police have initiated a preliminary inquiry and will take legal counsel before taking any action,”

As per case filed by Vijay Gopal, when he booked two movie tickets whose original cost was Rs 138 per ticket, he ended up paying Rs 566.12, which is Rs 80.12 extra.

Out of this extra Rs 80.12, he paid a convenience fee of Rs 12, a booking charge of Rs 22 and cancellation protection fees of Rs 33.90.

The case has been filed for this convenience fee of Rs 12, and booking a charge of Rs 22, as the cancellation protection fee is an optional fee which can be unchecked by the consumer.

Internet Handling Fees Is Illegal?

Vijay Gopal, who has filed this case, had earlier filed a similar consumer protection case against BookMyShow and PVR, for charging this same internet handling fees, booking fees and service charges.

The complaint highlights 6A (3) section of the IT Act, based on which no internet company is authorized to charge such fees from the consumer.

Vijay Gopal had earlier filed an RTI with the Reserve Bank of India, and had received the same reply: No ecommerce or internet-based company can charge any additional fees from the consumer such as Internet handling fees, service fees and convenience fees.

As per the Consumer Affairs Ministry’s rules, no business can charge any money other than the MRP of the product, be it online or offline.

Inox Blames Paytm

After this complaint was filed, Inox has responded by saying that it is Paytm which is charging this additional internet handling fees/convenience fees, and they have no role in that.

A spokesperson from Inox said, “It’s up to them to respond. We are in no way connected to this complaint by Vijay Gopal,”

Interestingly, other online based apps/services such as food delivery apps and ecommerce portals also charge these fees from the users. In case the Consumer Court delivers a verdict against Inox and Paytm, then this may have long term implications.

We will keep you updated, as we receive more updates.

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