Without Probe, How Can CCPA Decide Pressure Cookers Are Not BIS Compliant? Amazon Argues In Delhi High Court

The e-commerce giant Amazon on Monday questioned before Delhi High Court an order passed by Central Consumer Protection Authority (CCPA) imposing a penalty on it for allowing sale of domestic pressure cookers allegedly in violation to mandatory standards. How did the authority render a finding that the products were non compliant to Bureau of Indian Standards (BIS) when there was no investigation or enquiry regarding the same, asked Amazon.

Senior Advocate Rajiv Nayar appearing for the e-commerce platform argued before Justice Yashwant Varma that the proper procedure under Sec 20 of the Consumer Protection Act has not been followed in the case.

Section 20 states that where the CCPA is satisfied, on the basis of investigation, that there is sufficient evidence to show violation of consumer rights or unfair trade practice, it may pass an order for recalling of goods or withdrawal of services; reimbursement of the prices of goods or services and discontinuation of practices which are unfair and prejudicial to consumers' interest.

"There is a proper procedure how you can pass an order under Section 20. That is also not followed in this case. But another most important aspect is how have they arrived at the finding that the pressure cookers are not BIS compliant. If there is no investigation, no enquiry, how have you deduced from mere listings?," Nayar submitted.

He added "One of the manufacturers have written to us saying how have you taken us off the listing, we are BIS compliant."

On the other hand, the counsel appearing for CCPA on instructions told the Court that Amazon is an intermediary to bring the seller and buyer together.

"I have taken instructions. The learned senior had said basically that they are a mall. They are nothing like a mall. They are basically an intermediary to bring the seller and buyer together," the Counsel said.

Nayar told the Court that he will be advancing submissions in terms of Section 79(3) of the Information Technology Act, specifically on the aspect of its role as an intermediary.

However, Justice Varma orally told Nayar, "Section 79, I am indicating very openly, is not impressing us. That's our first impression. What we want, our anxiety is only this that under the 2020 e-commerce Rules that have been framed, show us the obligations placed on you and how you perform."

The Court will now hear the matter tomorrow as it was apprised about listing of a similar challenge preferred by Snapdeal.

The CCPA had initiate suo-moto action against e-commerce platforms for sale of domestic pressure cookers in violation to compulsory standards.

The authority had then issued notices to Amazon, Flipkart, Paytm Mall, Shopclues and Snapdeal as well as to the sellers registered on these platforms.

CCPA observed that total 2,265 pressure cookers, which were not conforming to mandatory standards, were sold through Amazon.

In the impugned order, CCPA had directed Amazon to notify all consumers of pressure cookers sold on its platform, recall the pressure cookers and reimburse their prices and also to submit a compliance report of the same.

Case Title: AMAZON SELLER SERVICES PVT LTD v. CENTRAL CONSUMER PROTECTION AUTHORITY