Nikita Reports

CHAPTER – 1
INTRODUCTION
1.1 Introduction
The concept of consumer protection is a thought as old as human

civilization. Protecting the buyers’ interests is amongst the prime considerations of
the business. According to Mahatma Gandhi consumer is giving an opportunity
for the businesspersons to serve him and he is the ultimate purpose of the business
and we can even go to the extent of saying that according to certain interpretations
of some Indian traditions a customer/consumer is equivalent to God. But the profit
motive of the marketers, sellers and dealers is resulting in consumer exploitation
through deceitful and immoral market practices.
Consumer Protection is a socio-economic day to day activity that is

to be carried out by government and business with a prime objective of protecting
interests of consumers and their fair satisfaction. It is the prime responsibility of
the government to protect the rights and interest of consumers through
formulating suitable policies, laws and administrative framework. Different acts
and laws were incorporated to protect the consumers. But Consumer Protection
Act 1986 (CPA 1986) is considered as a milestone in the history of India for
consumers right. This paper examines the background and evaluation of
Consumer Protection act over a period of time.
This study is based on secondary data. This paper analyses the

background of CPA 1986, its implementation, post implementation, changes and
journey. Consumer protection is the practice of safeguarding buyers of goods and
services, and the public, against unfair practices in the marketplace.
Consumer protection measures are often established by law. Such

laws are intended to prevent businesses from engaging in fraud or specified unfair
practices to gain an advantage over competitors or to mislead consumers. They
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may also provide additional protection for the general public which may be
impacted by a product (or its production) even when they are not the direct
purchaser or consumer of that product. For example, government regulations may
require businesses to disclose detailed information about their products
particularly in areas where public health or safety is an issue, such as with food or
automobiles.
Consumer protection is linked to the idea of consumer rights and to

the formation of consumer organizations, which help consumers make better
choices in the marketplace and pursue complaints against businesses. Entities that
promote consumer protection include government organizations (such as
the Federal Trade Commission in the United States), self-regulating business
organizations (such as the Better Business Bureaus in the US, Canada, England,
etc.), and non-governmental organizations that advocate for consumer protection
laws and help to ensure their enforcement (such as consumer protection agencies
and watchdog groups).
A consumer is defined as someone who acquires goods or services

for direct use or ownership rather than for resale or use in production and
manufacturing. Consumer interests can also serve consumers, consistent with
economic efficiency, but this topic is treated in competition law. Consumer
protection can also be asserted via non-government organizations and individuals
as consumer activism.
Efforts made for the protection of consumer's rights and interests are:
1. The right to satisfaction of basic needs

2. The right to safety
3. The right to be informed
4. The right to choose
5. The right to be heard
6. The right to redress
7. The right to consumer education
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8. The right to a healthy environment
Consumer protection law or consumer law is considered as an area

of law that regulates private law relationships between individual consumers and
the businesses that sell those goods and services. Consumer protection covers a
wide range of topics, including but not necessarily limited to product
liability, privacy rights, unfair business practices, fraud, misrepresentation, and
other consumer/business interactions. It is a way of preventing frauds and scams
from service and sales contracts, eligible fraud, bill collector regulation, pricing,
utility turnoffs, consolidation, personal loans that may lead to bankruptcy. There
have been some arguments that consumer law is also a better way to engage in
large-scale redistribution than tax law because it does not necessitate legislation
and can be more efficient, given the complexities of tax law.
In India, consumer protection is specified in The Consumer

Protection Act, 2019. Under this law, Separate Consumer Dispute Redress Forums
have been set up throughout India in every district in which a consumer can file
their complaint on a simple paper with nominal court fees and their complaint will
be decided by the Presiding Officer of the District Level. The complaint can be
filed by both the consumer of a goods as well as of the services. An appeal could
be filed to the State Consumer Disputes Redress Commissions and after that to the
National Consumer Disputes Redresa Redressalsion (NCDRC). The procedures in
these tribunals are relatively less formal and more people-friendly and they also
take less time to decide upon a consumer dispute when compared to the years-
long time taken by the traditional Indian judiciary. In recent years, many effective
judgments have been passed by some state and National Consumer Forums.
Indian Contract Act, 1872 lays down the conditions in which

promises made by parties to a contract will be legally binding on each other. It
also lays down the remedies available to the aggregate party if the other party fails
to honor their promise.
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The Sale of Goods Act of 1930 provides some safeguards to buyers
of goods if goods purchased do not fulfill the express or implied conditions and
warranties.
The Agriculture Produce Act of 1937 act provides grade standards

for agricultural commodities and livestock products. It specifies the conditions
which govern the use of standards and lays down the procedure for grading,
marking, and packaging of agricultural produce. The quality mark provided under
the act is known as AGMARK-Agriculture Marketing.
Consumer protection is the practice of safeguarding buyers of

goods and services against unfair practices in the market. It refers to the steps
adopted for the protection of consumers from corrupt and unscrupulous
malpractices by the sellers, manufacturers, service providers, etc. and to provide
remedies in case their rights as a consumer have been violated.
In India, the protection of the rights of the consumers is

administered by the Consumer Protection Act, 2019. The Consumer Protection
Act, 2019 was introduced to replace the Consumer Protection Act, 1986. The new
Act contains various provisions which incorporate the challenges faced by modern
and technology-dependent consumers. The Act also contains various provisions
for the protection and promoting the rights of the consumers.
India’s enormity, diversity and distinctive cultural fabric have

combined to present the country’s government with unique challenges. How does
the world’s largest democracy reach citizens across geographic, linguistic and
administrative lines in a cost effective way? More specifically, how does the
Indian Government provide services to citizens while including them in the
governing process? The answer, most certainly, centers on electronic delivery of
services and citizen interactions with government officials. It is providing
government services to remote villages via Community Service Centers, or
interacting with citizens on mobile phones. This is e-Commerce, which provides
the potential to reach India’s remote villages with government services and
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information as never before, and as a by-product, to simplify cumbersome
governmental processes
The Indian Government’s National e-Commerce Plan aims, among

other things, to “make all government services accessible to the common man in
his locality through common service delivery outlets.” It was clear at the
Conference that the plan has achieved some success through a number of pilot
projects. However, it was also evident that government alone cannot ensure
“efficiency, transparency and reliability of such services at affordable costs.” The
private sector needs to engage in e-Commerce and play a role in expanding access
across India. Thus, as the following report details, the Conference recommended
greater attention to public-private partnerships, policy reform and infrastructural
changes as ways to deliver more efficient and effective e-Commerce across India.
The National Informatics Centre (NIC), a part of the Government

of India’s Department of Information Technology (DIT), was setup in 1977. Its
mandate was to develop information systems for government in the centre and
states to assist with planning, monitoring and decision-making. The mandate also
included setting up a nationwide communications network to enable effective
sharing of information among government staff. The NIC was responsible for
evolving standards for data collection, sharing and processing. In the last decade
or so, there have been several important initiatives to leverage ICTs to deliver
government services to citizens. The initial focus was to use ICTs in small towns
or rural areas to enable them to claim their entitlements—such as government
allowances, and subsidies to disadvantaged com.
In 2006, India launched its new National e-Commerce Plan. It dealt

with issues of political ownership, continuity of authority, resources, scale and
scope, and a framework for engagement with state governments. At the core of the
NeGP is the creation of service delivery points or Common Service Centres
(CSCs) within a 2km radius of all citizens across India. The government is
collaborating with several private sector players during the years 2009-1010 to set
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up over 100,000 CSCs equipped with appropriate ICTs equipment and
connectivity. The goal is to make all government services available through the
CSCs to “ensure efficiency, transparency, and reliability of such services at
affordable cost to meet basic needs”.
When fully implemented, CSCs will provide assisted access to

government services including employment, taxation, registration of companies,
pension records, land and property records, police, courts, municipal services,
access to records and services of Gram Panchayats(or village councils) and many
more services.
The State Wide Area Networks (SWAN) and State Data

Centres(SDC) complement the CSC’s delivery infrastructure. SWANs in each
state will connect state headquarters to each block (typically a cluster of 50
villages). SDCs will provide secure storage of government and citizen data and
applications by employing appropriate technologies including those for disaster
recovery and support for remote maintenance and management
Summary – Here in the chapter – 1 we have studied the basic
introduction about the e-Commerce and consumer protection in India.
In the next chapter – 2 we will study about the history of consumer

protection act 1986 to 2019
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CHAPTER – 2
HISTORY OF CONSUMER PROTECTION 1986 TO 2019.
Consumer protection in India has been a part of its culture and

civilization. The Consumer protection in India can be studied with reference to the
four main historical periods viz. Ancient, Medieval, during the British time and
Post-Independence.
The Consumer Protection Act, 1986 (COPRA) was an Act by

the Parliament of India elected to protect the interests of consumers in India. It
was replaced by the Consumer Protection Act, 2019. It was made for the
establishment of consumer councils and other authorities for the settlement of
consumer's grievances and matters connected with it. The act was passed in
Assembly in October 1986 and came into force on December 24, 1986. The
statute on the right was made before this COPRA act 1986.
The industrial revolution and the development in international trade

and commerce has led to the vast expansion of business and trade, as a result of
which a variety of consumer goods have appeared in the market to cater to the
needs of the consumers and a host of services have been made available to the
consumers like insurance, transport, electricity, housing, entertainment, finance
and banking. A well organised sector of manufacturers and traders with better
knowledge of markets has come into existence, thereby affecting the relationship
between the traders and the consumers making the principle of consumer
sovereignty almost inapplicable.
The advertisements of goods and services in television, newspapers

and magazines influence the demand for the same by the consumers though there
may be manufacturing defects or imperfections or short comings in the quality,
quantity and the purity of the goods or there may be deficiency in the services
rendered. In addition, the production of the same item by many firms has led the
consumers, who have little time to make a selection, to think before they can
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purchase the best. For the welfare of the public, the glut of adulterated and sub-
standard articles in the market have to be checked. In spite of various provisions
providing protection to the consumer and providing for stringent action against
adulterated and sub-standard articles in the different enactments like Code of Civil
Procedure, 1908, the Indian Contract Act, 1872, the Sale of Goods Act, 1930, the
Indian Penal Code, 1860, the Standards of Weights and Measures Act, 1976 and
the Motor Vehicles Act, 1988, very little could be achieved in the field of
Consumer Protection. Though the Monopolies and Restrictive Trade Practices
Act, 1969 arid the Prevention of Food Adulteration Act, 1954 have provided relief
to the consumers yet it became necessary to protect the consumers from the
exploitation and to save them from adulterated and sub-standard goods and
services and to safe guard the interests of the consumers. In order to provide for
better protection of the interests of the consumer the Consumer Protection Bill,
1986 was introduced in the Lok Sabha on 5th December, 1986.
2.2 Consumer Protection Act, 2019
The Consumer Protection Act, 2019 was introduced in the Lok

Sabha as a replacement of COPRA, 1986 on 8 July 2019 by the Minister of
Consumer Affairs, Food and Public Distribution, Ram Vilas Paswan. It was passed
by Lok Sabha on 30 July 2019 and later passed in Rajya Sabha on 6 August 2019.
The bill received assent from President Ram Nath Kovind on 9

August, and was notified in The Gazette of India on the same date. The Act came
into effect by 20 July 2020, while certain other provisions of the Act like
establishing the Central Consumer Protection Authority came into effect from 24
July 2020.
The Act features focuses on giving customer more power by taking

transparency to another level. In September 2020 government declared a new draft
known as advertising code which gives customer protection against false
advertisements.
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2.3 Consumer Protection in Ancient India
The concept of consumer protection against unscrupulous, unfair

and unethical malfunction practices and safeguarding the interest of consumers
was a part of Indian culture, business and administration for centuries in the
ancient times. References to it can be seen in Ancient Indian Dharmas like Manu
Smriti (800 BC- 600 BC), TheYajnavalkyaSmriti (300 B.C. - 100 B.C), The
NaradaSmriti (100 A.D.- 200 A.D.), The Brihaspatismriti (200A.D.- 400 A.D.) In
the KatyayanaSmriti (300 A.D.- 600 A.D) were explained the living conditions of
the people of that time and were basis on the Dharma to be followed at that time.
They were even the premise for the system that is being followed currently. In
India, Manu Smriti was one of the most influential texts that dealt with various
consumer matters. Arthashastra of Kautilya is considered as one of the oldest and
a very effective book on trade and commerce in ancient India. Kautilya( Chanakya
) has mentioned different punishments to be given to sellers who involve
themselves in different kinds of exploitations, and wrong measures. The consumer
protection was a common part of the ancient laws. (Shamasastri, 1951)
2.4 Medieval period and Pre-independence
During the medieval period Muslim kings who ruled India, like
AlauddinKhilji, Sher Shah Suri, and Akbar etc., thought about protecting the
shoppers and consumers and they enacted strict laws for the same. They
introduced weights, measures standardization process.
2.5 The modern and British times
British rulers combined the previous customs and culture (dharma)

with a unified nationwide system that had similarities with the laws already
enacted in Britain. (Prasad, 2008).
1. They introduced Acts like:

2. The Indian Penal Code, 1860
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3. Carriers Act, 1865 Law of Tort
4. The Indian Contract Act, 1872
5. Sale of Goods act 1930
6. The Agricultural Product (Grading & Marking) Act, 1937
7. The Drugs and Cosmetics Act, 1940
2.6 Post Independence
After independence, many laws were enacted in India for

safeguarding innocent customers from unfair and restrictive trade practices sort of
a false and dishonorable description regarding the character and quality of the
goods exaggerated statements concerning their power and efficiency, false weights
and measurements and obstruction of capital and resources into the stream of
production. The Acts that were enacted and covered the whole of the Republic of
India are given below-
1. The Drugs Control act, 1950

2. The Industries (Development and Regulations) Act, 1951
3. The Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954
4. The Prevention of Food Adulteration Act, 1954
5. The Essential Commodities Act, 1955
6. The Trade and Merchandise Marks Act, 1958
7. The Monopolies and Restrictive Trade Practices Act, 1969, Compition Act
2002
8. The Cigarettes (Regulation of Production, Distribution, and Supply) Act,
1975
9. The Standards of Weights and Measures Act, 1976
10. The Prevention of Black Marketing and Maintenance of Supplies of
Essential
11. Commodities Act, 1980
12. The Standards of Weights and Measures (Enforcement) Act, 1985
13. The Bureau of Indian Standards Act, 1986
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But of these Acts weren't as effective, focused and did not cater to
needs all sections of the population. There was a need for a focused and strong
law to ensure for better protection of the interests of shoppers and consumers and
to save them from the evils of unfair trade practices and for this the Protection Act
-1986 was enacted by Indian Government. The various amendments in this Act
unto 2019 give it more teeth and power to consumers but do not tamper with the
basic spirit of the Act of 1986.
The industrial revolution and the development in the international

trade and commerce has led to the vast expansion of business and trade, as a result
of which a variety of consumer goods have appeared in the market to cater to the
needs of the consumers and a host of services have been made available to the
consumers like insurance, transport, electricity, housing, entertainment, finance
and banking. A well organised sector of manufactures and traders with better
knowledge of markets has come into existence, thereby affecting the relationship
between the traders and the consumers making the principle of consumer
sovereignty almost inapplicable. The advertisements of goods and services in
television, newspapers and magazines influence the demand for the same by the
consumers though there may be manufacturing defects or imperfections or short
comings in the quality, quantity and the purity of the goods or there may be
deficiency in the services rendered. In addition, the production of the same item
by many firms has led the consumers, who have little time to make a selection, to
think before they can purchase the best. For the welfare of the public, the glut of
adulterated and sub-standard articles in the market have to be checked. Inspite of
various provisions providing protection to the consumer and providing for
stringent action against adulterated and sub-standard articles in the different
enactments like Code of Civil Procedure, 1908, the Indian Contract Act,1872, the
sale of goods Act,1930, the Indian Penal Code, 1860,the Standards of Weights and
Measures Act,1976 and the Motor Vehicles Act,1988, very little could be achieved
in the field of Consumers Protection. Though the Monopolies and Restrictive
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Trade Practices Act,1969 and the Prevention of Food Adulteration Act, 1954 have
provided relief to the consumers yet it became necessary to protect the consumers
from the exploitation and to save them from adulteration and sub-standard goods
and services and to safe guard the interests of the consumers. In order to provide
for better protection of the interests of the consumer the Consumer Protection
Bill,1986 was introduced in the Lok Sabha on 5th December,1986.
An Act to provide for better protection of the interests of

consumers and for that purpose to make provision for the establishment of
consumer councils and other authorities for the settlement of consumer' disputes
and for matters connected therewith. Be it enacted by Parliament in the Thirty-
seventh Year of the Republic of India.
Summary – Here in the chapter – 2 we have studied about the

history of consumer protection act 1986 to 2019
In the next chapter – 3 we will study about Consumer protection
act 1986 and CPA 2019.
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CHAPTER – 3
CONSUMER PROTECTION ACT 1986 AND 2019
The consumer protection act 1986 notes give detailed information

on the Consumer Protection Act, 1986, which was approved to provide quicker
and simpler access to redressal consumer grievances.
Consumer Protection Act 1986 was enacted for superior protection

of the interest of consumers. The provision of the Act came into force from 15-04-
1987. Consumer Protection Act forced strict liability on a manufacturer in case of
the supply of faulty goods by him and strict liability on a service provider in case
of shortage in rendering his services.
To safeguard the interests and rights of consumers, quasi-judicial

machinery is sought to be set up at the district, state and central levels. This Act
applies to the whole of India except the state of Jammu and Kashmir. This Act was
replaced by the ‘Consumer Protection Act 2019’ which came into force on 24th
July 2020.
3.2 What is the Consumer?
Consumer refers to persons or households that use goods and

services generated within the economy. The consumer is defined as someone who
obtains goods or services for direct use or possession rather than for exchange,
resale or use in production and manufacturing.
For example: When your mother buys apples for you and consumes
them, your mother and yourself are treated as consumers.
3.3 Concept of Consumer Protection
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Consumer protection means protecting the rights and interests of
consumers. In other words, it refers to the measures taken to protect consumers
from unprincipled and unethical misconduct by the business and provide them
quick redressal of their grievances.
3.4 Features of Consumer Protection Act, 1986
1. It applies to all goods, services and inequitable trade practices unless

specified and exempted by the Central Government
2. It covers all sectors, private, public or co-operative
3. It provides the establishment or setting up of consumer protection councils
at the district, state and central levels to encourage and protect the rights of
consumers and three-tier quasi-judicial machinery to deal with consumer
grievances and disputes
4. Objectives of Consumer Protection
5. To protect the consumer from abuse
6. To provide a venue for grievances/compensation
7. To ensure a superior quality of living by upgrading consumer products and
services
8. Protecting the consumer against immoral and unfair activities of the
traders
3.5 Need for Consumer Protection Act
The necessity of acquiring measures to protect the interest of

consumers come to light mainly due to the vulnerable position of the consumers.
Social Responsibility: It is the moral responsibility of the business

to serve the interest of consumers. In line with this principle, producers and
traders have to provide the right quality and quantity of goods at fair prices.
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Increasing Awareness: Consumers are becoming more mature and
conscious of their rights against the malpractices of the business. Many consumer
organisations and associations are making efforts to build consumer awareness.
Consumer Satisfaction: The Father of the Nation, Mahatma

