A retail company, Cloudtail, sells goods on E-commerce platform. The company sold pressure cookers made by XYZ Limited, which were not compliant with the mandatory standards. On noticing the quality lapses, the consumer
CS Professional · Compliance Management, Audit and Due Diligence · PYQS · December 2024
A retail company, Cloudtail, sells goods on E-commerce platform. The company sold pressure cookers made by XYZ Limited, which were not compliant with the mandatory standards. On noticing the quality lapses, the consumer wanted their money back, along with damages from the Cloudtail. Whether the Cloudtail shall be liable for damages or XYZ Limited or both ? Substantiate your answers with reasons.
Answer & Explanation:
The facts are similar to the case came before the Central Consumer Protection Authority (CCPA) wherein Cloudtail took a plea that they are the sellers of the product and are not responsible for the quality issues. The Central Consumer Protection Authority (CCPA) has imposed on Cloudtail India a fine of ₹ 1 lakh for selling domestic pressure cookers to consumers in violation of mandatory standards prescribed under the Quality Control Orders and violating the rights of consumers. The company has also been asked for the price reimbursement of 1,033 pressure cookers to the consumers and is directed to submit the compliance report within 45 days. In the given case, the question the liability shall lie exclusively on Cloudtail. Cloudtail, a retail company selling pressure cookers on an e-commerce platform, was issued an order for unfair trade practice by selling domestic pressure cookers in violation of mandatory standards prescribed as per the Domestic Pressure Cooker (Quality Control) Order, 2020. XYZ Limited will be penalized in accordance with the specific applicable authority for violating quality standards in manufacturing.
Topics: Consumer Protection
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