The Department of Consumer Affairs, Government of India seeks views/ comments/ suggestions on the proposed amendments to Consumer Protection (E-Commerce) Rules, 2020 vide its communication reproduced below. It has sought views/suggestions by July 6, 2021 to [email protected].

Let us understand the proposed amendments.

Section 3 contains definitions for e-commerce entity, cross selling, fall back liability and flash sales.

My attention has been drawn towards the following information on flash sales.

“Flash sale” means a sale organized by an e-commerce entity at significantly reduced prices, high discounts or any other such promotions or attractive offers for a predetermined period of time on selective goods and services or otherwise with an intent to draw large number of consumers.”

However, flash sales are defined further as “Provided such sales are organized by fraudulently intercepting the ordinary course of business using technological means with an intent to enable only a specified seller or group of sellers managed by such entity to sell goods or services on its platform.”

It is not clear as to what is the meaning of fraudulently intercepting the ordinary course of business using technological means. We are all aware of any sale by amazon, Jio or any other web sites who advertise clearly well in advance, the terms are clear, and a large number of sellers with impeccable character participate. It is a routine chore in my house that a large number of items are always in and some others find the way to go out. I have never seen any seller to thrust any thing on me. The buyers have been exposed to the best items openly, most reasonably priced and goods taken back if the terms are clear about return of goods.

Kindly recall how many times I could return any thing in my younger days when the trader thought he did a favor to me by selling any time. The consumer rules came very late, more to satisfy the authorities with their attempt to serve the society though their intentions would not have been clear with the messages written in English drawn from British days.

Mis-selling on page 3 under 3(k) gets the following explanation.

“Mis-selling” means an e-commerce entity selling goods or services by deliberate misrepresentation of information by such entity about such goods or services as suitable for the user who is purchasing it”.

Expectedly, representation get amply explained as the positive assertion not required for selling, any display of wrong information, with an intent to deceive and further as causing, however innocently, a consumer to purchase such goods or services, to make a mistake as to the substance of the thing which is the subject of the purchase.

One often comes across Mis-selling as a major crime committed against a customer by insurance companies.

In this case, it may not be appropriate since I have an option to return the goods and no one is thrusting any product or services on me.

I vividly recollect purchasing a coffee filter for Rs 990 which on the first instant onwards failed to give any service or rather it was a pain on my hands and obviously on my mind which was wandering with wildest dreams with the coffee filter.

Would you believe that the seller refused to take back the product and also returned the money?

Let me ask the traders associations whether any Mis-selling ever took place in my younger days and the concept of return of goods ever happened even if I had been taken for a ride?

Under 4, the following information on registration of entities has been made compulsory. I am actually giving the full requirement from the text since many of you would become major sellers on web and revolutionize our buying experience.

From page 4 and again under (4) again——–

“4. Registration of e-commerce entities. — (1) Every e-commerce entity which intends to operate in India shall register itself with the Department for Promotion of Industry and Internal Trade (DPIIT) within such period as prescribed by DPIIT for allotment of a registration number. Provided that the DPIIT may extend the period for registration of such ecommerce entity for sufficient reason, to be recorded in writing.

 (2) Every e-commerce entity shall ensure that such registration number and invoice of everyday order is displayed prominently to its users in a clear and accessible manner on its platform.”

Currently, all entities which sell items invariably send receipt of money with full details of seller, address, and GST number. Either the web site or the seller gives telephone numbers if contacts need to be made.

Under (5) additional information of partnership and LLP have been added under entities character.

Again under 5(4(a)), an appointment of a Chief Compliance Officer who would ensure the entities to comply with terms of this act has been emphasized.

Yes, one recollects the din and noise made in case of Twitter which avoided appointment of a Chief Compliance Officer (CCO) which in Indian context is very essential since to whom shall I contact in case of my purchase and how to pursue in case of no-action by the seller?

I would like to know who is a CCO?

A clear definition has been given as under:

“Explanation. — For the purpose of this clause “Chief Compliance Officer” means managerial personnel or such other senior employee of an e-commerce entity who is a resident and citizen of India (b) appoint a nodal contact person for 24×7 coordination with law enforcement agencies and officers to ensure compliance to their orders or requisitions made in accordance with the provisions of law or rules made thereunder.”

