What is Liability of E-commerce Company? SC Issues Notice in Cheating case


July 24, 2018

Case name: Dinesh Agrawal v. The State of Bihar


The risks and threats posed by the burgeoning E-commerce sector has been a contentious and intriguing issue in the recent past. Though E-commerce sector has lot to offer in terms of comfort and endless variety, a steep rise has been witnessed in consumer complaints lodged against E-commerce companies.

To know more about Liability of E-commerce Companies and Risks of Online Shopping read E-commerce Fraud in India- Risk, Measures and Legal Implications.

In this case, recently taken up by the Supreme Court, the Petitioner, Managing Director of India Mart has approached the Apex Court to quash criminal complaint lodged against the website, wherein the website has been accused of the offence of cheating.

The Supreme Court has now issued notice in the matter and directed that no coercive steps shall be taken against the Petitioner in connection with the FIR.

In the FIR, the complainant has alleged that he registered with India Mart and connected with a seller who promised to sell him a speaking parrot. However, the complainant did not receive the speaking parrot as promised by the seller. The Petitioner in the case contended that he was working as Managing Director of the firm which maintains the website and that the website has only provided a platform and that the petitioner has no control on that. Thus, the Petitioner in the case has took defence under Section 79 of the Information Technology Act which exempts intermediaries from liability in certain cases.

The Apex Court’s decision in the case may aid in streamlining the issues associated with intermediary liability of E-commerce companies in India.

The Supreme Court’s order in the case can be accessed here.