Case BriefsTribunals/Commissions/Regulatory Bodies

Competition Commission of India (CCI): The coram comprising of Ashok Kumar Gupta (Chairperson) and Sangeeta Verma, Bhagwant Singh Bishnoi, (Members) dismissed the complaint against Swiggy which accused it of unfair pricing.

Swiggy provides an online platform to the customers for ordering food from a wide range of neighbourhood partner restaurants listed on its platform.

The Swiggy app/ website page shows a whole list of restaurants to order from and once the restaurant is selected and order placed, the restaurant which has its own Swiggy application receives the order details and starts preparing the order.

Informants submit that, Swiggy typically charges a commission on the total order bill amount (which is inclusive of GST) from the partner restaurant. On the other hand, Swiggy charges delivery fee from the customer which generally ranges from Rs. 20- 100.

At times, Swiggy also charges more based on a surge in delivery prices in times of high demand, rains, special occasions and midnight delivery.

Allegations

Swiggy through its website/app charges higher than the rate offered by respective restaurants in their outlets over and above the delivery charges.

Informants submitted bills of restaurant and screenshot of Swiggy website to indicate the difference in prices of same dishes being ordered at the restaurant and from the Swiggy platform.

Unfair Price

Thus, in view of the above, informants have alleged that the OP is acting in contravention of Section 4(2)(a) of the Competition Act, 2002 by imposing unfair price.

Submissions by Swiggy

Swiggy submitted its response on the stated information in public and confidential version.

Swiggy added to its submissions that it only operates as an intermediary and the prices displayed on the platform are directly uploaded by the restaurants and the decision with regard to the prices solely depends on the restaurants.

Swiggy averred that as and when it receives complaints from buyers who find discrepancies between the prices listed on the Platform and the Partners’ menus, the same are escalated to the Partners for action as Swiggy cannot control, alter or affect the prices of items listed on its Platform.

With respect to dominance, Swiggy has claimed that it is not dominant in the relevant market and Zomato is its nearest competitor.

Decision

Commission notes that Swiggy has denied the allegations with reference to the contractual agreement it has entered into with its Partners (restaurants) seeking them to maintain a uniform price of food items sold by such Partners to customers when dealing with them directly or through the platform of Swiggy.

Thus, the above indicates that the allegations against Swiggy do not appear to be substantiated.

Hence, satisfied with the averments placed by Swiggy that it has no role to play in the pricing of the products offered by the restaurants on the platform, Commission finds no prima facie case of contravention of provisions of Section 4 of the Act. [Prachi Agarwal v. Swiggy, 2020 SCC OnLine CCI 22 , decided on 19-06-2020]

Case BriefsHigh Courts

Delhi High Court: The Bench of R.K. Gauba, J. quashed the summoning order passed by Metropolitan Magistrate against the CEO of Swiggy observing that it does not pass the muster of a judicial order.

The incident 

The incident occurred at Delhi-19, a restaurant in Kalkaji, Delhi. The company “Swiggy” is a food aggregator which collects food and beverages from restaurants as per customer’s orders through delivery personnel described as PDP (pick-up and delivery partners). On 14-7-2018, there was a rush of PDPs at Delhi-19 as there was some delay in service by the restaurant. The situation got out of hand inasmuch as the Fleet Manager of Swiggy had to intervene. It was alleged that later some of the PDPs returned and ransacked Delhi-19. In such course, violence erupted and one Kanav Madnani suffered injuries. An FIR was registered on statement of the proprietor of Delhi-19 and after the filing of first charge-sheet was filed against arrested persons. Subsequently, a supplementary charge-sheet was filed on the basis of which CEO of Swiggy (petitioner) was summoned to appear before the Metropolitan Magistrate.

The charge

In the supplementary charge-sheet, the CEO of Swiggy along with others was sought to be put on trial for the offence punishable under Section 109 read with Section 338 IPC. It was indicated that he was negligent in framing the policies with respect to the employment of delivery boys and failed to take preventive steps, thereby having intentionally aided by illegal omission, the commission of offence under the sections mentioned herein.

High Court’s decision

The High Court noted that the petitioner was stationed in Bangalore far away from the Delhi, the place of incident. The court was of the view that having regard to CEO’s role and responsibilities, the Magistrate was expected to subject the entire material presented before him to a closer scrutiny.  It was held that the summoning order did not pass the muster of a judicial order. There was no consideration of background facts or the connection between the offence and role of the CEO. In such circumstances, the summoning order was quashed and the matter was remitted back to MM for fresh consideration.[Sriharsha Majety v. State (NCT of Delhi), 2019 SCC OnLine Del 6730, dated 25-01-2019]