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District Consumer Disputes Redressal Commission (DCDRC), Gondia: In the instant ‘unique’ complaint, relief in the nature of directions to Facebook were sought vis-a-vis discontinuation of unfair/ restrictive trade practices; not putting up misleading advertisements and neutralization of the effect of misleading advertisements on their platform. The coram of Bhaskar B. Yogi (President) and Sarita B. Raipure (Member) directed Facebook and Meta Inc. to run scam related awareness advertisement on various media, social sites, TV and OTT platforms to create awareness regarding various scam on regular basis to neutralize the impact of misleading advertisements. The Commission also stated that Facebook has a legal and social duty and obligation to provide funding to a step-by-step service to aid and advise the public regarding online frauds and scams.

Facts of the case: The complainant who hails from Maharashtra, is a daily wager coming from Below Poverty Line Family and currently remains unemployed due to Covid19 pandemic. Facebook (opposite party) is a major social networking site.

The complainant is an active Facebook user. On 16-09-2020, the complainant noticed on his Facebook-wall an advertisement of Marya Studio, offering shoes of Nike Company for Rs. 599. As the advertisement was on Facebook, the complainant did not doubt its authenticity and immediately placed the order for shoes and paid Rs. 599 through his debit card. The Complainant waited for a long time but he did not receive any text or call from the Marya Studio regarding shipping of the shoes booked by him, and since Facebook did not contain any contact details of Marya Studio, therefore the complainant googled Marya Studio’s customer care number and in result he came to the website which showed 4-5 numbers of Marya Studio Customer Care. The Complainant called on one of the numbers and the person receiving the call introduced themselves as Marya Studio’s Customer Care Executive. The person sent a link to the Complainant and asked him to fill debit card details in that link for the purposes of refund. The Complainant was further asked to download AnyDesk App in order to receive the refund amount. The Complainant did as he was instructed and also the provided the OTP number as required by the Customer Care Executive. However, the complainant was duped for Rs. 7568.

Thereafter the complainant tried to bring this fraud to the notice of Facebook (via Twitter and then e-mail) and sought compensation of Rs. 7568, but Facebook never replied. Therefore the complainant was compelled to knock the doors of the District Commission, Gondia, against Facebook.

Contentions: The counsels of the complainant put forth the following contentions-

  • It was argued that Facebook voluntarily and intentionally runs a false, frivolous, misleading and fraudulent advertisement and causes loss to the public at large. The complainant pointed out the names of the many fake pages advertised on Facebook like- Marya Studio, Yaryastudio, Crunchkart, G9fashionnn etc. The complainant also cited the names of other persons who were victims of such fake advertisements.
  • It was argued that the complainant is unemployed has suffered a lot due to the loss of the afore-stated amount. It was stated that he has no money to buy groceries and vegetables and that him and his family members are suffering from starvation. Such circumstances have caused a great deal of mental and physical pain to the Complainant and his family.

Per-contra, the opposite parties (Facebook/ Meta) argued on the following points-

  • It was contended that Complaint is not maintainable since the Complainant is not a ‘consumer‘ of Facebook India.
  • It was submitted that Facebook India is a wrong entity for adjudicating this Complaint since it does not operate/control the Facebook service- as Facebook would be considered as an intermediary, and therefore, immune from liability under the provisions of the Information Technology Act, 2000. Furthermore Facebook would be under no obligation to proactively monitor the Facebook Service under the IT Act and as per the decision of the Supreme Court in Shreya Singhal v. Union of India, (2015) 5 SCC 1.
  • Meta submitted that it has taken reasonable steps to enforce policies to protect its users and offers several user friendly tools to enable users to report violations of these policies.

Observations: Based on the facts and contentions presented in the case, the Commission framed certain important issues and made the following observations-

  • The Commission pointed out that to establish the consumer-service provider relationship, the complainant has to prove whether he has paid any consideration for service while buying online product from third party. Perusing the details provided by the complainant, the Commission observed that complainant paid Rs 599 for purchase of the shoe, whose advertisement was hosted on Facebook. The revenue of opposite parties mainly comes by selling the space for advertising which is clear from their Memorandum of Association. The Commission thus noted that the complainant falls under the category of ‘consumer’.
  • The Commission noted that the complainant suffered from financial loss due to misleading advertisement. However, the Commission deliberated on the extent to which the opposite party was bound to compensate. The Commission perused the “Help Centre” details provided on Facebook titled “Privacy, safety and security- Shopping safety”. It was noted that transaction of buying shoes Rs. 599 was due to a misleading advertisement; but, the second transaction of sharing OTP and personal bank details by the complainant was due to his own unawareness regarding online scams, therefore can be termed as ‘contributory negligence’ for which the opposite parties are not liable.
  • It was observed that the Government of India has taken various measure to curb the menace of online fraud from time to time by inserting concerned provisions in the Consumer Protection Act and Consumer Protection (E-commerce) Rules, 2020. It was noted that the law provides a clear mandate of compliance for social media websites. The Commission pointed out that complainant was lured to purchase the product by looking to the rate of the shoes, and it is mandatory obligations of e-commerce websites to provide complete name, address, contact numbers, email address of the seller so that in case of any consumer grievance it can be redressed immediately. The e-commerce websites, as prescribed by RBI have a Corporate Social Responsibility to educate the masses regarding various online frauds. It was stated that opposite parties failed to sufficiently safeguard and protect the Indian consumers from unscrupulous exploitation.

