Amazon sues CCPA over Rs1 lakh penalty for faulty cookers

10 Oct 2022 , 01:28 PM

Amazon has filed a lawsuit in the Delhi High Court against the Central Consumer Protection Authority (CCPA), contesting a finding that the e-commerce site had broken laws pertaining to the selling of pressure cookers.

The local branch of the Seattle-based e-commerce company was fined Rs1 lakh by the regulatory body under the Ministry of Consumer Affairs, Food, and Public Distribution in August for violating Bureau of Indian Norms (BIS) standards for goods sold on its platform.

It’s possible that this is the first time Amazon has litigated against a regulatory agency. It had petitioned the Delhi High Court in the latter part of last year to request help from the Enforcement Directorate (ED) over an investigation into its investment in a Future Group firm.

The marketplace division of Amazon India, Amazon Seller Services, took CCPA to Delhi High Court last month, although the case has not yet been reported.

Amazon claims that neither it was informed of the details of any CCPA investigation nor was it given the opportunity to refute the charges in its request for an interim injunction from the court.

The e-commerce company further stated that it was not provided with the report upon which the CCPA based its penalty assessment of it and that the imposition of such a penalty under Section 20 of the Consumer Protection Act, 2019, is unlawful.

Online marketplaces typically assert that, although having a specific method in place to verify the information listed by sellers, it is ultimately the merchants’ responsibility to sell their products on e-commerce platforms.

In its August order, the CCPA stated that Amazon had acknowledged receiving a “sales commission” fee for the pressure cookers sold on its platform. The CCPA further stated that because Amazon benefits financially from each sale of a product listed on its e-commerce platform, it is unable to disassociate itself from any problems that may arise as a result of such sales.

Similar fines for defective pressure cookers were also imposed on Paytm Mall, however, the online retailer followed CCPA instructions and submitted the fine money.

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