Gandhi, had once called manufacturers and traders to” treat your consumers as
god”. Consumer satisfaction is the only key to the success of the business. Hence,
people in business should take every step to serve the interests of consumers by
providing them quality goods and services at a reasonable price.
Survival and Growth of Business: Businesses have to be in the

service of consumer interests for their survival and growth. On account of
globalisation and the rise in competition, any business organisation which
indulges in malpractices or fails to provide improved services to its ultimate
consumer shall find it difficult to continue.
Principle of Trusteeship: Resources/Assets were contributed by

society. They are merely the trustees of the wealth and, therefore, they should use
such resources effectively for the sake of the community, which includes the
consumer.
3.6 Rights of the Consumer
Right to Safety – To be secured against the marketing of goods on

delivering dangerous services to health and life
Right to Information – To be protected against dishonest or

misleading advertising or labelling and the right to be given the facts and figures
needed to make an informed choice
Right to Choice –To choose products at competitive prices with an

assurance of satisfactory quality
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Right to Representation – To express consumer interests in the
making and execution of government policies
Right to Seek Redress – To be compensated for misrepresentation,

shoddy goods or unsatisfactory services
Right to Consumer Education –To Acquire the Knowledge and

skills necessary to be an informed customer
Right to Basic Needs – This Guarantees adequate food, shelter,

health care, clothing, education and sanitation
Filing a Complaint There are three tier Consumer Grievances

machinery under the Consumer Protection Act, 1986 and their jurisdiction.
District Forum – The value of goods or compensation claim does

not exceed Rs. 20 lakh.
State Forum – The value of goods or compensation is more than

Rs. 20 lakh but does not exceed one crore.
National Forum – It takes up all the cases exceeding the value of

Rs. 1 crore.
In India, the protection of the rights of the consumers is

administered by the Consumer Protection Act, 2019. The Consumer Protection
Act, 2019 was introduced to replace the Consumer Protection Act, 1986. The new
Act contains various provisions which incorporate the challenges faced by modern
and technology-dependent consumers. The Act also contains various provisions
for the protection and promoting the rights of the consumers.
3.8 Meaning of the word ‘consumer’
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A consumer is an individual or group of individuals who purchase
goods and services for their own personal use and not for the purpose of
manufacturing or resale. Section 2(7) of the Consumer Protection Act, 2019
defines a consumer as any person who buys goods or services in exchange for
consideration and utilises such goods and services for personal use and for the
purpose of resale or commercial use. In the explanation of the definition of
consumer, it has been distinctly stated that the term ‘buys any goods’ and ‘hires or
avails any services’ also includes all online transactions conducted through
electronic means or direct selling or teleshopping or multi-level marketing.
3.9 Need for the Consumer Protection Act, 2019
The Consumer Protection Act, 2019 was enacted by the Indian

legislature to deal with matters relating to violation of consumer’s rights, unfair
trade practices, misleading advertisements, and all those circumstances which are
prejudicial to the consumer’s rights. The intention of the Parliament behind
enacting the Act was to include provisions for e-consumers due to the
development of technology, buying and selling of goods and services online have
considerably increased during the last few years.
The Act seeks to provide better protection of the rights and

interests of the consumers by establishing Consumer Protection Councils to settle
disputes in case any dispute arises and to provide adequate compensation to the
consumers in case their rights have been infringed. It further provides speedy and
effective disposal of consumer complaints through alternate dispute resolution
mechanisms. The Act also promotes consumer education in order to educate the
consumer about their rights, responsibilities and also redressing their grievances.
3.10 Objective of the Consumer Protection Act, 2019
The main objective of the Act is to protect the interests of the

consumers and to establish a stable and strong mechanism for the settlement of
consumer disputes. The Act aims to:
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Protect against the marketing of products that are hazardous to life
and property. Inform about the quality, potency, quantity, standard, purity, and
price of goods to safeguard the consumers against unfair trade practices.
Establish Consumer Protection Councils for protecting the rights

and interests of the consumers.
Assure, wherever possible, access to an authority of goods at

competitive prices. Seek redressal against unfair trade practices or unscrupulous
exploitation of consumers.
Protect the consumers by appointing authorities for timely and

sufficient administration and settlement of consumers’ disputes.
Lay down the penalties for offences committed under the Act. Hear
and ensure that consumers’ welfare will receive due consideration at appropriate
forums in case any problem or dispute arises.
Provide consumer education, so that the consumers are able to be

aware of their rights. Provide speedy and effective disposal of consumer
complaints through alternate dispute resolution mechanisms.
3.11 What are consumer rights under Consumer Protection Act, 2019
1. There exist six rights of a consumer under the Consumer Protection Act,
2019. The rights of the consumers are mentioned under Section 2(9) of the
Act, which are as follows:
2. The right of a consumer to be protected from the marketing of goods and
services that are hazardous and detrimental to life and property.
3. The right of a consumer to be protected against unfair trade practices by
being aware of the quality, quantity, potency, purity, standard and price of
goods, products or services.
4. The right of a consumer to have access to a variety of goods, services and
products at competitive prices.
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5. The right to seek redressal at respective forums against unfair and
restrictive trade practices.
6. The right to receive adequate compensation or consideration from
respective consumer forums in case they have been wronged by the seller.
7. The right to receive consumer education.
3.12 What are unfair trade practices under Consumer Protection Act, 2019
1. Section 2(47) of the Consumer Protection Act, 2019 defines the term
‘unfair trade practices’ which include:
2. Manufacturing spurious goods or providing defective services.
3. Not issuing cash memos or bills for the goods purchased or services
rendered.
4. Refusing to take back or withdraw the goods or services and not refunding
the consideration taken for the purchase of the goods or services.
5. Disclosing the personal information of the consumer.
3.13 Changes incorporated in Consumer Protection Act, 2019
The changes that were incorporated with the enactment of the

Consumer Protection Act, 2019 are:
The District Commissions will have the jurisdiction to entertain

complaints where the value of the goods, services or products paid as
consideration to the seller does not exceed 50 lakh rupees.
State Commissions will have the jurisdiction to entertain

consideration to the seller exceeds 50 lakh rupees but does not exceed two crore
rupees.
The National Commission will have the jurisdiction to entertain

consideration to the seller exceeds two crore rupees.
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The Act further states that every complaint concerning consumer
dispute shall be disposed of as expeditiously as possible. A complaint filed under
this Act shall be decided within the period of three months from the date of receipt
of notice by the opposite party in the cases the complaint does not require analysis
or testing of the goods and services and within a period of 5 months, if it requires
analysis or testing of the goods and services.
The Consumer Protection Act, 2019 also facilitates the consumers

to file complaints online. In this regard, the Central Government has set up the E-
Daakhil Portal, which provides a convenient, speedy and inexpensive facility to
the consumers all over India so that they are able to approach the relevant
consumer forums in case of any dispute arises.
3.14 The Act lays down the scope for e-commerce and direct selling.
The Consumer Protection Act, 2019 lays down provisions for

mediation and alternative dispute resolution so that the parties are able to dispose
of the case conveniently without going through the trouble of litigation.
The Consumer Protection Act, 2019 contains provisions for

product liability, unfair contracts and it also includes three new unfair trade
practices. In contrast, the old Act just stated six types of unfair trade practices.
The Act of 2019 acts as the advisory body for the promotion and
protection of consumer rights.
Under the Consumer Protection Act, 2019 there is no scope for

selection committees, the Act authorises the Central Government to appoint the
members.
Therefore, with the changes in the digital era, the Indian Parliament
enacted and brought the Consumer Protection Act, 2019 in force to include the
provisions for e-commerce as digitalization has facilitated convenient payment
mechanisms, variety of choices, improved services, etc.
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3.15 Essential provisions of Consumer Protection Act, 2019
The essential provisions of the Consumer Protection Act, 2019 are:
Consumer Protection Councils
The Act establishes consumer protection councils to protect the

rights of the consumers at both the national and state levels.
Central Consumer Protection Council
Under Chapter 2 Section 3 of the Consumer Protection Act, 2019

the Central Government shall establish the Central Consumer Protection Council
which is known as the Central Council. It is an advisory body and the Central
Council must consist of the following members;
The Minister-in-charge of the Department of Consumer Affairs in

the Central Government will be appointed as the chairperson of the council, and
Any number of official or non-official members representing

necessary interests under the Act.
The Central Council may meet as and when necessary, however,

they must hold at least one meeting every year. The purpose of the Central
Council is to protect and promote the interests of the consumers under the Act.
State Consumer Protection Councils
1. Every state government shall establish a State Consumer Protection

Council known as the State Council having jurisdiction over that particular
state. The State Council acts as an advisory body. The members of the
State Council are:
2. The Minister-in-charge of the Consumer Affairs in the State Government
will be appointed as the chairperson of the council,
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3. Any number of official or non-official members representing necessary
interests under the Act, and
4. The Central Government may also appoint not less than ten members for
the purposes of this Act.
5. The State Councils must hold at least two meetings every year.
District Consumer Protection Council
Under Section 8 of the Act, the state government shall establish a

District Consumer Protection Council for every district known as the District
Council. The members of the District Council are:
The collector of that district will be appointed as the Chairperson

of the District Council, and Any other members representing necessary interests
under the Act.
Central Consumer Protection Authority
The Central Government shall establish a Central Consumer

Protection Authority which is known as the Central Authority under Section 10 of
the Consumer Protection Act, 2019, to regulate matters relating to violation of the
rights of consumers, unfair trade practices and false or misleading advertisements
which are prejudicial to the interests of the public and consumers and to promote,
protect and enforce the rights of consumers. The Central Government will appoint
the Chief Commissioner and the other Commissioners of the Central Authority as
required under the Act.
The Central Authority must have an ‘Investigative Wing’

under Section 15 of the Act to conduct an inquiry or investigation. The
investigative wing must comprise of the Director-General and the required
number of Additional Director-General, Director, Joint Director, Deputy Director
and Assistant Director possessing the required experience and qualifications to
22
carry out the functions under this Act. Functions and duties of the Central
Authority
The functions and responsibilities of the Central Authority are laid

down in Section 18 of the Act which includes;
1. To protect and promote the rights of the consumers as a class and to

prevent violation of consumer rights,
2. To prevent unfair trade practices,
3. To ensure no false or misleading advertisements regarding any goods or
services are promoted,
4. To ensure no person takes part in false or misleading advertisements,
5. Inquire or investigate in cases of violation of consumer rights or unfair
trade practices.
6. File complaints before the National, State or District Commission as the
case may be,
7. To review matters relating to the factors hindering the enjoyment of
consumer rights.
8. To recommend the adoption of international covenants and best
international practices concerning consumer rights
9. Promote research and awareness of consumer rights.
10. Lay down necessary guidelines to prevent unfair trade practices and
protect the interests of the consumers.
Furthermore, the Central Authority also has the power to

investigate after receiving any complaint or directions from the Central
Government or of its own motion in cases where there is an infringement of
consumer rights or unfair trade practices are carried out. And if the Central
Authority is satisfied that infringement of consumer rights or unfair trade practices
has occurred then it may:
Recall the goods or services which are hazardous and detrimental

to the consumers, Reimburse the prices of the goods and services to the
23
consumers, and Discontinue the practices that are prejudicial and harmful to the
consumers.
Under Section 21 of the Act, the Central Authority is authorised to

issue directions to false and misleading advertisements which may extend to ten
lakh rupees. While determining the penalty of the offence the Central Authority
must keep in mind factors such as; the population affected by the offence,
frequency of the offence and gross revenue from the sales of such product. The
Central Authority can also direct search and seizure for the purposes of this Act
and in that case the provisions of the Criminal Procedure Code, 1973 will apply.
3.16 Consumer disputes redressal commission
The state government shall establish a District Consumer Disputes

Redressal Commission, known as the District Commission in each district of the
state under the Consumer Protection Act, 2019. The District Commission shall
comprise of a President and not less than two members prescribed by the Central
Government.
Section 34 of the Act authorises the District Commission to

entertain complaints where the value of the goods or services paid as
consideration does not exceed one crore rupees. The complaint relating to goods
and services can be filed to the District Commission by the consumer, recognized
consumer association, Central Government, Central Authority, State Government,
etc.
Section 36 states that all the proceedings before the District

Commission shall be conducted by the President and at least one member of the
commission.
Mediation
Chapter 5 Section 74 of the Consumer Protection Act, 2019 states

that a Consumer Mediation Cell shall be established by the Central Government at
24
the national level and every state government shall establish Consumer Mediation
Cell exercising within the jurisdiction of that state. The mediator nominated to
carry out the mediation shall conduct it within such time and in such manner as
may be specified by regulations.
Section 75 of the Act talks about the empanelment of the

mediators. It states the qualifications, terms and conditions of service, the
procedure for appointing, and the fee payable to the empanelled mediators.
It is the duty of the mediator to disclose certain facts such as; any
personal, financial or professional in the result of the consumer dispute, the
circumstances giving rise to their independence or impartiality and any other
necessary information for the protection of consumer rights.
Product liability
Under Section 83 of the Act, a product liability action may be

brought by a complainant against a product manufacturer, product service
provider or product seller.
Liability of product manufacturer
A product manufacturer will be held liable in a product liability action under

the following circumstances:
1. The product contains manufacturing defects.

2. The product is defective.
3. There is a deviation from manufacturing specifications.
4. The product does not conform to the express warranty.
5. The product fails to contain adequate information for proper usage.
6. Liability of product service provider
A product service provider will be held liable in a product liability

action under the following circumstances:
25
The service provider will be responsible when the service provided
by them is faulty or imperfect.
1. There was an act of negligence on their part.