Decision/Directions: Perusing the facts and contentions presented by the parties and making the afore-stated observations, the Commission partly allowed the complaint and made the following directions-

  • The opposite parties are to pay to the complainant the price of product (Nike shoes) not delivered i.e. Rs. 599. The opposite parties were directed to pay Rs. 25,000 for mental agony and legal costs suffered by the complainant.
  • Facebook/ Meta directed to comply the Consumer Protection (e-commerce) Rules, 2020 in letter and spirit and submit report of compliance within a period of 45 days to this Commission.
  • Facebook was directed to issue corrective advertisement in order to neutralize the effect of misleading advertisement that came to question in the instant complaint.

[Tribhuvan v. Facebook India Online Services Pvt. Ltd., Complaint No. : CC/117/2020, decided on 30-06-2022]

Advocates who appeared in this case :

Sagar J. Chavhan, Advocate, for the Complainant;

M. B. Ramteke, Advocate, for Opposite Parties.

*Sucheta Sarkar, Editorial Assistant has prepared this brief

Case BriefsSupreme Court

Supreme Court: The bench of Dr. DY Chandrachud and MR Shah, JJ has held that consumer fora has no jurisdiction and/or power to accept the written statement beyond the period of 45 days.

The Court was hearing the case where the National Consumer Disputes Redressal Commission had confirmed the order passed by the Karnataka State Consumer Disputes Redressal Commission rejecting the application seeking condonation of delay in filing the written statement to the consumer complaint. The written version/written statement was filed beyond the prescribed period of limitation provided under the Consumer Protection Act, 1986, i.e., beyond the period of 45 days.

As per the Consumer Protection Act, 1986, the written version/written statement is required to be filed within 30 days and the same can be extended by a further period of 15 days.

As per the decision of the Constitution Bench in New India Assurance company Limited v. Hilli Multipurpose Cold Storage Private Limited, (2020) 5 SCC 757,

“the District Forum has no power to extend the time to file the response to the complaint beyond the period of 15 days in addition to 30 days as is envisaged under Section 13 of the Act.”

It was, however, submitted by the petitioner that as observed in paragraph 63, the said judgment shall be applicable prospectively only. Therefore, the aforesaid decision shall not be applicable retrospectively to the complaints filed before the said decision.

Refusing the accept the contention, the Court said that as per the decision in J.J. Merchant v. Shrinath Chaturvedi, (2002) 6 SCC 635, which was a three Judge Bench decision, consumer fora has no power to extend the time for filing a reply/written statement beyond the period prescribed under the Act. However, thereafter, despite the above three Judge Bench decision, a contrary view was taken by a two Judge Bench and therefore the matter was referred to the five Judge Bench and the Constitution Bench has reiterated the view taken in the case of J.J.Merchant and has again reiterated that the consumer fora has no power and/or jurisdiction to accept the written statement beyond the statutory period prescribed under the Act, i.e., 45 days in all.

The petitioner had then relied on Reliance General Insurance Co. Ltd. v.  Mampee Timbers & Hardwares Pvt. Ltd., 2017 SCC OnLine SC 2027, wherein it was directed that the consumer fora may accept the written statement beyond the stipulated time of 45 days in an appropriate case, on suitable terms, including the payment of costs and to proceed with the matter, keeping in view the fact that the judgment of this Court in the case of New India Assurance Company Limited v. Hilli Multipurpose Cold Storage Private Limited, (2015) 16 SCC 20 has been referred to a larger Bench.

The Court rejected this contention too on the ground that the Court had, in Reliance General Insurance Co. Ltd, specifically mentioned that

“it will be open to the concerned fora to accept the written statement filed beyond the stipulated period of 45 days in an appropriate case, on suitable terms, including the payment of costs and to proceed with the matter.”

Therefore, ultimately, it was left to the concerned fora to accept the written statement beyond the stipulated period of 45 days in an appropriate case.

