Paytm Mall, Snapdeal Sold Defective Pressure Cookers; Rs 1 Lakh Penalty Imposed By Consumer Protection Authority

A fine of Rs 1 lakh each on e-commerce firms Paytm Mall and Snapdeal is imposed by the Central Consumer Protection Authority (CCPA).

How Did This Happen?

The above discussed fine was imposed for selling non-standard pressure cookers.

CCPA further asked them to recall the sold items as well as reimburse the amount paid by the consumers.

The CCPA found Paytm Ecommerce Pvt Ltd (Paytm Mall) and Snapdeal Pvt Ltd guilty of selling pressure cookers in two separate orders.

These pressure cookers did not conform to BIS standards and were non-compliant to Domestic Pressure cooker (Quality Control) Order 2020 (QCO).

CCPA found that Paytm Mall listed pressure cookers of Pristine and Quba on its platform despite the product description clearly stating that it does not carry ISI mark.

So, the CCPA has ordered Paytm Mall to notify all consumers of the 39 pressure cookers sold on its platform to recall the pressure cookers and reimburse their price to the consumers, in its order dated March 25. 

Compliance Report In 45 Days

To confirm the execution, these online platforms have been asked to submit a compliance report of the same within 45 days.

In case of Snapdeal, it has listed pressure cookers of Saransh Enterprises and AZ Sellers on its platform that were non-compliant to the norms.

So, CCPA issued a similar order in case of Snapdeal asking the e-tailer to recall 73 pressure cookers sold on its platform and reimburse the amount to consumers.

Further, the authority has asked both the e-commerce companies to “pay a penalty of Rs 1 lakh for allowing sale of pressure cookers in violation to the QCO on its platform and violating rights of consumers” in separate orders.

Online Platforms Ready To Appeal Further 

In their defense, both the companies have argued that they are intermediaries as per IT Act and the responsibility of content lies with the seller and not on them.

But, CCPA cited consumer protection (e-commerce) rules, 2020.

According to this, no e-commerce entity shall adopt any unfair trade practice whether in the course of business or its platform or otherwise.

On this subject, Snapdeal said, “This order is against the principle of safe harbor and exemption from liability in certain cases as enshrined under section 79 of Information Technology Act,” in a statement.

It seems that the CCPA has stepped beyond the scope of BIS Act, COPRA and the Consumer Protection (E-Commerce) Rules 2020.

These rules clearly distinguish between the liabilities of a marketplace and the seller of a product on the marketplace. 

Further, online platforms will seek an appeal as it is important to set the correct precedent in accordance with applicable law, which has been upheld by multiple High Courts and the National Consumer Commission.

Further adding, “However, the interests of the consumers are paramount. While we challenge the order of the CCPA, we will offer a BIS-certified pressure cooker as an immediate replacement to all the customers of the identified sellers, which includes the 73 customers identified in the order. In line with our confirmation to CCPA, the listings of the three sellers have been removed and the sellers have been permanently blocked from the platform.”