2. The service provider failed to issue adequate instructions and warnings for
the services.
3. The service provider failed to conform to the express warranty or terms
and conditions of the contract.
4. Liability of product seller
5. A product seller will be held liable in a product liability action under the
following circumstances:
6. They altered or modified the product which resulted in being detrimental
to the consumer.
7. They failed to exercise reasonable care in assembling, inspecting or
maintaining such product
8. They exercised substantial control over the product which resulted in
causing harm to the consumer.
Exceptions to product liability
1. There are certain exceptions to product liability action mentioned

in Section 87 of the Act, such as;
2. The product was altered, modified or misused by the consumer,
3. A consumer cannot bring product liability action when the manufacturer
has given adequate warnings and instructions for the use of the product,
4. The manufacturer would not be liable in case of a product liability action
for not warning about any danger that is commonly known to the general
public.
5. Offences and penalties under Consumer Protection Act, 2019
6. The offences and penalties listed under this Act are mentioned as follows.
Punishment for false and misleading

advertisements: Under Section 89 of the Act any manufacturer or service provider
26
who promotes false or misleading advertisements will be punished with
imprisonment for a term that may extend to two years and with fine that may
extend to ten lakh rupees.
Punishment for manufacturing, selling, distributing products

containing adulterants: Under Section 90 of the Consumer Protection Act, 2019
any person who sells, manufactures, distributes products containing adulterants
shall be penalised in case of the following circumstances;
If the adulterated product does not cause any injury to the

consumer then the term for imprisonment will extend to a period of six months
and fine which may extend to one lakh rupees,
If the product containing adulterant causes injury not amounting to

grievous hurt then the term for imprisonment will extend to a period of one year
and fine which may extend to three lakh rupees,
If the product containing adulterant causes injury amounting to

grievous hurt then the term for imprisonment will extend to a period of seven
years and fine which may extend to five lakh rupees,
If the product results in causing death to the consumer then the

term for imprisonment will be for a period of seven years which may extend to
life imprisonment and fine not less than ten lakh rupees.
Punishment for manufacturing, selling, and distributing spurious

products: Section 91 states that any person who sells, manufactures, or distributes
spurious products shall be punished for such acts.
3.17 How do consumers benefit from Consumer Protection Act, 2019
The Consumer Protection Act, 2019 is a significant piece of

legislation brought as it is beneficial for the consumers. The Act widens the scope
of protection regarding the rights and interests of consumers.
27
Unfair contracts: The Act introduced ‘unfair contract’
under Section 2(46) of the Act, which includes contracts requiring excessive
security deposits to be given by the consumer for the performance of contractual
obligations. However, the inclusion of unfair contracts in the Act would enable the
consumer to file complaints in such cases and would also keep the fraudulent
businesses in check.
Territorial jurisdiction: The Act enables the consumers to file

complaints where the complainant resides or personally works for gain thus it
would benefit the consumers in seeking redressal for their grievances when their
rights have been violated.
False and misleading advertisements: The Act defines the term

‘false and misleading advertisements’ and also lays down strict penalties for such
acts or omissions.
Product liability: The term ‘product liability’ has been defined by

this Act, which states that it is the duty of the product manufacturer, service
provider or seller to compensate for any harm caused to a consumer by such
defective product manufactured or service provided to the consumer.
Mediation and alternative dispute resolution: The Act enables the

consumer to opt for mediation and alternative dispute resolution mechanisms for
speedy and effective settlement of consumer disputes.
E-filing of complaints: The Act also facilitates e-filling of the

complaints and seeking video conference hearings by the Commission. Thus,
providing convenient means for the consumers to voice their grievances.
Summary – Here in the chapter – 3 we have studied about
Consumer protection act 1986 and CPA 2019.
28
In the next chapter – 4 we will study the various judicial cases that
are basically based on the e-Commerce and consumer protection act in india.
CHAPTER – 4
JUDICIAL TRENDS
Case 1: Flipkart Internet Pvt Ltd vs Competition Commission of India: by

Karnataka High Court on 23 July, 2021
The present writ appeals are arising out of the common order
passed by the learned Single Judge dated 11.6.2021 in W.P.No.3363/2020 c/w
W.P.No.4334/2020, by which the learned Single Judge has dismissed the writ
petitions filed by both the petitioners.
The appellant-Flipkart Internet Private Limited is a Private Limited

Company incorporated under the Companies Act, 1956 having its registered office
at Bengaluru, Karnataka and it operates as an e-commerce platform and online
marketplace, which facilitates independent third party sellers to sell goods to
consumers. The appellant has about 200 million registered users and 15 million
transacting customers per month.
The facts of the case reveal that respondent No.2/Delhi Vyapar

Mahasangh filed an information on 24.10.2019 to Competent Commission of
India (CCI) under Section 19(1)(a) of the Competition Act, 2002 (hereinafter
referred to as the Act) against both the appellants alleging that the appellants are
29
involved in alleged anti-competitive practices and conduct, such as deep
discounting, preferential listing, sale of private label brands through preferential
sellers and exclusive tie-ups, alleged to be in violation of Section 3(1) r/w Section
3(4) of the Act.
It has been further stated that the CCI, based upon the information
received by it, has passed an order dated 13.1.2020 in case No.40/2019 directing
an investigation under Section 26(1) of the Act by the Director General. The order
dated 13.1.2020 was challenged before this Court and the learned Single Judge
has dismissed the writ petitions by an order dated 11.6.2021, which is under
challenge in the present two writ appeals.
The appellant-Flipkart has challenged the legality and validity of

the order passed by the learned Single Judge and a main ground has been raised
stating that the learned Single Judge has acted contrary to the judgment of the
Supreme Court of India in the case of Competition Commission of India v. Steel
Authority of India Ltd. & Anr., reported in (2010) 10 SCC 744, (hereinafter
referred to as CCI v. SAIL) while upholding the order passed by the Competition
Commission of India (hereinafter referred to as CCI). It has been contended that
the Hon'ble Supreme Court in CCI v. SAIL has held that the CCI while passing an
order under Section 26(1) of the Competition Act, 2002 (hereinafter referred to as
the Act of 2002) must express its mind in no uncertain terms that it is of the view
that prima facie case exists, requiring general issuance of direction for
investigation to the Director General.
It has been further contended that the order passed by the CCI in
the present case is merely speculative in nature and it has not given any finding on
the contravention of the provisions of the Act of 2002. It has been further
contended that the learned Single Judge has erroneously upheld the order passed
by the CCI on the basis that the order passed by the CCI is supported by some
reasoning. Therefore, the impugned order upholding the order passed by the CCI
30
is contrary to the judgment of the Hon'ble Supreme Court delivered in the case of
CCI v. SAIL.
It has been contended that the CCI failed to examine whether,

assuming that the allegations were established on an investigation (their veracity
was seriously in dispute), the agreements complained of would be violative
of Section 3(4) of the Act. It has been further contended that another fatal flaw in
the CCI Order is, the failure of the CCI to examine whether the alleged
agreements are between persons are enterprises at different stages or levels of the
production chain. 3.12. It has been contended that the phrase "production chain"
would necessarily imply that the arrangement/agreement relates to a product or a
group of products made by a manufacturer. If multiple manufacturers of a product
enter into an agreement, it is a matter to be examined under Section 3(3) of the
Act. Where the different persons at different stages acting under a manufacturer
enter into an agreement, such an agreement, being between persons at different
stages or levels of the production chain, would be such as to qualify for further
examination under Section 3(4) of the Act.
It has been further contended that the fundamental requirement is

that the person entering into an agreement should be a part of a production chain,
which commences from the manufacturer and ends with the retailer. It has been
further contended that the appellant is not a retailer and is not in the business of
(in fact is prohibited from) selling goods and cannot be considered to be a part of
the production chain. It has been stated that admittedly the appellant operates a
platform on which a large number of sellers, dealing with diverse commodities,
sell their goods. Hence, the appellant cannot be treated as a part of the production
chain for all the goods sold on its platform.
It has been stated that in the present case, on a perusal of the

submissions made by the CCI, it is clear that the CCI proceeded on the premise
that the requirement of the agreement relating to entities at different stages or
levels of the production chain was not a sine qua non, since other agreements
31
would also fall in the latter words of the provision. It has been further contended
that the CCI thus misdirected itself in law. An analysis of the material paragraphs
in the CCI Order as well as the submissions made by the CCI makes it apparent
that the CCI has not considered the factors in Section 19(3) while passing the CCI
Order. This is another fundamental misdirection in law and amounts to a failure to
take into account relevant considerations while forming the prima facie opinion. It
has been further stated that the CCI has asserted on affidavit before the learned
Single Judge that Section 19 is not considered at the stage of Section 26(1) of the
Act. During the oral submissions before the learned Single Judge, the CCI took
the position that the word "inquiry" in Section 19(1) must mean that Section
19(3) does not come into play at the stage of formation of opinion under Section
26(1) of the Act. This construction by the CCI is in the teeth of Section 19 of the
Act.
It has been contended that the CCI Order in the present case fails to
meet the aforesaid jurisdictional threshold, as it does not record "formation of an
opinion" in "no uncertain terms". In other words, there is no mention of formation
of an opinion by the CCI on any contravention of the provisions of the Act by the
appellant. It is further contended that the CCI Order merely reiterates the
allegations of the Informant and makes some cursory remarks, stating that the
allegations 'merit an investigation'. It has been further contended that there is not
even a single instance in the CCI Order (and the CCI has also failed to
demonstrate the same before this Court from the CCI Order or otherwise from the
material available), wherein the CCI, assuming all the allegations against the
appellant to be true and correct, concludes that such allegations constitute a
contravention of the provisions of the Act. In the absence of such a "formation of
an opinion", leave alone being "substantiated" even by "minimum reasons", the
CCI Order has been passed contrary to the provisions of Section 26(1) of the Act
itself and deserves to be set aside by this Hon'ble Court.
Regarding an Order under Section 26(1), the CCI is required to

form only a preliminary/tentative view, it has been contended by the learned
32
counsel for the appellant that the CCI having failed to satisfy the jurisdictional
threshold of "formation of an opinion" itself, cannot be permitted to defend its
order by stating that an order under Section 26(1) of the Act is merely a
preliminary/tentative view. In other words, even if the submission made by the
CCI is accepted, the CCI Order fails to record any view of contravention of the
provisions of the Act leave alone preliminary/tentative view. A preliminary or
tentative view does not mean that the opinion is sans intelligible reasons. Even on
this count, even assuming the submission made by the CCI to be correct, the CCI
Order deserves to be set aside as the CCI has failed to establish a prima facie of
contravention of the provisions of the Act in certain terms, as it is required to do
so under Section 26(1) of the Act.
It is stated that therefore, it may not be correct to aver that an order

under Section 26(1) does not entail any civil consequences. On the contrary, an
order under Section 26(1) has very serious consequences, which casts an
additional responsibility on the CCI to ensure that the jurisdictional threshold are
satisfied prior to referring a matter for investigation under Section 26(1) of the
Act. 3.21.11. It has been contended that the CCI relied on Cadila Healthcare v
CCI, (2018) 252 DLT 647(Cadila Case) to argue that there is no harm to business
reputation due to an inquiry under Section 26(1) of the Act. However, the reliance
on the Cadila Case is misplaced and erroneous, given that the Cadila Case has
been challenged before the Hon'ble Supreme Court and the Hon'ble Supreme
Court has passed an interim order that no coercive steps can be undertaken, and as
such, the reliance on the Cadila Case is misplaced. It is stated that the CCI has
sought to rely on the number of informations received and number of cases
directed for investigation. It is further stated that the same is irrelevant for the
purposes of the present case, as the validity of the CCI Order will be examined
solely on the basis of reasons set out in the CCI Order alone and not on the basis
of number of other cases directed for investigation by the CCI.
It has been contended that the CCI averred before the learned
Single Judge that the proceedings under Section 26 of the Act are time-bound and
33
should not be delayed in the interest of a free and fair market and economy. It is
further contended that the CCI is mandated under the provisions of the Act to only
direct an investigation after forming a prima facie opinion of contravention of the
provisions of the Act, in no uncertain terms. An investigation cannot be directed
merely on the grounds that proceedings before the CCI are time bound and such
proceedings are in the interest of a free and fair market and economy. The
averment of the CCI is contrary to the scheme of the Act, which unambiguously
mandates that an investigation can only be directed by the CCI after the formation
of a prima facie opinion of contravention of the provisions of the Act, based on
due consideration of the factors laid down under Section 19(3) of the Act. It has
been further stated that by way of such submissions that the CCI has attempted to
circumvent its statutory mandate set out under Section 26(1) of the Act.
Regarding the CCI is merely required to record "some reasons", it

has been contended that the CCI has sought to defend the CCI Order by
submitting that since it is required to record only "some reasons" in an order
under Section 26(1) of the Act, the CCI Order is a valid order. However, such
submission is incorrect and is premised on a selective reading of the judgment of
the Hon'ble Supreme Court in CCI v. SAIL and completely ignores para 97 of the
judgment. The Hon'ble Supreme Court in para 97 of the CCI v. SAIL judgment
has observed that "at the stage of forming a prima facie view, as required
under Section 26(1) of the Act, the Commission may not really record detailed
reasons but must express its mind in no uncertain terms that it is of the view that
prima facie case exists, requiring issuance of direction for investigation to the
Director General". Therefore, though the CCI is required to record "some" or
"minimum" reasons in an order under Section 26(1) of the Act, it is not absolved
from expressing its prima facie opinion of contravention of the provisions of the
Act in "no uncertain terms" and therefore, as the CCI has failed to do so in the
CCI Order and on this ground alone, the CCI Order should be set aside.
It has been contended that the CCI Order failed to even refer to its
earlier order in the AIOVA Case where it had come to a categorical conclusion
34
that there were no structural links between the appellant and any of its sellers
including in particular WS Retail. As a regulator, it was mandatory for the CCI, to
follow the factual findings recorded by it in the AIOVA Case in relation to the
same entities. However, the CCI Order fails to do so, let alone even refer to the
AIOVA Order while directing investigation against the appellant. It is stated that
the appellant had categorically submitted before the learned Single judge
that there were no structural links (by way of any shareholding, board
representation, or management rights, or commonality of employees or offices)
between the appellant and the sellers on the its marketplace platform. Indeed, this
structural link is seminal, as it is on the reliance of this link, that the CCI accepts
the allegations against the appellant. It is on the basis of the alleged structural
links (which do not exist in case of the appellant) that the CCI arrived at its prima
finding of preferred sellers/preferential treatment. Considering that the CCI in the
AIOVA Case already noted the absence of such structural links, the CCI ought not
to have directed the investigation against the appellant for the same facts.
It has been contended that the allegation against the appellant is

that Omnitech, a seller on the appellant's online marketplace platform, is owned
by Consulting Rooms Pvt Ltd, whose director Mr Ajay Sachdeva was also a
director of WS Retail in 2016. However, as the CCI had already noted that there
were no structural links between the appellant and WS Retail after 2012, any link
between Omnitech and WS Retail in 2016 is irrelevant and cannot be even prima
facie considered to constitute a link with the appellant, as the CCI has
incorrectly noted. It is stated that in its submissions, the CCI has sought to assign
various reasons to justify a complete deviation from its AIOVA Order. It is
submitted that none of the reasons now given by the CCI merit any consideration
by this Hon'ble Court, as no such reasons were given in the CCI Order.
Pertinently, as stated above, the AIOVA Order does not even find a mention in the
CCI Order, leave alone any reasons for not following the same. Additionally, one
of the reasons given by the CCI for not following AIOVA Order is that e-
commerce market is an evolving market. It is submitted that the CCI has failed to
35
state facts in support of these submissions. Additionally, the CCI has also failed to
provide factual details in its submissions before this Hon'ble Court, justifying a
complete deviation from AIOVA Order. 3.52. It has been contended that the notion
of "preferred sellers" is the cornerstone of the entire edifice on which the CCI
Order is based. The CCI alleges preferential treatment and listing for preferred
sellers, deep discounting to preferred sellers, and exclusive launches through
preferred sellers. Therefore, in the absence of any evidence of preferred sellers for
a prima facie analysis under Section 26(1) of the Act, the CCI Order cannot be
sustained. In any event, allegations of preferential treatment, or discrimination in
favour of certain sellers, can only be examined under Section 4 of the Act, and
would only violate the Act, if the enterprise in question was dominant, which the
CCI has explicitly rejected in this case.
In respect of the issue regarding deep discounting it has been

contended that the CCI Order directing an investigation appears to have accepted
the allegation of the Informant that the appellant indulges in deep discounting.
However, the CCI Order fails to appreciate that discounts are legal under the Act,
and "deep" is merely an adjective. In fact, there is no statutory meaning to the
term "deep discounting". It has been further contended that low prices are good,
and are in fact a goal of competition law - low prices means efficiencies are being
generated and passed on to customers. Without prejudice, discounts can be
claimed to be of some issue when (a) they lead to prices below cost, (b) they are
provided by a dominant enterprise, and (c) they are provided with a view to
eliminate competition. The CCI order contains no findings on these three aspects.
It is stated that the investigating discounts that do not meet the standard of
predatory pricing in Section 4 of the Act (which has the elements set out in the
paragraph above. above) is a classic case of over-reach by the CCI. It is submitted
that even this alleged practice would not reach to the level of an agreement. A
unilateral conduct by the parties can be examined only under Section 4 of the Act
and not under Section 3(4) of the Act.
36
In the considered opinion of this Court, an expert body cannot be
crippled or hamstrung in their efforts by application of technical rules of
procedure.
It is also contended by the learned Senior counsel appearing for the

appellants that the harm is going to be caused to the business reputation of the
appellants and before passing an order under Section 26(1) of the Act of 2002, the
appellants should have been invited for a discussion.
In Cadila Healthcare's case (supra), the Hon'ble Supreme Court in

paragraph 44 has held as under; Cadila's reliance on Rohtas Industries and Barium
Chemicals is, in the opinion of this court, irrelevant given the facts of this case.
Granted, administrative orders should be reasoned; however, where they trigger
investigative processes that are not conclusive, having regard to the clear
enunciation in SAIL, that notice is inessential, accepting the argument, that
inquiry would harm the market or commercial reputation of a concern, would be
glossing over the law in SAIL. Moreover, the Rohtas Industries related to the
affairs of a company, which implicated its internal management. Allowing inquiry,
even an innocuous one, without application of mind, is a different proposition
altogether from acting on the information of someone who alleges either direct or
indirect or tacit dominance in the market place in the course of one's business. The
latter is regulatory of the marketplace rather than the core management of the
concern; it is akin to adjudicating a tax or commercial dispute, or a regulatory
dispute. As stated by Justice Brennan, natural justice in such instances should not
―unlock the gate which shuts the court out of review on the merits." (in this case,
preclude or chill the exercise of jurisdiction by the DG into a potential abuse of
dominant position of a commercial entity). Therefore, this court finds no merit in
the argument that the procedure adopted by the DG in going ahead with the
inquiry and investigating into the market behaviour of Cadila in anyway affects it
so prejudicially as to tarnish its reputation. The CCI has not as yet examined the
investigation report in the light of Cadila's contentions; all rights available to it, to
argue on the merits are open." In light of the aforesaid, it can be safely gathered
37
that by no stretch of imagination the order passed by the CCI under Section 26(1)
is going to cause harm to the business reputation of the appellants.
In the light of the aforesaid, in the considered opinion of this Court,

by no stretch of imagination, the process of enquiry can be crushed at this stage.
In case, the appellants are not at all involved in violation of any statutory
provisions of Act of 2002, they should not feel shy in facing an enquiry. On the
contrary, they should welcome such an enquiry by the CCI. The writ petitions
filed against the order dated 13.1.2021 and the present writ appeals are nothing
but an attempt to ensure that the action initiated by the CCI under the Act of 2002
does not attain finality and the same is impermissible in law as the Act of 2002
itself provides the entire mechanism of holding an enquiry, granting an
opportunity of hearing, passing of a final order as well as appeal against the order
passed by the CCI. In the considered opinion of this Court, the present writ
appeals filed by the appellants are devoid of merits and substance, hence, deserve
to be dismissed and are accordingly, dismissed.
Case 2: Sun Pharma Laboratories Ltd vs Finecure Pharmaceuticals Ltd &

