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Govt should ensure social commerce companies show country of origin of goods: Plea in Delhi HC

E-commerce

The government should ensure that social commerce companies such as Meesho, GlowRoad, and Shop101, display products’ country of origin, seller details, maximum retail price of commodities, and the name of manufacturers, a plea in the Delhi High Court has prayed. MediaNama has seen a copy of the petition.

The petition, filed by one Ajay Kumar Singh, alleged that these social commerce websites were knowingly violating rules which require them to disclose seller information along with country of origin, “only with motive to promote illegal sale and make huge money out of it”. It argued that not disclosing this information robs consumers of their rights. Meesho, one of the platforms listed as a respondent in the petition has received investment from Facebook.

The Consumer Protection (E-Commerce) Rules, 2020, notified by the Consumer Affairs Ministry in July 2020 direct e-commerce companies to display the country of origin alongside product listings. On top of that they will also have to reveal the parameters that go behind determining product listings on their platforms.

While the requirement to display country of origin was already a necessity under the Legal Metrology (Packaged Commodities) Rules, 2011, the enforcement of these rules coincided with the ban of several Chinese-owned apps, followed by skirmishes between India and China at the border.

It is worth noting that a similar case was filed in the Delhi High Court against e-commerce platforms like Amazon, Flipkart, and Snapdeal, last year. During hearings in that case, the government had told the Delhi High Court that it is mandatory for e-commerce platforms such as Amazon, Flipkart, and Snapdeal to display the country of origin alongside imported products.

Petitioner alleges potential GST evasion

Since seller details aren’t mentioned on these platforms, GST details of these sellers are also not available, the petitioner alleged. It said that these companies “are also aiding and abetting the sellers to evade payment of GST to the Government Exchequer and to carry out sale of illegal products through these websites”.

“That economy of the entire nation would suffer in the event the E-Commerce websites continue not to mention the MRP, seller details, Manufacturing country / Country of Origin of products in the E- commerce Websites.” — Petitioner

Even in instances where these websites do show the country of origin of products, it is done in a “discre[et]” way, and isn’t easily searchable by consumers, the petitioner said, claiming that they discovered these instances following “due research”. “It is further seen that many declarations on Manufacturing are wrong and misfed into the online system giving no clarity to the Consumers,” it added.

The petitioner claimed to have bought items from GlowRoad, and said that there were no seller details even on the invoice. “It is also submitted that since merchantability of the product is responsibility of seller, if the details of seller is not made available to consumer he shall not be able to file any complaint against a seller,” the petition added.

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