In the present case, despite sufficient time granted the written statement was not filed within the prescribed period of limitation. Therefore, the Court observed that the National Commission had considered the aspect of condonation of delay on merits also.

[Daddy’s Builders Pvt. Ltd. v. Manisha Bhargava, 2021 SCC OnLine SC 82, decided on 11.02.2021]

*Judgment by: Justice MR Shah

Petitioner’s Counsel: Advocate Ashish Choudhary


District Forum can’t extend limitation period of 45 days for filing response under Section 13 of Consumer Protection Act

National Consumer Disputes Redressal Commission
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National Consumer Disputes Redressal Commission (NCDRC): A Division Bench of R.K. Agrawal (President) and Dr S.M. Kantikar (Member), held that

“…for detrmining the pecuniary jurisdiction of the District Commission, State Commission or National Commission the value of goods or services paid as consideration alone has to be taken and not the value of the goods or services purchased.”

Complainant approached the Commission with regard to a complaint against National Insurance Company Limited, Kolkata.

Further, it was stated that the complainant had taken Insurance coverage from National Insurance Company Limited, Kolkata under its Standard Fire and Special Perils Policy initially for a total sum of Rupees Twenty eight crores and twenty thousand only by paying a premium of Rupees Three lac twenty thousand five hundred and twenty-five only.

An additional security coverage of Rupees Thirteen crores only on 25-08-2020 by paying a premium of Rupees One lac twenty-three thousand and thirty-seven only.

Due to heavy rainfall and flood water, factory premises of the Complainant got tilted and partial collapse of the building was caused with several other losses due to damage in the building.

Complainant informed the National Insurance Company Limited, Kolkata on 05-09-2020 about the loss sufferred and making the payment of the loss suffered by estimating it.

After exchange of correspondence and personal interaction the National Insurance Company Limited – OP-1 repudiated the claim of the Complainant.

Maintainability of the present complaint

In the present case a preliminary point arises as to how this Consumer Complaint is maintainable before the National Consumer Disputes Redressal Commission because the value of the consideration paid in the present case i.e. premium paid for taking the Insurance Policies was only Rs 3,20,525 and Rs 1,23,037 the total of which comes to Rs 4,43,562 (Rupees Four Lac forty three thousand five hundred and sixty two only), which is less than the consideration paid of more than Rs 10,00,00,000 (Rupees Ten crores) as provided under Section 58 (1) (a) (i) of the Act of 2019.

Parliament, while enacting the Act of 2019 was conscious of this fact and to ensure that Consumer should approach the appropriate Consumer Disputes Redressal Commission whether it is District, State or National only the value of the consideration paid should be taken into consideration while determining the pecuniary jurisdiction and not value of the goods or services and compensation, and that is why a specific provision has been made in Sections 34 (1), 47 (1) (a) (i) and 58 (1) (a) (i) providing for the pecuniary jurisdiction of the District Consumer Disputes Redressal Commission, State Consumer Disputes Redressal Commission and the National Commission respectively.

Hence, the bench stated that Sections 34 (1), 47 (1) (a) (i) and 58 (1) (a) (i) of the Act of 2019 make it clear that for detrmining the pecuniary jurisdiction of the District Commission, State Commission or National Commission the value of goods or services paid as consideration alone has to be taken and not the value of the goods or services purchased.

Therefore, we are of the view that the provision of Section 58 (1)(a)(i) of the Act 2019 are very clear and does not call for any two interpretations.

As the value of consideration paid by the Complainant is only Rs 4,43,562 (Rupees four lac forty three thousand five hundred and sixty two only), which is not above Rs 10,00,00,000 (Rupees Ten crore), the National Commission has no jurisdiction to entertain the present Consumer Complaint. [Pyaridevi Chabiraj Steels (P) Ltd. v. National Insurance Company Ltd., Consumer Case No. 833 of 2020, decided on 28-08-2020]

National Consumer Disputes Redressal Commission
Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission (NCDRC): The Bench of Justice V.K. Jain (Presiding Member) while deciding the issues revolving around purchase of a residential flat, rejected the instant appeal preferred by Magnolia Infrastructure, after being aggrieved by the Order passed by the State Commission to hand over the constructed property to the complainants.

The complainants entered into a MoU with the appellant, for the purchase of a residential flat for a consideration of Rs 40,26,200 by paying an initial amount of Rs 12,45,183. According to the agreement, the area of the flat had to be 1114 sq. feet and the possession was to be handed over by June 2015, with a grace period of six months available to the builder. However, the size of the flat was contested to be smaller than the agreed size by the complainant. The complainant further stated that and the construction of the flat was incomplete, therefore, the complainant went to the State Commission, who found these contestations to be genuine and legible and ordered the builders to pay the compensation for the alleged violation of the agreement. The appellants (builders) were represented by Sanjoy Kumar Ghosh and Barun Prasad, while the respondent (complainant) appeared for himself before the Commission. The counsel for the appellant challenged the State Commission’s Order by contesting the area of the flat to be of the agreed size and the certificate/completion certificate of the flat allotted to the complainant.