Ors.: by Delhi High Court on 16 August, 2023
The plaintiff claims to be the largest pharmaceutical company in

India in 11 specialties, and the fourth largest Generic Pharmaceutical Company in
the world, with a global turnover of₹ 33,139 crores. Markets pantoprazole, a well-
known anti-acidity drug, under the brand name PANTOCID, in various variants,
stand alone as well as in combination with other drugs. Where pantoprazole is to
be found in combination with other drugs, appropriate suffixes attach to
PANTOCID, such as PANTOCID-DSR, PANTOCID-L, and the like. The plaintiff
holds registrations for the marks PANTOCID, PANTOCID-DSR, PANTOCID-IV
and PANTOCID-L, under the Trade Marks Act, 1999, w.e.f. 19 February 1998, 30
August 2020, 8 September 2020 and 1 May 2020, respectively. Sales of the
PANTOCID range of drugs have resulted in earnings to the plaintiff, during the
years 2020-2021 and 2021-2022, of ₹ 386.8 c rores and ₹ 513.63 crores. Para 11
38
of the plaint asserts that "the trademark PANTOCID was coined by the plaintiff's
predecessor in the year 1998 and has been in use since the year 1999."
The plaintiff has asserted, and succeeded in defending, its

PANTOCID trademark from infringement in several proceedings. 18 such orders
have been placed on record with the present plaint. However, save and except for
one order, they are all orders passed at the ex parte ad interim stage, without
contest from the defendants against whom the orders came to be passed.
The plaintiff alleges that the defendants' mark PANTOPACID is

merely a convenient corruption of the plaintiff's mark PANTOCID and is
deceptively similar to it, the only difference being the intervening "PA" between
"PANTO" and "CID". The defendants, it is alleged, have created a deliberately
confusing mark for their product, so that an unwary customer would end up
mistaking the defendants' product for the plaintiff's. The mark PANTOPACID is
alleged to be visually, phonetically and structurally similar to PANTOCID. Thus,
alleges the plaintiff, the defendants have, by use of the mark PANTOPACID,
infringed the plaintiff's registered PANTOCID marks within the meaning
of Section 29(2)(b) 1 of the (2) A registered trade mark is infringed by a person
who, not being a registered proprietor or a person using by way of permitted use,
uses in the course of trade, a mark which because of--
Signing Date:16.08.2023 15:12:19 Trade Marks Act. The plaintiff

is, therefore, entitled to an injunction and, therefore, seeks one from this Court,
permanently restraining the defendants from using the mark PANTOPACID, or
any other variant which is deceptively similar to the plaintiff's PANTOCID marks.
The Defendants claim to have adopted the mark PANTOPACID in

2007 for pantoprazole, and to have been using it since 15 June 2007. It is claimed
that the mark PANTOPACID was never intended to be an imitation of the
plaintiff's mark PANTOCID, but was, rather, a portmanteau of "PANTO", "P" and
"ACID", with "PANTO" referring to the Active Pharmaceutical Ingredient (API)
of the drug, pantoprazole, "P" indicating that the drug was a Proton Pump
39
Inhibitor (PPI), thereby reflecting its mode of action and "ACID" indicating that
the drug treated acidity. It is acknowledged, in the written statement, that
Defendant 3 had applied for registration of its PANTOPACID mark, under
the Trade Marks Act, on 13 April 2009, claiming user since 15 June 2007, in Class
5 of the Nice Classification applicable to trade marks, but that, owing to notice of
opposition filed by the plaintiff on 20 October 2010 opposing the application, to
which the Defendant 3 filed its counter statement on 30
its identity with the registered trade mark and the similarity of the
goods or services covered by such registered trade mark; or its similarity to the
registered trade mark and the identity or similarity of the goods or services
covered by such registered trade mark; or its identity with the registered trade
mark and the identity of the goods or services covered by such registered trade
mark, is likely to cause confusion on the part of the public, or which is likely to
have an association with the registered trade mark.
The written statement contests the case sought to be set up in the

plaint on various fronts. It is first alleged that the plaint suffers from delay, latches
and acquiescence. The defendants have been using the impugned mark since 2007.
Notice of Opposition opposing Defendant 3's application seeking registration of
the mark was filed by the plaintiff in October 2010. The plaintiff has, thereafter,
waited for 13 years before approaching this Court in 2023. The delay in
approaching the Court is so inordinate, alleges the written statement, that the
plaintiff stands, thereby, disentitled to any injunctive relief.
The written statement further disputes the plaintiff's entitlement to

claim monopoly over the earlier "PANTO" of the PANTOCID mark, as it is part
of the INN/IUPAC name of the API in the product, namely pantoprazole. Trade
mark monopoly, it is contended, cannot be claimed by a trade mark which merely
replicates, or abbreviates, the name of the concerned pharmaceutical ingredient.
The highest that the plaintiff could seek to urge, by way of infringement would,
therefore, according to the written statement, be with respect to the suffix "OCID".
40
Such a claim, though hit by Section 172 of the Trade Marks Act, would
additionally be unsustainable as "OCID" already stands registered as a trademark
in favour of Zydus Healthcare Ltd ("Zydus", hereinafter). The plaintiff could not,
therefore, claim to have coined even the latter "OCID" part of its mark
PANTOCID.
Besides, contends the written statement, "PANTO" is used as a

prefix in as many as 371 registered trademarks for pharmaceutical preparations.
The written statement enlists the said marks and also provides photographs of
actual packs containing the drugs in several such cases.
Pantoprazole, points out the written statement, is a Schedule H

drug3 , and can be dispensed only on the prescription of a registered medical
practitioner. Registered medical practitioners are supposed to know their job and
would, therefore, be able to distinguish between PANTOCID and PANTOPACID.
There is, therefore, little chance of confusion. Besides, there is a vide variance in
the price at which the plaintiff and the defendants dispense their products, with
PANTOPACID being much more modestly priced as compared to PANTOCID.
The defendants further allege, in the written statement, that the

plaint is liable to be thrown out as vitiated by concealment, suppression and the
statement. There is conspicuous concealment, in the plaint, of the fact that, after
Defendant 3 had applied for registration of its PANTOPACID mark in 2009, the
plaintiff had, on 16 September 2010, addressed a legal notice to the Defendant 3
to withdraw its application. This fact, it is submitted, is studiedly suppressed and,
instead, it is sought to be averred that the plaintiff came to know of the defendants'
PANTOPACID only in the third week of April 2023, thereby claiming that the
cause of action, for enlisted in Schedule H to the Drugs and Cosmetics Act,
____ Signing Date:16.08.2023 15:12:19 instituting the suit, arose on that date. On
the defendants pointing out this fact in Court on 8 May 2023, the plaintiff sought
to place, on record, the legal notice dated 16 September 2010, by way of an
application filed on 12 May 2023, in which it was sought to be averred that the
41
legal notice had, by inadvertence, not been filed. Even then, submit the
defendants, the plaintiff misstated facts, by alleging that Defendant 3 had failed to
respond to the legal notice, which was also untrue.
Equally untrue, alleges the written statement, is the averment, in

the plaint, that PANTOPACID did not figure in any medical journals. It is asserted
that, in several journals, since 2007, PANTOCID and PANTOPACID have shared
space.
On the aspect of misstatement, the written statement further alleges

that, in order to support its claim of user of the PANTOCID mark since 1999, the
plaintiff has relied on invoices which are, ex facie, fabricated and unworthy of
reliance. It is pointed out that, in all invoices covering the period till 2010, the
consignee/buyer is one Aditya Medisales Ltd. (Hereinafter, Aditya Medisales)
who, in each invoice, shares address, and building space, with the plaintiff,
irrespective of whether the invoice is issued in Kolkata, Chennai, Bhopal or
anywhere else. Yet, transportation of the goods covered by the invoices issued, in
the invoices, have been effected "by road". Such invoices, it is asserted, cannot be
trusted or believed. In fact, these transactions also constituted the basis of a SEBI4
investigation, Securities Exchange Board of India Signing Date:16.08.2023
15:12:19 against the plaintiff, which the plaintiff had ultimately to settle on a
payment of approximately ₹ 3 crores.
Yet another ground on which the invoices placed on record by the

plaintiff have been sought to be discredited by the defendants is that, in several of
them, issued prior to 2005, there is a reference to Value Added Tax (VAT), though
VAT was introduced in India only in 2005, and a TIN 5 , required for payment of
VAT, was issued to the plaintiff only on 1 April 2006.
Thus, contends the written statement, the plaintiff's case has no legs
to stand on, and, to say the least, no injunctive interlocutory relief can be granted
to the plaintiff.
42
The plaintiff filed, with the suit, the present application IA
8800/2023, under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure,
1908 (CPC), seeking interlocutory injunctive reliefs. Pleadings in the IA have
been completed, and this judgment proceeds to dispose of the IA.
The IA, and the reply by the defendants thereto, basically replicate
the plaint and the written statement. Though there is no formal replication filed in
the suit as yet, the plaintiff has filed a detailed rejoinder to the defendants' reply to
the present application, Taxpayer Identification Number Signing Date:16.08.2023
15:12:19 in which the allegations contained in the reply have been sought to be
traversed.
The application for registration of PANTOCID, filed by Takeda, it

is submitted, is entirely irrelevant to the dispute. Takeda's application was filed on
"proposed to be used" basis, and Takeda never actually used the mark
PANTOCID. Besides, even after the mark was granted in favour of Takeda, the
grant was cancelled on the plaintiff's rectification application. As on date,
therefore, the plaintiff is the sole registered user of the mark PANTOCID, with
registration effective from 1998. In any event, submits the plaintiff, the defendants
cannot seek to carry Takeda's brief, and the aggrieved party, if any, would be
Takeda, not the defendant. So long as the plaintiff is able to demonstrate a
superior right to the mark PANTOCID via-a-vis the defendants, the plaintiff is
entitled to an injunction.
The registration of the mark "OCID" in favour of Zydus is, it is

submitted, totally irrelevant. The allegation that the plaintiff had, in the plaint,
misstated that the defendants' PANTOPACID was not reflected in any medical
journals, is also disputed. The journals to which the defendants refer in the written
statement are, according to the rejoinder, obscure journals, and the plaintiff could
not be expected to have knowledge thereof. The ORG IMS Research journal is,
according to the plaintiff, the most authoritative journal which reflects all new
products, and PANTOPACID finds no place therein.
43
The various examples of drugs sold under brand names starting
with "PANTO", submits the plaintiff, can make no difference, as none of the
names is deceptively similar to PANTOCID. Besides, the mere fact that, on the
Register of Trade Marks, other marks starting with "PANTO" may have been
registered, cannot make out a case of the prefix "PANTO" having become
common to the trade. The plaintiff, it is submitted, cannot pursue every infringer.
The plaintiff also disputes the defendants' contention that, as pantoprazole is a
Schedule H drug, there is no chance of confusion between PANTOCID and
PANTOPACID.
Apropos the legal notice dated 16 September 2010, the plaintiff

submits that it was not filed with the plaint owing to oversight. Nonetheless, the
plaint has disclosed that Defendant 3 had applied for registration of
PANTOPACID as a device mark on 13 April 2009 in Class 5, claiming user since
15 June 2007. The plaintiff had also placed on record the counter statement of
Defendant 3, in response to the opposition of the plaintiff to the defendants'
PANTOPACID mark, as well as the affidavit-in-evidence filed by the plaintiff in
support of its opposition, which refers to the legal notice dated 16 September
2010. The allegation of concealment and suppression of fact is, therefore,
seriously disputed by the plaintiff.
The plaintiff further submits that it cannot be said to have

acquiesced in the use, by the defendant, of PANTOPACID, as the plaintiff
opposed the application of Defendant 3, seeking registration of the said mark, at
the first available opportunity. Thereafter, if the defendants continued to use the
mark, they did so at their own peril, and no equities could result in favour of the
defendants as a result of such use.
The defendants' plea that the prefix "PANTO" is common to the

trade is, it is submitted, misguided, as such a plea cannot be raised merely by
referring to various registered marks which start with "PANTO". Besides, the
plaintiff could not be expected to pursue every infringer.
44
Consequent to directions issued by this Court on 5 July 2023, the
defendants filed an affidavit, dated 15 July 2023, explaining the peculiar feature,
noted in para 14 supra, of all invoices till 2010 having been issued to Aditya
Medisales, which shared the same address as the plaintiff, irrespective of the town,
or city, where the plaintiff was located. It is stated, inter alia, in the said affidavit,
that Aditya Medisales is an independent company, incorporated on 16 October
1990, with a registered office in Vadodara and administrative office at Vile Parle,
Mumbai. It has been filing independent tax returns, and is registered with the
Sales Tax and VAT authorities in 25 states in India. Its returns have also been
assessed under Section 143(3) of the Income Tax Act, 1961. It has its own Board
of Directors, staff and financial resources. Its accounts are audited by independent
statutory auditors. It has its independent TAN 6, and has been deducting TDS on
payments made by it, which is duly credited to the Government account. The
location of Aditya Medisales adjacent to the supplier - in this case, the plaintiff - is
only for the purposes of synergy, reduction of time, operational efficiency and cost
reduction. It is further stated that goods were purchased by Aditya Medisales from
the plaintiff and received at its various Cost and Freight (C & F) locations, from
the plaintiff's warehouses. The C & F agents sell the goods to the stockists. Sale
invoices are raised in the name of the stockists by Aditya Medisales, and
dispatches are made by Aditya Medisales through local transport, hand delivery or
by courier. The affidavit also annexes invoices issued by Aditya Medisales in
favour of the stockists.
There are further assertions in the affidavit, but they are not of
particular relevance to the controversy at hand. The defendants have not filed any
formal response to the affidavit, and Mr. Sai Deepak did not seek to traverse the
correctness of the facts stated therein, at least at this stage.
Having thus set out the rival stands, as they emanate from the
pleadings in writing filed before this Court, I proceed to allude to the rival
submissions made at the bar by learned Counsel. The plaintiff Tax Deduction and
Collection Account Number Signing Date:16.08.2023 15:12:19 was represented
45
by Mr. S. Ganesh and Mr. Rajshekhar Rao, learned Senior Counsel and Mr. Sachin
Gupta, learned Counsel and the defendants were represented, as already noted, by
Mr. Sai Deepak.
Submissions made at the Bar Plaintiff's submissions Opening

arguments by Mr. Sachin Gupta Having broadly reiterated the averments in the
plaint, Mr. Sachin Gupta points out that, while PANTOCID was registered in
favour of the plaintiff w.e.f. 19 February 1998, and was used by the plaintiff w.e.f.
1999, in support of which several invoices had been placed on record with the
plaint, the Defendant 3 applied for registration of the impugned PANTOPACID
mark only in 2009, claiming user since June 2007. The application was opposed
by the plaintiff, and, owing to failure on the part of the Defendant 3 to prosecute
the application, stands deemed abandoned under Rule 51 7 of the Trade Marks
Rules, 2002.
Besides reiterating the submissions advanced in the written

statement, Mr. Sai Deepak submits that the plaintiff has not approached the Court
with clean hands and is, therefore, ex facie disentitled to any relief, especially as
this is a commercial suit. There is complete suppression of the proceedings
relating to Takeda and the fact that, prior to the plaintiff, Takeda had already
applied for registration of PANTOCID and was, in fact, holding a valid
registration for PANTOCID on the date when the plaintiff was granted registration
for the same mark. In this context, Mr. Sai Deepak submits that the plaintiff's
assertion, in para 11 of the plaint, that the mark PANTOCID was coined by the
plaintiff is obviously false, as the mark was, prior to the plaintiff, devised by
Takeda.
Mr. Sai Deepak submits that, therefore, vis-à-vis Takeda, the

plaintiff is itself an infringer of the mark PANTOCID. An infringer, he submits,
cannot sue for infringement.
Additionally, Mr. Sai Deepak emphasises the highly suspect nature

of the invoices placed on record by the plaintiff. He submits that, prior to 2011, all
46
invoices reflect sales to Aditya Medisales, which are inherently suspicious
transactions. The plaint is completely silent as to how, in every town and in every
city, Aditya Medisales was located at the same address as the plaintiff. Mr. Sai
Deepak also takes serious exception to the reference to VAT, in invoices
issued prior to introduction of the VAT in India. Developing on this argument, Mr.
Sai Deepak also questions the plaintiff's claim to priority of user vis-à-vis the
defendants, as the defendants claim - and have also established - user, by them, of
the PANTOPACID mark from December 2007, and, prior to that date, every
invoice that the plaintiff has placed on record reflects sales to Aditya Medisales.
There is no invoice reflecting a sale to an independent third party, placed on
record by the plaintiff, indicating use of PANTOCID as a mark prior to December
2007. The position that emerges is, therefore, that (i) PANTOCID stands
registered in the plaintiff's favour w.e.f. 1998, (ii) the defendants claim user of
PANTOPACID as a mark from June 2007, and have placed, on record, invoices
reflecting such user at least from December 2007 and (iii) if the invoices filed by
the plaintiff reflecting sales to Aditya Medisales are to be ignored, the earliest user
of PANTOCID by the plaintiff, for which evidence is available, is of 2011.
PANTOPACID and PANTOCID have, he submits, being co- existing even on the
pages of drug journals since 2007 and, at this stage of time, the balance of
convenience would certainly not be in favour of interdicting further use, by the
defendant, of the mark PANTOPACID. Besides, the two marks having coexisted
for 16 years as on date, it could not be alleged that the use, by the defendant, of
PANTOPACID, was likely to create confusion in the market.
The plaintiff has also suppressed the legal notice dated 16