Page 6 speaks of appointment of nodal contact person 24X7 and resident grievance officer, and details of Grievance redressal mechanism of e-commerce entity.

 Where an e-commerce entity offers imported goods or services for sale, it shall:- (a) mention the name and details of any importer from whom it has purchased such goods or services, or who may be a seller on its platform; further, the seller is expected to details of alternatives from India to offer equal opportunities to local sellers against foreign sellers.

How does one give a substitute to Olive oil which is not produced in India and a list of items which will fill the whole essay with the names only?

I would like to argue that the recent failure of our nation to produce a basic necessity like oxygen which was heavily imported from abroad has not shaken the conscience of the local producer.

We are aware that the more a nation imports, equal or more quantity of exports have been witnessed in trade all over the globe.

I feel this clause of ranking the firms is not clear and would undergo further refinement.

Page 7, items 11 and 12 explain the data to be incorporated in case of cross-selling.

Items 15, 16, 17, and 18 speak of no misuse of consumer information, no organization of flash sales, no misuse of dominant position in trade and providing information to any government agency the required information within 72 hours of receipt of information, order and enquiry. With the occurrence of cybercrimes, this has become an essential requirement of law of the land.

Page 9 item 5 speaks of equal treatment to all sellers by logistic service provider so that delivery of goods and services are not discriminated among sellers of goods through the e-commerce entity.

Page 10, item 6 contains the information that no market place e-commerce entity shall not use the information collected from its buyers/sellers for its related parties’ usage. Yes, you may notice a routine permission from any number of web pages innocently or meekly requesting you to use the information collected for that web page for any number of other related parties’ usage.

The following terms proposed are self- explanatory and need no observations from me.

“(7) No marketplace e-commerce entity shall sell goods or services to any person who is registered as seller on its platform;

 (8) No marketplace e-commerce entity shall advertise a body of sellers for the purpose of subsidizing a sale on its platform;

 (9) A marketplace e-commerce entity shall be subject to a fallback liability where a seller registered on its platform fails to deliver the goods or services ordered by a consumer due to negligent conduct, omission or commission of any act by such seller in fulfilling the duties and liabilities in the manner as prescribed by the marketplace e-commerce entity which causes loss to the consumer.”

Item number 8 invites inquisitive ears which whisper will all advertisements on a web site be banned? Can any expert on E- business explain?

What about duties of sellers on market place?

The only change proposed is that 7 (5) d which is reproduced below for information:

(5) Any seller offering goods or services through a marketplace e-commerce entity shall provide the following information to the e-commerce entity to be displayed on its platform or website:

“(d)all relevant details about the goods and services offered for sale by the seller including country of origin best before or use before date, information related to return, refund, exchange, expiration date, details of best before usage, warranty and guarantee, delivery and shipment, cost and return shipping, mode of payments, and any other similar information which are necessary for enabling the consumer to make an informed decision at the pre-purchase stage;”


The purpose of writing this article is to invite your attention to the keenest or minute changes being proposed to change Consumer Protection (E-Commerce) Rules, 2020, which stands notified on July 23, 2020 and was heavily criticized by many who felt that the local traders are not being offered equal opportunities for growth.

I totally disagree with the views of the trading community which is controlled by traditional traders whose grand fathers started the business, occupied the commercial places (even at Rs 1 at Chandni Chowk, Delhi) and jack up the price as and when the opportunity arises. Bankers blindly offered pledge loans or hypothecation loans fully secured by immovable properties. While the whole world has moved on, we buy beautiful items during our visits abroad. This attitude got changed by innovative youngsters fully supported by huge investments from foreigners who do not mind in believing in the bright future of India, the most promising developing nations.

Please read the original notification along with the proposed changes, apply your mind and do bother to write your suggestions/observations or comments to [email protected]


Disclaimer: The contents of this article are for information purposes only and do not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc. before acting on the basis of the above write up.  The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that Author/TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

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October 2021