Commission decided that the area measurement conducted by the person appointed by the State Commission was correct and that there was actual shortage in the area of the flat as the constructed flat’s size was found to be 997 sq. feet. For the second issue, the Commission observed that the flat was already constructed and lying vacant thereby serving no purpose.

Since, the State Commission is yet to verify that whether Rajarhat Municipal Corporation is competent to issue the occupancy certificate and whether had actually issued the said occupancy certificate dated 21-07-2014, the Commission held that the possession of the residential flat should be handed over to the complainant till this question is decided by the State Commission. [Mangolia Infrastructure Development Ltd. v. Sandipan Santra, FA No. 2084 of 2018, decided on 14-07-2020]

National Consumer Disputes Redressal Commission
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National Consumer Disputes Redressal Commission (NCDRC): A Coram of Justice R.K. Agrawal (President) and Dinesh Singh (Member), disposed of a case centered around a car and its defects. and due to its longevity, the car was not so feasible, at this stage in time, to remand back to the District Forum for decision afresh on the (principal) question of ‘defect’ in manufacture as 14 years has passed since it was first brought in the District Forum and now it cannot be put to test before an ‘appropriate laboratory’, to determine that ‘defect’ as laid down in the provisions of the ‘The Consumer Protection Act, 1986’.

In this case, the appellant had filed a case in the District Forum, Yamunanagar in 2005, for manufacturing defects in a car. The District Forum allowed the complaint and also issued directions to replace the car or refund the amount of the car with interest to the aggrieved party, When the appeal went on to the State Commission it allowed the petition and ordered the company to remove the defects “if any”. 

The NCDRC with regard to the decision said that the District Forum should have first decided if the purchaser i.e. the Revisionist Petitioner was a “complainant” in terms of Section 2(1)(d) of ‘The Consumer Protection Act, 1986’ or not. Also, the National Commission made a remark that the District Forum should have referred the goods to the appropriate laboratory under Section 2 (1) (a) of the Act for the determination of defects.

The National Commission in its judgment remarking about the State Commission said that though it rightly concluded that ‘defect’ in manufacture cannot be made out now, but it erred in not remanding the case back to the District Forum for decision afresh, to decide the question of ‘defect’ in manufacture after duly adopting the procedure prescribed in Sections 13(1)(c) to (g) of the Act and also it termed the order of the State Commission as “unreasoned”, “suffering from incongruity” and “inner-inconsistency”.

The National Commission remarked that the correct thing would have been to direct the case back to the District Forum for fresh consideration. However, given that the case had already taken 14 years, it held that doing the same would be “inequitable and result in some miscarriage of justice” to the Petitioner. 

The Tribunal also noted that the Statement of Objects and Reasons of the Act speaks of “speedy and simple redressal to consumer disputes” and also the Act is for “better protection of the interests of consumers so a Complainant cannot be put to prejudice for faults in adjudication by Consumer Protection Fora. 

However, having said that they also noted, that on presenting its Complaint alleging “manufacturing defects” and no steps were taken by the Complainant for adopting the procedure that is prescribed in Sections 13(1)(c) to (g) before the District Forum. The Commission concluded by saying that it should not be attended as a precedent. [Gopal Aggarwal v. Metro Motors, 2019 SCC OnLine NCDRC 754, decided on 17-12-2019]

Hot Off The PressNews

The following information regarding Online Fraud Cases was provided by Minister of State for Consumer Affairs, Food & Public Distribution, Shri Danve Raosaheb Dadarao in the Lok Sabha today, i.e. 09-07-2019.

Under the Consumer Protection Act, 1986, a three-tier quasi-judicial mechanism has been set up at District, State and Central levels for better protection of the interests of consumers and to provide simple and speedy redressal of consumer disputes including online frauds. The consumer fora are empowered to give relief of a specific nature and award, wherever appropriate, compensation to consumers. Besides, the Department of Consumer Affairs is also running a National Consumer Helpline (NCH) where a consumer can call to seek information, advice or guidance and file complaints.

The number of complaints regarding online shopping after operationalization of online complaint filing from August, 2016 to March, 2019 in the National Consumer Helpline is 8373.

The complaints received in the NCH are forwarded to the companies concerned for redressal. During the period December, 2016 and March, 2019, in 913 such cases the complainants have been advised by the NCH to approach the local police.

Press Release dt. 09-07-2019

[Source: PIB]