September 2010 addressed by the plaintiff to the defendants and has falsely stated,
in para 32 of the plaint which deals with the arising of the cause of action, that the
cause of action for filing the suit arose, in the plaintiff's favour, "in the third week
of April 2023 when the Plaintiff came across the Defendant's medicine under the
mark PANTOPACID SR being sold at Delhi and on third party ecommerce
interactive website". On this aspect being brought to the attention of the plaintiff
47
during the course of arguments before this Court, the plaintiff, in its rejoinder to
the reply filed by the defendants to the present application, sought to underplay
the issue by merely averring that the letter dated 16 September 2010
"inadvertently could not be placed on record due to oversight".
Mr. Sai Deepak also reiterates the contention that the "PANTO"
prefix is common to the trade and, in this context, has invited the attention of the
Court to the search report generated from the website of the Trade Mark Registry,
which indicates a large number of marks, for pharmaceutical preparations, which
start with "PANTO". He also points out that, in the written statement, he has
specifically adverted to physical sales of several such products in the market, so
that the contention of the plaintiff that the mere presence of similar marks on the
Register of Trade Marks does not make out a case of the mark being common to
the trade, cannot hold water. For the same reason, he submits that the ratio of the
decision of the Division Bench of this Court in Pankaj Goel v. Dabur India Ltd. 8
would also not apply.
This Order, submits Mr. Ganesh, has never been challenged and
has attained finality. Thus, PANTOCID having been registered in favour of the
plaintiff by the Registrar after due application of mind, and no statutory
procedure, whereunder the registration would be sought to be unseated having
been invoked by the defendants till date, Mr. Ganesh submits that PANTOCID, as
the plaintiffs registered trademark, is entitled to the presumption of validity
conferred by Section 31(1) of the Trade Marks Act.
Apropos Mr. Sai Deepak's submission that, prior to 2011, none of

the invoices filed by the plaintiff were truly reliable, as sales, in the said invoices,
were to Aditya Medisales, Mr. Ganesh submits that, in most of the invoices filed
by the defendants, too, sales were effected to its own distributor. He further points
out that none of the said invoices reflect sales in Delhi, so that the plaintiff's
submission that it came to know of the use of the PANTOPACID mark by the
defendants only in 2023 could not be disbelieved. In this context, Mr. Ganesh has
48
drawn attention to the fact that, even in the legal notice dated 16 September 2010,
addressed by the plaintiff to the defendants, (4) Subject to the provisions of this
Act, the Registrar may refuse the application or may accept it absolutely or subject
to such amendments, modifications, conditions or limitations, if any, as he may
think fit.
It was specifically stated that the plaintiff had not noticed use, by
the defendants, of the PANTOPACID mark, as it was not appearing in any of the
relevant trade journals. It was for that reason, among others, that the plaintiff
requested the defendants to withdraw their application for registration of
PANTOPACID, from the Trade Marks Registry. The defendants, in their reply
email sent on 4 October 2010, sought guidance on how to proceed in the matter
and also sought to know the identity of the journal to which the plaintiff had
referred to allege that the defendants' user date was not justified. On the same
date, he points out, the plaintiff responded to the defendants, calling on the
defendants to produce cogent material justifying their user claim and reiterating its
demand that the defendants withdraw their application for registration of the mark
PANTOPACID from the Trade Marks Registry, as it was conflicting with the
plaintiff's registered PANTOCID mark. The defendants were also called upon to
immediately cease and desist further use of the mark PANTOPACID. In these
circumstances, Mr. Ganesh submits that the plaintiff could not be treated as a
silent spectator to the use, by the defendants, of the impugned PANTOPACID
mark.
Mr. Rajshekhar Rao submits that the defendants have not

challenged the validity of the registration of PANTOCID in favour of the plaintiff
in their written statement and that, therefore, the submissions of Mr. Sai Deepak
are being made 17 years too late. Apropos the doubts that Mr. Sai Deepak seeks to
cast on the plaintiff's documents, Mr. Rajshekhar Rao refers to the affidavit filed
by way of response in that regard and also relies on para 22 to 24 of the judgment
of the High Court of Bombay in Rahul Mahendra Patel v. F.S.K Enterprises 26.
49
Plaintiff's trade 132-140 Admitted Admitted Admitted Admitted
Admitted mark however however however however however registrations for the
the the the the the marks contents contents contents contents contents PANTOCID
must be must be must be must be must be 2016 SCC OnLine Bom 6646 Signing
Date:16.08.2023 15:12:19 DSR, compared compared compared compared
compared PANTOCID L with the with the with the with the with the and original
original original original original PANTOCID IV under no.
The Order dated 27 December 2010, of the Senior Examiner,

submits Mr. Sai Deepak, is obviously erroneous, as it does not even purport to
examine Section 11(4) or Section 12 of the Trade Marks Act. Insofar as Mr.
Ganesh's submission that the defendants have not, as yet, sought to challenge the
registration of PANTOCID in the plaintiff's favour, Mr. Sai Deepak submits that
the defendants have no objection to the said registration, or to the use of the mark
PANTOCID by the plaintiff, so that no occasion arose for the defendants to
challenge either the registration or the use. When, (2002) 5 SCC 90 2023 SCC
OnLine Del 896 Signing Date:16.08.2023 15:12:19 however, the plaintiff sought
to unseat the defendants' PANTOPACID mark on the basis of the said registration,
the defendants had every right to question the validity of the registration as one of
the grounds on which to oppose the plaint.
Mr. Sai Deepak further submits that, though, in the written

statement, as well as in the reply to the present application, the defendants have
specifically questioned the validity of the registration of PANTOCID in the
plaintiff's favour, there is no response, thereto, in the rejoinder filed by the
plaintiff.
Apropos Coolways23 and Cadila24, Mr. Sai Deepak submits that

neither of the said decisions dealt with a situation in which the plaintiff had
approached the Court after an inordinate delay. Especially in Coolways23, Mr. Sai
Deepak points out, from para-1 of the decision, that the defendant was using the
impugned mark only since 1992, which was the year when the suit was instituted
50
by the plaintiff. Neither of these decisions, therefore, in his submission, can be of
help to the plaintiff.
Balance of convenience: Given the above facts and findings, and

keeping in mind the fact that the plaintiff has, despite being aware of the use, by
the defendants, of the impugned PANTOPACID mark since 2009, taken no steps
till 2023 to injunct such use, during which time the defendants have also grown
into a formidable market player, the balance of convenience would, in my opinion,
clearly not justify bringing the use, by the defendants, of the PANTOPACID mark
to a complete halt, at this late stage. Rather, the interests of justice would be
subserved if the defendants are directed to maintain accounts of their earnings
from use of the impugned PANTOPACID mark, and periodically submit them to
the Court, pending disposal of the suit.
Resultantly, I am of the opinion that the plaintiff has not succeeded

in establishing its entitlement to relief against the infringement, by the defendants,
of the plaintiff's PANTOCID mark, by use of the mark PANTOPACID.
The prayer for interlocutory injunction is, therefore, rejected. The

defendants are, however, directed to maintain a separate account of its earnings
and returns from use of the mark PANTOPACID. They shall also place, on
affidavit, the figures of the amounts earned, by use of the said mark, since
inception. Periodical statements, on affidavit, shall be filed by the defendants
every three months, placing on record their returns from sales of products using
the impugned PANTOPACID mark, or any of its variants.
Case 3: Amway India Enterprises Pvt. Ltd. vs 1Mg Technologies Pvt. Ltd. &
Anr. : vy Delhi High Court on 8 July, 2019
I.A. 11335/2018 (u/Order XXXIX Rules 1 and 2) in CS(OS)

410/2018 CS(OS) 453/2018 and I.A. 12419/18 (for stay) and 14613/18 (u/O
VII Rule 11 CPC) I.A.13159/2018 (u/Order XXXIX Rules 1 and 2) in CS(OS)
480/2018 I.A.14402/2018 (u/Order XXXIX Rules 1 and 2) in CS(OS) 531/2018
51
I.A. 14858/2018 (u/Order XXXIX Rules 1 and 2) in CS(OS) 550/2018
I.A.1733/2019 (u/Order XXXIX Rules 1 and 2) in CS(OS) 75/2019
I.A.2238/2019 (u/Order XXXIX Rules 1 and 2) in CS(OS) 91/2019 S.No.
Contents Para No. A. INTRODUCTION 1-3 B. CASE OF THE PLAINTIFFS B1.
By M/s Amway India Enterprises Pvt. Ltd. in 4 - 21 CS(OS) 410/2018, CS(OS)
453/2018, CS(OS) 480/2018, CS(OS) 531/2018 and CS(OS) B2. By Modicare
Ltd. in CS(OS) 75/2019 22 - 32 B3. By Oriflame India Pvt. Ltd. in CS(OS)
91/2019 33 - 42 C. CASE OF THE DEFENDANTS C1. By Amazon Seller
Services Pvt. Ltd. in CS(OS) 43 - 61 480/2018, CS(OS)75/2019 and CS(OS)
91/2019 C2. By 1MG Technologies Pvt. Ltd. in CS(OS) 62 - 63 410/2018, and by
Bright Lifecare Pvt. Ltd. in CS(OS)550/2018 C3. By Flipkart Internet Pvt. Ltd. in
CS(OS) 64 - 66 C4. By Jasper Infotech Pvt. Ltd. in CS(OS) 550/2018 67 - 72 C5.
By other sellers 73 - 76 REPORTS E. SUBMISSIONS BY COUNSELS 78 - 79
E1. Submissions of the Plaintiffs 80 - 114 E2. Submissions of the Defendants 115
- 138 E3. Stand of the Union of India 139 - 141 F1. Question (i) - Whether the
Direct Selling 143 - 174 Guidelines, 2016 are valid and binding on the Defendants
and if so, to what extent?
F2. Question No. (ii) - Whether the sale of the 175- 287 Plaintiffs‟
products on e-commerce platforms violates the Plaintiffs‟ trademark rights or
constitutes misrepresentation, passing off and results in dilution and tarnishes the
goodwill and reputation of the Plaintiffs‟ brand?
F3. Question (iii) - Whether the e-commerce 288 - 305 platforms

are "intermediaries" and are entitled to the protection of the safe harbour provision
under Section 79 of the Information Technology Act and the Intermediary
Guidelines of 2011?
F4. Question (iv) - Whether e-commerce platforms 306 - 318 such

as Amazon, Snapdeal, Flipkart, 1MG, and Healthkart are guilty of tortious
interference with the contractual relationship of the Plaintiffs with their
distributors/direct sellers?
52
The old adage, which translates to ―with great power comes great
responsibility‖, popularised by a famous movie based on a comic book series, in
modern day world would be applicable to e-commerce platforms, which have
penetrated all forms of trade, commerce and businesses. The contribution of e-
commerce in providing accessible global platforms for traders, craftsmen,
traditional artists, home designers, housewives etc., along with the credit for
creation of large infrastructural facilities such as warehouses, transportation, etc.,
as also employment for thousands of people, is well acknowledged. However,
there are certain safeguards that need to be followed so as to ensure that existing
businesses and trades are not adversely impacted by the growth of e-commerce,
without requisite checks in place. The present cases highlight the conflict that can
arise between one such existing form of business/trade viz., Direct Selling
Businesses and e-commerce platforms. The legal complexities in this conflict
involve Constitutional issues, intellectual property rights, information technology
laws, consumer protection laws, contractual laws, law of torts, and other
applicable guidelines.
As per the Guidelines, it is mandatory for the Direct Selling Entity

to provide a full refund or buyback guarantee on reasonable commercial terms, to
its direct seller within 30 days. Direct Selling Entities, such as Amway, have to be
the owners of the trademark or a service mark and their members are bound to
strictly comply with the Guidelines. The Direct Selling Entity is expected to also
enter into a specific agreement with the Direct Sellers, before enrolling them as
part of the distribution network. Specific provisions are contained in the
Guidelines for the conduct of the said business in consumer interest. One of the
clauses of the Guidelines i.e., clause 7(6) requires that the sale of the products of
the Direct Selling Entity on any e- commerce platform or marketplace would have
to be done by ―any person‖ only with prior consent of the Direct Selling Entity.
Thus, according to Amway, any sale of its products except in

compliance with the Guidelines would be contrary to law. The grievance of
Amway in the present cases is that various e-commerce platforms, who have been
53
arrayed as parties in the present suit, are enabling sale of Amway branded
products through their platforms, without their consent. The sellers/re-sellers on
the said portals are also arrayed as Defendants in the present suit.
That Amway, acquired knowledge of sale of Amway branded

products and various e-commerce platforms and found that various Amway
branded products were being advertised, offered for sale and sold on the said
platforms without Amway‟s consent. This, according to Amway, was in violation
of the Guidelines. Amway‟s products were being sold at much cheaper prices than
the market price, which according to Amway resulted in huge financial losses to it
also direct sellers. Considering the manner, in which the products were being sold
at such cheap prices, Amway also apprehended that the goods may not be genuine
and may in fact be counterfeit/tampered Amway products.
Thus, Amway called upon all the e-commerce websites to remove

any reference to Amway on their websites including advertising Amway products
and cease and desist from displaying any of Amway‟s products on the said
portals. The said notice was also marked to various governmental authorities and
Federation of Indian Chambers of Commerce and Industry (FICCI).
Since there was no effective redressal of its disputes Amway has

filed the present suits. In addition to the reliance on the Direct Selling Guidelines,
Amway, in its plaint, avers that the sale of its products, through such unauthorised
channels such as e-commerce websites, is without its consent, and that it does not
guarantee the authenticity and quality of such products. Further, tampering with
and removal of the unique codes from the products, would also result in loss of
reputation for Amway, and will affect its relationship with its Direct Seller, as also
the consumers. It is stated that Amway products are being sold on Defendants‟ e-
commerce platforms on a non-returnable basis, which is in stark contrast with the
return policy of Amway, and this would lead to dilution of goodwill and reputation
of Amway amongst its customers. Amway also alleges passing off by the
Defendants as they seek to cash in on the goodwill, and reputation acquired by
54
Amway, by either showing Amway as a ‗featured product' on its website, or
showing Amway products in advertisements of the e-commerce websites. Further,
sale of Amway products at a rate cheaper than the market price brings into
question the genuineness of the products being sold through such e-commerce
platforms. Sale of low-quality Amway products is not only life threatening, but
causes immense loss of goodwill to Amway. For all of the above reasons, the
brand value of Amway is being diluted and eclipsed. Sale of Amway products in
such an uncontrolled manner thus, exposes Amway to the risk of losing its license
to conduct its business in India as a Direct Selling Entity.
Amway further alleges that the conditions for refund and return are
also completely different, and in any event, partially used products are not
returnable. However, in the case of Amway, 30% partially used products are
returnable and entitled to full refund. The e-commerce portals describe the
products with the name Amway along with image - in a manner so as to convey to
the consumer that they are being sold by Amway. For example, the use of the
expression ―by Amway‖ appearing under the image of the product on the
Amazon platform, gives an impression to the consumer that Amway is itself
selling the product on the Amazon portal. On most of the portals, details of the
sellers i.e. name, address, contact details and whether the said sellers are
authorized distributors of Amway is not even mentioned on the website. In places
where the seller‟s name appears, the same is in a completely ambiguous manner
from which it is not possible to find out the details of the seller viz., its contact
details, address, email, phone numbers, its promoters and whether the seller is
authorised or not. It is further averred that there are various levels of services
provided by the e-commerce websites, wherein various additional services and
add on features are provided by them. For example, `Fulfilled by Amazon' and
`Flipkart Plus' category of products, wherein the portals also provide various
additional services such as, warehousing, transportation, packaging, dispatch,
customer services, etc to the seller. All the seller needs to do is provide the product
to the portal. The manner in which Amway products are being sold at such low
55
prices also raises apprehension that counterfeit products may be sold by
unscrupulous traders on e-commerce websites, which would be contrary to the
public and consumer interest. It is thus pleaded that the sellers and the platforms
are taking unfair advantage of the Amway brand name.
Amway, relying on the ‗Excluded Products' List', ‗Banned

Products' List' and ‗Terms of Use', of the various e-commerce platforms, submits
that as per their own policies, products being sold by a person not authorised by
the trademark owner to sell the same, cannot be listed for sale. If a person is not
an authorized re-seller, as designated by the manufacturer of the products or the
distributor, the said product is excluded from being sold the said platforms.
Further, if the seller has placed the product on the market without the consent of
the trademark owner, then such products are also excluded. Amway, thus, relies on
these clauses to submit that the distributors/sellers, who are not authorised by
Amway, cannot be allowed to sell Amway branded products on e-commerce
platforms. Amway also pleads that it has also received negative feedback from its
customers, who have purchased from the Defendants, and have also complained
that the products are duplicate/counterfeit in nature.
It is further pleaded that Amway representatives purchased various

products from the Defendants, and it was noticed that the unique code was also
erased/removed so as to make it difficult to track the ABO, if any, from whom the
product may have been purchased. This further gave rise to an apprehension that
the products are being tampered with by the sellers. According to Amway, none of
the sellers, selling Amway branded products on e-commerce websites, are
authorised or have any consent to sell Amway products online. It is, thus, claimed
that the manner in which Amway branded products are being sold on e-commerce
platforms, clearly, shows that there is tortious interference with the Plaintiffs‟
contracts i.e. the Direct Selling Agreement and Code of Ethics, and that there is
tampering of the products due to the removal of the unique code. The reputation
of the products is being tarnished and interfered with, considering the large
variance in the refund/return policy as also the warranty for the products. The
56
reputation of Amway is also being affected due to change in prices of good, and
brings the authenticity of the goods into question. Further, due to
tampering/removal of the unique codes of Amway, even if the products were
genuine, the Defendants do not qualify to claim the defence of Section 30 of the
Trade Marks Act, 1999.
It is, further, stated that the sale of Amway products on an e-

commerce platform and the mobile application is contrary to the approval dated,
4th August, 2004, granted by Government of India in favour of Amway, as also
the undertaking submitted by Amway to the Government vide its letter dated 8th
December, 2016. Thus, the sale of Amway products on e-commerce platforms is
not merely violative of the Plaintiffs‟ rights, but also has the risk of exposing
Amway to action by the Government for being in violation of its undertakings
given to the Government of India, for being allowed to undertake direct selling
business activities.
In the replication filed by Amway to Cloudtail‟s Written statement,

it is averred that Cloudtail is an affiliate/associate of Amazon, and that it is a 49-
51% joint venture of the Amazon group with M/s Catamaran Ventures through a
joint venture company called M/s. Prione Business Services Pvt. Ltd. The
documents to support this averment have been filed on record.
Modicare is in the direct selling business and sells products related

to varied fields such as health, nutrition, skin care, cosmetics, personal care, home
care, food, beverage, etc. Modicare offers its products direct to consumers through
its direct sellers, called Modicare Consultants, who have a binding contract with
Modicare, through the Consultant Application Form, as well as the Modicare‟s
Business/Code of Ethics. Modicare‟s Code of Ethics prohibits its Consultants to
sell Modicare products through alternative methods of sale i.e., retail or online
sales. For Modicare Consultants, there is no joining fee, no sales pressure and no
requirement to maintain minimum inventory of products with them. In addition,
on the basis of the sales by each Consultant, various incentives are offered to
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Consultants. Regular seminars and training workshops are held by Modicare for
its Consultants.
It is submitted by Modicare that since inception, it has grown

exponentially and has a Pan-India presence, catering to over 2700 cities in the
country. It has over 100 products being sold by 1,00,000 active direct sellers. It
also submits that its products are not available for sale legitimately through e-
commerce or online portals or mobile apps. Further, Modicare offers a Customer
Satisfaction Program which gives an irreversible 100% satisfaction or moneyback
guarantee to its consumers. Such guarantee is applicable even if partially used
products are returned to Modicare.
That sometime in June, 2016, Modicare found that several of its

products were being offered for sale and sold on Amazon‟s platform, without its
consent. It is the case of Modicare that the said sale was being facilitated by
Amazon through its Fulfilled by Amazon service. Since no seller details were
available on Amazon, Modicare claims that to the best of its knowledge,
Defendant Nos.2 and 3 were not its Consultants. Modicare then addressed an
email to Amazon dated 5th October, 2016, pointing out the rampant sale of
Modicare products on Amazon, without the consent of Modicare and that Amazon
is not authorised to sell Modicare products on its platform. In response, Amazon
simply redirected the representative of Modicare to file specific complaints qua
each impugned product through its complaints‟ portal. Thereafter, the
representative of Modicare requested to speak to a higher official to address its
issue. On 13 th January, 2017, Amazon responded to the email dated 5th October,
2016, and took the stand that it was only an intermediary, entitled to protection
under Section 79 of the IT Act. It also claimed that it was not a party to any
transaction on the said marketplace and it also does not control any transaction
occurring on the said portal.
Modicare then filed the present suit against Amazon, pleading that
the unauthorised sale of Modicare products on Amazon is impermissible, illegal,
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and unauthorised. The grounds taken by Modicare are similar to the grounds
raised by Amway. Modicare also pleaded misrepresentation, change of
warranties/guarantees, and return policies. It also pleaded that the customers of
Modicare are also likely to get confused as to the source of the products being
sold on Amazon, believing that the sale so being conducted has been consented to
by Modicare, however, Modicare would not legitimately be able to answer them
as to why the benefits of the Customer Satisfaction Program are not available to
them.
It is submitted that there have been many customer comments on

Amazon platform, showing dissatisfaction with Modicare products, and bringing
into question the genuineness of the same. This severely impairs the goodwill that
Modicare has been able to create and will cause irreparable loss to it.
Modicare, further avers that Amazon lists more than 700 products
bearing the mark Modicare. This renders it impossible for Modicare to verify and
ensure the authenticity of each and every product being sold. Further, the products
are being sold on Amazon at hefty discounts, resulting in the declining sales of
Modicare products, through its direct selling network. The sale of the products, at
such low prices, according to Modicare, also raises a doubt as to the genuineness
of the said products. Sale of counterfeit products being made available through
Amazon, with no way of verifying the identity of the seller, could pose a huge risk
to health and safety of its consumers as well, which in turn would cause damage to
the reputation of Modicare. Thus, by concealing the contact details of the sellers,
Amazon is facilitating rampant counterfeiting of the goods of Modicare, and
inducing sellers to illegally sell Modicare products. This amounts to tortious
inducement of breach of contract by Amazon, causing Modicare Consultants to
breach their contracts with Modicare. Lastly, it is averred that listing of Modicare
products on Amazon is in contravention of the Legal Metrology Act and Legal
Metrology (Packaged Commodity) Rules, 2011 (as amended in 2017), as Amazon
is listing Modicare products, either without mention of MRP or with inflated
MRP. This constitutes misrepresentation and is violative of applicable laws.
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Further, Modicare claims that the large bundle of services being
offered by Amazon for use of its platform, brings it out of the ambit of being an
―intermediary‖ within the meaning of the term under the IT Act, and thus, the
safe harbour provisions under Section 79 of the IT Act are not available to
Amazon.
In view of the above, Modicare filed the present suit seeking

permanent and mandatory injunction against Amazon and various sellers on
Amazon from selling Modicare products, as also damages.
Amazon is directed to file a reply to the application under Order

XXXIX Rules 1 and 2 CPC within 10 days. Rejoinder before the next date. Both
parties are given liberty to approach the Court for any modification of this order.
Questions as to the legality and validity of Direct Selling Guidelines and their
applicability on e-commerce portals, like Amazon, would be considered after the
reply is filed.‖
Thereafter, on 12th March, 2019, a contempt application came to

be filed by Modicare, alleging violation of order dated 5th February, 2019
by Amazon, whereby it failed to provide Modicare with the seller details as was
directed by the Court in paragraph 19(iii) of order dated 5th February, 2019.
Various reminder emails were also sent to Amazon, which replied that it was a
`time consuming process'. But no application for extension of time was also filed.
Despite passage of over a month, Amazon had failed to provide the complete
sellers‟ details to Modicare, and accordingly, show cause notice was issued to
Amazon as to why contempt action should not be initiated against it. However, on
14th March, 2019, tendering an unconditional apology, Amazon provided the
seller details to Modicare and the contempt application was dismissed recording
an undertaking by Amazon that it would provide any further details of sellers as
pointed out to them by Modicare. The pleadings in the suit were completed,
thereafter, and written statement came to be filed by Amazon.
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The Plaintiff- M/s Oriflame India Pvt. Ltd. (hereinafter, ‗Oriflame')
has filed the present suit seeking permanent and mandatory injunction restraining
the Defendants from illegally selling Oriflame‟s products and for damages. The
case of Oriflame is that it is engaged in the business of manufacturing and selling
of cosmetics and wellness products through a network of its direct sellers called
Consultants, who sell the products direct to consumer. It is the case of Oriflame
that Defendant No.6 - Amazon, owner and operator of the e-commerce website
www.amazon.in, on which Defendants Nos.1-5, and others are selling Oriflame
products without authorization from Oriflame.
Oriflame over the years, has acquired immense goodwill through

its direct selling business, both in India and globally. To safeguard
consumer interest, Oriflame offers a ―Guarantee of Excellence Claims Policy‖.
As per the said policy, if a consumer is not happy with any of the products of
Oriflame, he/she may return the product within 30 days from date of invoice, for a
full refund or exchange subject to receipt of the product back by Oriflame, at the
nearest branch of Oriflame. Refund can only be claimed after production of an
invoice for the product generated by Oriflame. Oriflame relies on the letter dated
9th April, 2018 issued by FSSAI to various e-commerce entities, to state that
Amazon had due knowledge of the obligations under the Guidelines.
It is further averred that Oriflame received numerous complaints

from its consultants that Oriflame products are being sold on Amazon, at hugely
discounted rates. Accordingly, Oriflame sent a legal notice dated 5 th June, 2018,
whereby it brought to the notice of Amazon, that the products of Oriflame are to
strictly be sold strictly through direct sellers. Webpages bearing the name
Oriflame were being displayed on Amazon's platform, and Oriflame's products
were being sold on Amazon, despite the fact that Oriflame had not authorised any
of its sellers to sells on e-commerce platforms. Thus, in view of the above and the
Direct Selling Guidelines, it requested Amazon to remove and disable access to all
links wherein the sellers are selling products unauthorizedly and wrongfully using
the mark 'Oriflame'.
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Amazon, in response, vide letter dated 11th July, 2018 denied all
allegations made in Oriflame's notice. It averred that it was an intermediary and
was entitled to protection of the safe harbour provisions under the IT Act.
At the interim stage, the fact that the Guidelines have been in
operation since 2016, the same having been repeatedly notified to e- commerce
platforms, who have chosen not to challenge them and the broader
public/consumer interest behind the said Guidelines sought to be safeguarded,
persuade this Court to hold that they are binding in nature as they do not impinge
on any Fundamental Rights of either the sellers or the platforms. Moreover, the
Guidelines fully regulate the conduct of business by Direct Sellers who are bound
by them. If platforms are permitted to violate the Guidelines, the Direct Selling
Entities will be left with no remedies to enforce a binding law. The Guidelines
have been duly issued and have been authenticated by a gazette notification, as
required. It is, accordingly, held that the Direct Selling Guidelines are binding on
e- commerce platforms and the sellers on the said platforms.
The effect of the said guidelines being binding, would be, that the
sellers/platforms would have to take consent of the Direct Selling Entities to offer,
display and sell the products of Direct Selling Entities on their platforms, in
compliance with clause 7(6) of the Guidelines. F2. Question No. (ii) - Whether the
sale of the Plaintiffs' products on e-commerce platforms violates the Plaintiffs'
trademark rights or constitutes misrepresentation, passing off and results in
dilution and tarnishes the goodwill and reputation of the Plaintiffs' brand?
The Plaintiffs in each of the suits are the owners of their

respective trademarks - Amway, Modicare and Oriflame. The use of the said
marks and control over the products bearing the said marks, would exclusively
vest with the respective owners, in accordance with law. None of the Defendants
challenge the ownership rights of the Plaintiffs in the respective trademarks. The
question that, therefore, arises is as to whether the Plaintiffs can control or seek to
regulate the sale of their respective products on e-commerce platforms and
62
whether the Defendants have a right in law, as envisaged under Section 30 of the
Trade Marks Act to continue to sell the Plaintiffs‟ products.
It is a matter of common knowledge that unless there is any

prohibition in respect of sale of a product, all products can be sold through e-
commerce platforms. However, there are two exceptions - First, there should be
no prohibition in selling the same and Secondly, the condition of goods ought not
to be impaired and the goods ought not to be tampered with in any manner. The
Plaintiffs, are engaged in a unique business called Direct Selling business, under
which the Plaintiffs‟ products are distributed and marketed through a dedicated
distribution channel. All the distributors/sellers who sell the Plaintiffs‟ products
procure the same under specially executed contracts with the Plaintiffs companies.
Under the said contracts, the said distributors/sellers are prohibited from selling
the products in retail stores and e-commerce websites. There is no doubt that, title
to the products passes immediately upon the sales by the Plaintiffs to the
distributors/sellers, however, the latter are bound by the contracts which are
executed with the Plaintiffs and have to adhere to the same. Thus the passing of
title to goods is conditional in nature.
Some of the sellers who are impleaded in the present suits, were
revealed as being distributors of the Plaintiffs‟ in different avatars, but were
listing their products under different names. A majority of them are third parties,
who have clearly procured the products through unauthorised channels. The
products may have changed several hands before reaching the sellers who then list
them on the e-commerce platforms. Many of the sellers- Defendants, in these
suits, have given undertakings not to sell the Plaintiffs‟ products on e-commerce
platforms and have also returned the goods that were seized by the Local
Commissioners. However, the platforms themselves state that the rights of the
Plaintiffs as the trademark owners are exhausted upon the first sale taking place
and hence, the Plaintiffs cannot stop the sale of genuine products on e-commerce
platforms.
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Amazon - The policy applies to all products sold on Amazon
irrespective of the sellers and the return and refund policy of the manufacturers.
Amazon‟s return and refund policy is quite vague and only limited return and
refund is available. Several products are marked as non- returnable which include
products of the Plaintiffs, such as Health and Personal Care, Nutrition, Beauty and
other products. In the case of Amazon, the products have to be returned in the
original condition with price tags, user manual, original box, packaging, etc. as
originally delivered. Used products are not returnable.
Flipkart - The return policy is of the seller and there is also a 30-
day return policy in place of Flipkart, which can be bypassed by the seller, if it so
wishes to allow the return of its product. Used products cannot be returned. The
original box/packaging should not be damaged.
Snapdeal - Products are eligible for return only if it is so provided

on the product page. The request for refund and return has to be raised within
seven calendar days from the delivery. There should be no damage to either to the
product or packaging and used products cannot be returned.
1MG - Products can be returned only within seven days of the

delivery. Partially consumed products are not eligible for return. After lapse of
seven days from date of purchase, return is fully at the discretion of the platform.
Healthkart - Return and refund policy is available only if the

product page provides so. Return/refund can be requested only within 14 days and
the product has to be unused, tags, boxes, packaging has to be intact. There cannot
be any damage to the product or to the packaging.
The question thus is whether under such circumstances, e-

commerce platforms or the sellers are entitled to the benefit of Section 30 of the
Trade Marks Act which recognises the principle of `Exhaustion of trade mark
rights‟. Under this principle, the trade mark owner‟s rights are exhausted upon the
first sale of the product being made. This is also known as the `First Sale‟ doctrine
64
in some jurisdictions. There are three types of Exhaustion - domestic exhaustion,
regional exhaustion and international exhaustion. As per the settled legal position,
India follows international exhaustion. Regional exhaustion is followed in
countries which together are considered to be single markets such as the European
Union.
Enormous reliance is placed by the Defendants on the judgment of

the Delhi High Court in Kapil Wadhwa DB (supra) which holds that India follows
international exhaustion. On the strength of this judgement it is argued that the
products being genuine, even if the unique codes/QR codes are removed, even if
the warranties/return and refund policies are changed, the Plaintiffs would not
have any right in law to control advertising, distribution and sale of the products
after the initial first sale. The submission is that once the title in the product has
passed from the Plaintiffs to the distributor/direct seller who purchases it from the
Plaintiffs, the Plaintiffs cannot seek to control the downstream distribution and
sale of the products.
Defendant Nos.1 to 5, i.e., the sellers are restrained by an interim

order of injunction from advertising, displaying, offering for sale products of the
Plaintiff, namely Oriflame products
Defendant No.6 - Amazon Sellers Services Pvt. Ltd. is

restrained from displaying, advertising, offering for sale, selling, facilitating
repackaging of any of the Plaintiff - Oriflame‟s products on its website
www.amazon.in and mobile application Amazon Online Shopping, except of those
sellers who produce written permission/consent of the Plaintiff for listing of the
Oriflame products on the Amazon platform/mobile application.
In case of the sellers, if any, who produce consent given by the

Plaintiff-Oriflame, allowing sale of its products through e- commerce platforms,
Defendant No.6 - Amazon shall, clearly, provide the name, address and contact
details of the said sellers, including the telephone numbers, email address, etc., in
a prominent manner, along with the product description.
65
If the Plaintiff finds during the pendency of the suit that any of the
sellers have displayed its products on the Amazon platform or mobile application
without its consent, then it shall give notice to Amazon for taking down the
listings of such sellers, which shall be duly taken down within a period of 36
hours by Amazon. All the applications are disposed of in the above terms. No
order as to cost.
Case 4: Transformative Learning Solutions vs Pawajot Kaur Baweja & Ors. :

by Delhi High Court: on 28 August, 2023
This judgment decides Issue 1, framed by this Court on 10

November 2022, which reads as under: "1. Whether the suit as framed is
maintainable in the light of the judgment in Navigators Logistics Ltd v. Kashif
Qureshi & Ors., 2018 SCC OnLine Del 11321? OPD"
The objection that the present suit is not maintainable in view of

the judgment in Navigators Logistics1, rendered by a learned Single 1 (2018) 76
PTC 564 16:36:54 Judge of this Court, was first taken, in the present proceedings,
by Defendant 2 on 30 October 2018. It finds reference in certain subsequent
orders as well. Both sides requested, on 30 August 2022, that the issue of
maintainability of the present suit in the light of Navigators Logistics1, be decided
as a preliminary issue. On 10 November 2022, this Court framed the question as
Issue 1, among the various issues framed for determination in the case.
Subsequently, the case was adjourned from time to time for hearing arguments on
Issue
Arguments were finally addressed on the said Issue on 24 August

2023 and orders were reserved, to be pronounced today.
Mr. Saikrishna Rajagopal argued on behalf of the plaintiffs and Mr.

Kshitij Sharada and Mr. Rajat Aneja argued on behalf of the applicant-defendants.
66
Issue 1, as drawn, has specifically to be decided only with
reference to "the suit as framed". What has to be seen, therefore, is the plaint, and
what is pleaded therein.
The Plaint 5.1 The case that the plaintiffs have sought to set up in
the plaint may be summarised as under.
Plaintiff 2 is a wholly owned subsidiary of Plaintiff 1. The

plaintiffs sell Ayurveda related products. Defendants 1 and 2 are former
employees of the plaintiffs. After leaving the plaintiffs, they are carrying on
business under the title of "Adya Ayurveda", impleaded as Defendant 3.
During the time of their employment with the plaintiffs,

Defendants 1 and 2 had access to confidential data of the plaintiffs. After leaving
the plaintiffs, it is alleged that Defendants 1 and 2 are using the said information
to sell competing products under the brand of Defendant 3. It is also alleged that
Defendants 1 and 2 are using the customer database of the plaintiffs to solicit their
customers. 84% of the customers of Defendants 1 and 2 are stated to be erstwhile
customers of the plaintiffs. It is further alleged that Defendants 1 and 2 are using
marketing material developed and owned by the plaintiffs. The plaint further
asserts that, on Defendant 1's website www.adyayurveda.com, Defendant 1 has
copy pasted content from the plaintiffs' website, over which the plaintiffs own
copyright.
The customer database of the plaintiffs is stated to be among its

most invaluable copyrighted data, which the defendants have purloined. It is
asserted that the customer data has immense economic value, and that each
parameter of the data can be further utilised to predict and identify potential
customers, which in turn would reduce the advertisement costs for further
customer acquisition. The defendants are also alleged to be using the trade dress
of the plaintiffs so as to create confusion.
67
The plaint has set out, in detail, the manner in which the plaintiffs
"niche customer database" works. It is asserted that, in developing the database,
and the software for its operation, the 16:36:54 plaintiffs have expended over ₹ 28
crores during the period 2014 to 2018. It is further asserted that, each time a
customer purchases a product, or signs up for content on the plaintiffs' website,
she, or he, provides valuable personal data, the protection of which is the
plaintiffs' responsibility. The data is retained by the plaintiffs in accordance with
its Privacy Policy, which is made available to the concerned customer.
The plaintiffs have, therefore, developed proprietary statistical

techniques, database and software. The manner in which these work have been
developed is also explained, in detail, in paras 15 and 16 of the plaint.
As such, asserts the plaint in para 17, the customer database, the
business and trade techniques of the plaintiffs, its marketing and sales content,
advertising strategies and other information all constitute confidential and
proprietary information of the plaintiffs, in which copyright subsists.
Given the nature of the present challenge, it is necessary to

reproduce, in extenso, the relevant assertions in the plaint on the above issues,
thus: During the course of their employment, the Defendant No. 1 and 2 had
access to confidential and proprietary information that belongs to the Plaintiffs.
The information includes customer databases, marketing material, copyrighted
content and online advertising techniques, all of which was obtained and created
by the Plaintiff over the past 5 years at a huge cost, and after application of skill
and judgment. The Defendant No. 1 and 2 were using this information to sell
products under the brand 'Adya Ayurveda', i.e., the Defendant No. 3. The
Defendants are using the Plaintiff has transacted with and built a business
relationship with over a period of about 5 years. The Defendants for this purpose
are using marketing material that was developed by and is owned by the Plaintiff.
This material is being used in marketing emails and on the 1st Defendant's
Website, www.adyayurveda.com. The Defendants No. 1 & 2 copy-pasted
68
Plaintiffs content and used that for marketing products of Defendant No.3 under
the brand name of the Defendant No. 3 in the e-mails sent by the Defendants
addressed to the clients of the Plaintiffs in order to induce such clients to purchase
the said products of the Defendant No.3, to the detriment of the Plaintiff, and with
the intent of unjust enrichment of the Defendants. The fact that this is a slavish
attempt at passing off the products of the Plaintiffs is demonstrated by the
Defendants using of creative copyrighted material of the Plaintiff. The Plaintiffs
also have legitimate reason to believe that the Defendants have been in possession
of the entire database till at least April 2018. Moreover, a comparison of the pop-
ups enabled through the beeketing application/ plug-in containing details of
customers who appear to have bought products from the Defendant No.3, as
viewed on the website of the Defendant No.3 with the actual list of customers of
the Plaintiffs showed a match of upto 84% of such customers.
The Plaintiffs accordingly have very strong reasons to believe that

the persons to whom the Defendant No.3 has sold its products are the customers
of the Plaintiffs, and that such sale has occasioned on account of theft of the
customer database by the Defendants No.l and 2.- The Defendants purposely copy
pasted material that belonged to the Plaintiffs in which the Plaintiff No. 1 had
copyright, in order to create confusion in the mind of the Plaintiffs' customers,
while selling the products of the Defendant No.3, which is evident from the
documents, and transcripts of customer calls filed along with the Plaint, and is not
repeated herein for the sake of brevity. Such information as to the details of
customers of the Defendant No.3 would be available to the Defendant No.l, and
the Defendant No.l is called upon to indicate such details to this Hon'ble Court. It
is highly suspicious that more than 84% of the customers of the Defendant No.3,
as displayed on the beeketing application, match the list of customers of the
Plaintiffs. Such a high co-relation only further lends credence to the fact that the
Defendants had access to, had obtained illegally, and had used, the confidential
proprietary customer database of the Plaintiffs. Pertinently, the reason why the
Plaintiffs also ought to be compensated for such unauthorized use of database of
69
customers living in countries outside India is on account of possible liabilities that
may arise out of use of such details in a manner that has not been authorized by
the person who has provided to the Plaintiffs his or her personal details. Moreover,
such personal data is provided to the Plaintiffs by its customers as is explained in
detail in the succeeding paragraphs. Such data has enormous economic value, as
also has immense potential to benefit a company engaged in a similar business as
the Plaintiffs. Such immense potential is on account of not just a direct list of
customers, but the ability to utilize each parameter of data relating to such
customers to further predict/identify potential customers, thereby significantly
reducing the advertising costs for further customer acquisition. In the present case,
the Defendants No.l & 2 have not just accessed such data on account of their
employment with the Plaintiffs, but have actually been provided access by the
Plaintiff. This is to say that every employee does not automatically by virtue of
being employed with the Plaintiffs know details of customers/potential customers,
but such employee only comes into possession of customer data upon specific
authorization, or at times through concerted actions for such access. The
Defendant No. 1 copy-pasted Plaintiffs content and used that for marketing in its
emails. It is submitted that the Defendant No. 1 purposely copy pasted material
that belonged to the Plaintiff No.l in which the Plaintiff No.l had copyright, and
used the trade dress of products of the Plaintiff No.l while selling products of the
Defendant No.3 in order to create confusion in the mind of Plaintiffs customers
which is evidenced in the Suit and is not repeated herein for the sake of brevity.
Such information as to the details of customers of the Defendant No. 3 would be
available to the Defendant No.l, and the Defendant No.l is called upon to indicate
such details to this Hon'ble Court. It is highly suspicious that more than 84% of
the customers of the Defendant No.3, as displayed on the beeketing application,
match the list of customers of the Plaintiff No.l. Such a high co-relation only
further lends credence to the fact that the Defendant No. 1 had access to, had
obtained illegally, and had used, the confidential proprietary customer database of
the Plaintiff No.l. Pertinently, the reason why the Plaintiff No. 1 also ought to be
compensated for such unauthorized use of database of customers living in
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countries outside India is on account of possible liabilities that may arise out of
use of such details in a manner that has not been authorized by the person who has
handed over his or her personal details. Moreover, such personal data is provided
to the Plaintiffs by its customers as the end result of its unique business
process/strategy/method. This is explained in detail in the succeeding paragraphs.
Such data has enormous economic value, as also has immense potential to benefit
a company engaged in a similar business as the Plaintiffs. Such immense potential
is on account of not just a direct list of customers, but the ability to utilize each
parameter of data relating to such customers to further predict/identify potential
customers, thereby significantly reducing the advertising costs for further
customer acquisition. In the present case, the Defendants No.1 & 2 with the
Plaintiffs, but have actually been provided access by the Plaintiff. This is to say
that every employee does not automatically by virtue of being employed with the
Plaintiffs know details of customers /potential customers, but such employee only
comes into possession of customer data upon specific authorization, or at times
through concerted actions for such access.
The business model of the Company is unique inasmuch as it sells

Ayurveda related products and courses using only online platforms to consumers
primarily located outside India. It sells the products only on its own
website/domain http: / /theavurvedaexperience.com/ which is run via Shopify, a
web based ecommerce store. For this purpose, the Plaintiff herein had made large
monetary investments on various online platforms including the social networking
site Facebook, in order to target a range of customized set of individuals, who
would then be shown specific advertisements tailormade for that category of
individuals, in order to then induce such individuals to click on advertisements,
thereby leading to the website of the Plaintiff, in which such individual would
voluntarily provide details to the Plaintiffs, if s/he chooses to purchase the
product. Such data was provided to the Plaintiffs voluntarily and with the
conscious knowledge that the sharing of such information was protected by terms
and conditions available on the website of the Plaintiffs, particularly the privacy
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policy, the Plaintiffs proposed to adopt. Therefore, any proposed violation could
open the Plaintiffs to potential harm including, but not limited to legal recourse
against the Plaintiffs. Such details were parted with by the individuals/ proposed
customers in line with the privacy policy available on the website of the Plaintiffs,
and any violation of such policy/unauthorized access / use of data could lead to
potential harm. As such, the Plaintiffs obtained and established a niche customer
database, which in itself has enormous spring-boarding effect. The decision to
undertake expenditure to obtain details of a particular kind of audience who is
then targeted, is premised upon in-depth analytical research conducted by the
Plaintiffs in order to ensure that marketing is only done for audiences who become
profitable in the long term. Upon establishing its target audience, the Plaintiffs
spend capital to be able to obtain access to such target audience through websites
such as Facebook. The Plaintiff then uses engaging and innovative advertisements
developed using skill and judgment, which are also tailor-made for different
categories of such target audiences, in order to ensure a higher click to conversion
rate. For instance, a lady who is in her fifties and who enjoys Starbucks coffee
would be shown a specific set of catchwords, with a specific going to Fitness First
gymnasiums. Such customers are then induced to click on the advertisement that
leads to the website of the Plaintiffs, showcased the appropriate products (which
may be most relevant to them) through copyrighted creative content, subsequent
to which they voluntarily provide their personal information, while purchasing the
product. Such personal information includes data such as their names, e-mail
addresses, home/office address, and phone numbers.
It is pertinent to note that each product has a different set of

copyrighted creatives, and in many cases audiences used to promote such product.
Both such creatives and selection of specific audiences are continuously optimized
by a team of professionals employed by the Plaintiffs, to achieve the most optimal
return on advertising spend/ reduce customer acquisition cost, and therefore
requires application of significant skill and judgment for adapting strategy and
operations to such processes which are. constantly evolving. The copyrighted
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customer data received post the completion of several manual and online creative
processes developed over a substantial period of time is only generated upon the
customer undertaking a purchase transaction. As such, the Plaintiffs only obtain
the information after twice exercising their unique skill, judgment, and substantial
statistical research - first to decide which persons to show advertisements to; and
second to design specific advertisements for a specific product for such persons,
which would then induce them to visit the webpage of such chosen product on the
website of the Plaintiff. Lastly, the website of the Plaintiff No. 1 also contains
copyrighted material which then sets the pitch for proposed customers to and
make a purchase decision, and thereby provide the above-mentioned data to the
Plaintiffs. Such development of material, including the database of customers is
not just on the basis of labour or capital having been expended, but is clearly the
result of skill and judgment of the Director and certain other employees of the
Plaintiffs, which cannot be characterized as purely mechanical. Moreover, taking
several granular advertising investment decisions on the basis of the cookie-data,
and other analytical data obtained by the Plaintiff is also a part of its sophisticated
marketing methods. In this regard, the Plaintiffs have invested substantial capital,
labour, and time in order to test over 1900 such audiences to perfect their ability to
predict fruitful advertising targets. It has come to the knowledge of the Plaintiff
that the Defendant Nos. 1 & 2 through the Defendant No.3 have been illegally
spamming the customers of the Plaintiffs. It is on account of trying to reach the
appropriate targeted markets/ customers that the Plaintiff expends huge
expenditure to obtain a targeted database. However, by accessing, and stealing
such customer database of the Plaintiff No. 1 in a wholly unauthorized and illegal
manner, the Defendants No.l and 2 have obtained a Ayurveda products without
having to spend any amount of money, and without exercising even a modicum of
skill and judgment. Further, the Plaintiffs have spent over Rs. 28 Crore (Rupees
Twenty-Eight Crore only) in order to obtain information which is/has been being
illegally used by the Defendants Nd.l and 3.
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Over a period of time, due to the enormous resources that have
been put in by the Plaintiff, 499,500 subscribers have signed up for free content on
the Plaintiffs website, 17,935 persons have bought courses from the Plaintiff and
the Plaintiff has shipped 142,635 products to 88,798 customers. Each time a
consumer makes a purchase or signs up for content, the consumer provides
personal data to the Plaintiff. This database is thereafter the responsibility of the
Plaintiff (and its employees) and is used by it solely in accordance with its Privacy
Policy that is made available to the consumer. The Plaintiff has a fiduciary duty
towards its customers. The names of these customers, their email addresses,
mailing addresses, phone numbers and other data relating to these customers is the
confidential information of the Plaintiff.
The decision in Navigators Logistics1 6.1 The plaintiff in

Navigators Logistics ("NL" hereinafter) was one; the defendants 12. 8 of the
defendants were former employees of NL and were, therefore, privy to NL's
confidential information. As in the present case, the employment contracts of the
eight defendants with NL contained non-compete and non-soliciting covenants.
All eight defendants resigned between 9 May 2016 and 25 May 2016. Data
recovery, undertaken on the defendant's laptops after they had resigned revealed
that they had hatched a conspiracy to use the confidential data information and
trade secrets of the plaintiff to its detriment and to further their own business
interests. It was also seen that the defendants had conspired to divert the existing
business of the plaintiff to Defendant 12 and that, in the process, confidential
information, which had come into the position of Defendants 1 to 8 during their
employment with the plaintiff, was forwarded to Defendants 9 to 11. In these
circumstances, NL sued the defendants, seeking reliefs which are more or less
similar to those sought by the present plaintiffs before this Court.
Before proceeding to examine Issue 1, framed in the present case,

on merits, in the light of the decision in Navigators Logistics1, it has to be noted
that, in that case, Endlaw, J. found none of the pleas advanced in the suit to be
making out a cause of action, as could sustain a prayer for injunction. To wit, it
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was found that (i) though copyright had been asserted in various documents, no
particulars were forthcoming in respect of any of the said documents, except the
list of customers/clients of NL, (ii) a list of customers/clients, drawn up without
any element of creativity, and which had no economic/business/commercial value,
could not be regarded as confidential or partaking of the character of a trade
secret, as the details of the clients were available in the public domain and could
even be sourced from the telephone directory, (iii) sans any element of creativity
or commercial value, such a client/customer list could not be subject matter of
copyright, (iv) the author of the said list was also not identified, which was a sine
qua non for claiming copyright therein, (v) NL had not pleaded that the defendants
were privy to the trade secrets and (vi) the non-compete clause in the
employment 8 (2006) 4 SCC 227 16:36:54 contracts, that NL sought to enforce,
was not enforceable at law, as it amounted to a covenant in restraint of trade. As,
therefore, none of the grievances of NL birthed a cause of action, which could
translate into an injunction, the suit was dismissed.
Why this aspect assumes importance is because the exercise carried

out by the learned Single Judge in Navigators Logistics1 is essentially relatable
to Order VII Rule 11 of the Code of Civil Procedure, 1908 (CPC), which is the
only provision under which, without trial, a suit can be dismissed. A suit can also
be dismissed at the instance of the defendant under Order XII Rule 6, on the basis
of admissions by the plaintiff but, even in such a case, ordinarily the dismissal
would be under Order XII Rule 6 read with Order VII Rule
The only other provision under which a suit can be guillotined even
before trial is Order VII Rule 10, where the Court has no jurisdiction to adjudicate
on the suit, in which case the plaint would have to be returned for presentation
before the proper forum. In all other cases, bar none, a suit has to proceed to trial.
It is equally well-settled that, under Order VII Rule 11, the plaint
cannot be rejected in part. It has either to be rejected as a whole, or has to proceed
to trial. This position of law stands enunciated in several decisions of the Supreme
75
Court, including Sejal Glass Ltd. v. Navilan Merchants P Ltd9 , Madhav Prasad
Aggarwal v. Axis Bank Ltd10 and, most recently, Bhim Rao Baswanath Rao Patil
v. Madan Mohan Rao11. In Navigators Logistics1, this Court 9 (2018) 11 SCC
780 10 (2019) 7 SCC 158 11 2023 SCC OnLine SC 871 16:36:54 found that no
sustainable cause of action, on the basis of which the prayers in the suit could be
granted, arose out of any of the grievances raised by the plaintiff. Had this Court
found, on the other hand, that even one of the said grievances gave rise to a triable
cause of action, the suit could not have been dismissed, and would have had to
proceed to trial as a whole.
Mr. Sharda further submits that the plaint was devoid of any
particulars on the basis of which a finding of infringement of copyright could be
returned by the Court. The entire case, he submits, is purely speculative in nature,
based on a search of the defendants' website.
Supplementing the submissions of Mr. Sharda, Mr. Aneja submits

that a meaningful reading of the plaint in the present case 16:36:54 discloses no
triable cause of action. As such, he submits that, applying Navigators Logistics1,
the suit is liable to be dismissed, by deciding Issue 1 in favour of the defendants
and against the plaintiffs.
Responding to the submissions of Mr. Sharda and Mr. Aneja, Mr.

Rajagopal, learned Counsel for the plaintiffs submits that the decision in
Navigators Logistics1, in fact, supports the case of the plaintiffs rather than that of
the defendants. While staunchly refuting the submission of Mr. Sharda that
copyright was claimed, in the present case, only in respect of the client/customer
list of the plaintiffs, Mr. Rajagopal submits that even if, arguendo, it were to be so
assumed, the present plaintiffs would nonetheless be eligible to proceed to trial
even applying the decision in Navigators Logistics1. He submits that, in
Navigators Logistics1, this Court found the clients/customers list, in respect of
which copyright was being played by NL, to be incapable of being subject matter
of copyright, as no element of creativity had been pleaded to have gone into the
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creation of the said list, and the list was not shown to be possessing any economic
or business value. In the present case, Mr. Rajagopal submits that there are
detailed assertions in the plaint regarding the manner in which the customers list
had been prepared and operated, including the assertion that, in preparing the list,
expenses of ₹ 28 crores had been borne by the plaintiffs. Equally, the assertions in
the plaint, he submits, clearly indicate that the list had deep and pervasive
economic value for the plaintiffs, unlike the list which forms subject matter of
consideration in Navigators Logistics1. In fact, he submits that the plaintiffs have
specifically alleged, in the plaint, that Defendants 1 and 2 were using the
copyrighted information of the 16:36:54 plaintiffs to sell products under the brand
of Defendant 3, which itself vouchsafed its commercial value. As such, submits
Mr. Rajagopal, the present suit cannot be said to be devoid of any cause of action,
as would justify its decapitation without a trial, as was the sorry fate of Navigators
Logistics1.
No detailed analysis is required. The assertions in the plaint in the

present case clearly distinguish it from the plaint in Navigators Logistics1. Issue 1,
as framed, is to be decided solely by reference to the plaint. That, in any case, is
also the well settled remit of Order VII Rule 11 of the CPC12.
The passages from the plaint, extracted in para 5.8 supra, clearly
underscore the painstaking manner in which the plaintiffs developed its entire
confidential data base, of which the customer list is but a part. There are detailed
averments and assertions which bear out the great deal of technical expertise,
inventiveness and creativity which has gone into the generation of the customers
list. To equate the present case with Navigators Logistics1 would, therefore, be to
equate chalk and cheese. It is also clear, from these passages as well as other paras
in the plaint, that the "confidential information", with respect to which protection
is sought in the plaint, is not limited to client/customer lists, but involves a great
deal of additional material, including material which is alleged to have been copy
pasted from the 12 Refer Allied Blenders & Distillers v. R.K. Distilleries, (2017)
77
69 PTC 493 (DB) 16:36:54 plaintiffs' website onto the defendants' website so as to
confuse clients.
Significantly, in Navigators Logistics1, the Court relied on the

report of local commissioners who had visited the premises of the defendants and
clarified that, barring client/customer lists, there was no other material pertaining
to the plaintiffs with the defendants. No such report, of any local commissioners,
is forthcoming in the present case. Even otherwise, I must confess, with greatest
respect, my reservation to the reliance placed by this Court, in Navigators
Logistics1, on local commissioners' reports. The Court was, in that case,
exercising jurisdiction effectively under Order VII Rule 11 of the CPC. It could
not, therefore, have looked at material outside the plaint filed by the plaintiff.
Perhaps, therefore, the reliance, by the Court, on the local commissioners' reports
was not entirely apposite.
The prayers, in the plaint, for an injunction against the defendants

dealing with the plaintiffs' confidential information, and the claim of copyright
therein cannot, therefore, be said to disclose no cause of action, as would justify
the suit proceeding to trial. Nor can they be said to be so vague and inexact in
particulars that no trial, based on such pleadings, would be possible, as was found
in Navigators Logistics1.
Once a triable issue is found to exist, the suit cannot be dismissed

at the outset, as was done in Navigators Logistics1. It has to proceed to trial.
Issue 1 is, therefore, decided in the affirmative, in favour of the

plaintiffs and against the defendants.
Case 5: Tata Consumer Products Limited vs M/S Varahi Limited & Anr: by
Delhi High Court – Orders: on 14 November, 2022
This hearing has been done through hybrid mode. The present suit
for permanent injunction restraining infringement of trademark, passing off,
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dilution, etc. was filed by the Plaintiff- Tata Consumer Products Limited seeking
protection of the mark 'HIMALAYAN' used in respect of natural mineral water.
The case of the Plaintiff is that the mark 'HIMALAYAN' was adopted by it in the
year 1994 through its predecessor. The said mark is registered in favour of the
Plaintiff in various classes including Classes 16, 30, and 32. The grievance of the
Plaintiff in the present case is that the Defendants were selling packaged drinking
mineral water on an e-commerce platform under the brand name 'HIMALAYA',
which is deceptively similar to the Plaintiff's mark 'HIMALAYAN'.
Further, defendants are directed to take down references to the

plaintiffs trade mark 'HIMALAYAN' including the mark HIMALAYA from its
website, face book, Instagram and other ecommerce platforms.
Vide the said order, two Local Commissioners were also appointed
to visit the premises of the Defendants. The Defendants had then filed an
application under Order XXXIX Rule 4 CPC seeking vacation of the injunction.
Vide order dated 20th July, 2022 Justice Manmohan Singh (Retired), Judge, Delhi
High Court was appointed as the Mediator under the aegis of the Delhi High Court
Mediation and Conciliation Centre to attempt an amicable resolution of the
disputes.
Today, ld. Counsel for the parties submit that the disputes have
been resolved vide settlement agreement dated 13th October, 2022. As per the said
agreement, the Defendants have agreed / undertaken not to use the mark
'HIMALAYAN', 'HIMALAYA' or any other deceptively similar mark thereto in
respect of mineral water. They have also undertaken not to apply for trademark or
copyright registration in respect of the said marks. As per the settlement
agreement, the Defendants have also agreed to withdraw various trademark
applications filed by them, as set out in paragraph 21 of the written statement,
within ten days. Mr. Vashishtha, ld. Counsel for the Defendants submits that the
said trademark applications have already been withdrawn by the Defendants.
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The Court has perused the settlement agreement. The same is
signed by the Ld. Mediator. Consent emails have been submitted by the parties to
the Ld. Mediator. The terms of the same are lawful and there is no impediment in
recording the settlement. Parties and all others acting for or on their behalf shall
be bound by the terms of the settlement. The seized goods may be released to the
Defendants on the condition that the Defendants shall destroy the labels, cartons,
and other promotional material containing the mark 'HIMALAYAN' or
'HIMALAYA'. The said proceedings shall be carried out in the presence of the
Plaintiff's representative in terms of clause 8 of the settlement agreement on or
before 15th December, 2022. Both the parties have agreed not to publish or
disclose the terms of settlement to the public.
The suit is decreed in terms of paragraph 1 to 9 of the settlement

agreement. The prayers in para 56 (vi), (vii), (viii), and (ix) are not pressed by the
Plaintiff. Insofar as the relief of declaration of well known mark as prayed in Para
56 (iv) is concerned, the same is not being considered in the present case as the
disputes have been settled. The Plaintiff is given liberty to seek the said prayer in
an appropriate case.
Decree sheet be drawn accordingly. All pending applications are

disposed of. In view of the settlement and the judgment of the ld. Division Bench
in Nutan Batra v. M/s Buniyaad Associates, 2018 (255) CLT 696, full court fee is
refunded to the Plaintiff through counsel.
Case 6: Groupon, Inc vs Mohan Rao And Another: by Delhi High Court: on
19 March, 2014
These applications have been filed by the plaintiff under Order 39

Rule 1 & 2 of the Civil Procedure Code, 1908 (hereinafter "CPC") against
defendant no.1 &2 praying for an order of ad-interim temporary
injunction pending hearing and final disposal of the suit and by the defendants
under Order 39, Rule 4, CPC praying for an order vacating the ex parte ad interim
injunction granted in favour of the plaintiff vide order dated 27.05.2011.
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The plaintiff prays for an order restraining the defendants by
themselves, their partners, servants, agents, representatives and all those acting in
concert with them or claiming under or through them from using the mark
GROUPON and/or any deceptive variation thereof upon or in relation to their
business, products, services and /or as a part of their trade name, website, web
address, internet domain name, email address and from in any manner passing off
or attempting to pass off or causing, enabling or assisting others to pass off their
business, products and services as and for the business, products and services of
the plaintiff.
The plaintiff also seeks to restrain the defendants from indulging in

any activity which dilutes the distinctive character of the plaintiff‟s mark
GROUPON in addition to a temporary injunction directing the defendants to
transfer the domain name www.groupon.in in favour of the plaintiff pending
hearing and final disposal of the suit. Plaintiff's case and submissions:
The plaintiff, GROUPON Inc is a company organized under the

laws of State of Delaware, headquartered at Chicago, USA. The plaintiff‟s
predecessor in interest adopted the mark GROUPON in the year 2002.
Subsequently since 2008, the plaintiff has offered online audiences daily discounts
on products and services under the name and brand GROUPON through the
plaintiff‟s website www.groupon.com which features daily deals on products and
services in more than 40 countries.
Defendant no.1 is the director of defendant no. 2 Company

incorporated under the provisions of the Companies Act, 1956, having its
registered office at Bengaluru, Karnataka. The defendants through their website
www.groupon.in are engaged in an identical business of offering discount
coupons. The defendants hold a valid trademark registration in India for the mark
GROUPON in class 35 - which pertains to advertising, sales promotion for others,
business promotion for others, advertisement through website, marketing,
advertisement and business promotion by using gift vouchers and coupons etc.
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Against the aforementioned registration in favour of the defendants, the plaintiffs
have already instituted cancellation proceedings before the Intellectual Property
Appellate Board (IPAB). The defendants also own the domain names
www.groupoff.com and www.groupoff.in.
Vide order dated 27.05.2011, this Court issued summons in the suit
and passed an ex parte order restraining the defendants from using the mark
GROUPON and/or any deceptive variation thereof.
Mr. Sanjay Jain, learned senior counsel for the plaintiff submits
that the mark GROUPON is a coined word adopted by the plaintiff‟s predecessor
in interest as a combination of the words "group" and "coupon" in 2002. He
submits that in 2008, the plaintiff company - which was originally named
ThePoint.com Inc, announced the launch of GROUPON as a website using the
power of group purchasing to offer daily deals from the domain name
www.getyourgroupon.com registered by the plaintiff on 14.10.2008.
The case of the plaintiff is that on 10.03.2009, the plaintiff filed a

trademark application for the mark GROUPON in USA which was granted in
favour of the plaintiff on 22.09.09. On 07.06.2009, the plaintiff acquired the
domain name www.groupon.com from its predecessor, and began operating the
website from the aforesaid domain name. On 16.06.2009, the plaintiff changed its
corporate charter to officially reflect the corporate name change to "GROUPON,
INC." on which date the defendants had not yet commenced their business under
the impugned mark. On 12.10.2009 - the date on which the defendant no.2 was
incorporated, the plaintiff already had a subscriber base of 8,91,972 people - being
prior user of the mark since 2008.
The plaintiff avers that in addition to www.groupon.com, it also

owns hundreds of other domain names which incorporate the mark GROUPON
and its formatives, including several country specific domain names such as
groupon.de, groupon.jp, groupon.sg, groupon.kr amongst others. In India, the
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plaintiff is the registrant of the domain name www.groupon.co.in, which was
created on 22.09.2009.
Mr. Jain submits that the plaintiff‟s website www.groupon.com

receives significant traffic from India, and according to a data report by
COMSCORE, in the fourth quarter of 2010 alone, over 30000 visitors with Indian
IP addresses visited the plaintiff‟s website. It is submitted that owing to the
popularity of the plaintiff‟s website in India, the plaintiff also filed for registration
of the trademark GROUPON in India on 26.03.2010 which is pending. The
plaintiff submits that in January 2011, it acquired an Indian website
www.sosasta.com which was also in the business of offering online discount
coupons. On acquisition of www.sosasta.com, the plaintiff immediately started
using the mark GROUPON on the aforesaid website.
Mr. Jain submits on the basis of the above facts that the plaintiff
has been in the business of offering discount coupons under the mark GROUPON
since 2008. The plaintiff claims that in September 2010, the plaintiff became
aware that defendant no. 1 is the registrant of the domain name www.groupon.in.
The plaintiff immediately got in touch with defendant no.1 for purchasing the
domain name www.groupon.in vide email dated 20.09.2010. Defendant no.1
responded to the plaintiff‟s email 4 months later on 20.01.2011, indicating that he
was not interested in selling the domain name www.groupon.in, but was open to
pursuing business in India with the plaintiff.
The plaintiff avers that, subsequently, the plaintiff and defendant

no.1 had a teleconference during which the plaintiff was informed that the
defendant no.1 had a pending trademark application in India for the mark
GROUPON. On requesting further clarification from the defendant no.1 on its
trademark rights qua the mark GROUPON, the defendant no.1 informed the
plaintiff of all details relating to its trademark application on 31.01.2011, and also
asked the plaintiff to cease using the mark GROUPON on the website of the
plaintiff‟s Indian counterpart www.sosasta.com. Subsequently, the defendant no.1
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offered a proposal for sale of the domain name www.groupon.in for USD 5
million which the plaintiff rejected. The plaintiff submits that in March 2011, the
defendant no.1 informed the plaintiff that the mark GROUPON had been
registered in favour of defendant no.1.
The case of the plaintiff is that initially the defendants launched

their services under the domain name www.groupoff.com, which was intended
to be a play off of the plaintiff‟s mark GROUPON. Mr. Jain submits that the
defendants sought to begin operations from the website www.groupon.in only in
February 2011, after an article in Times Of India dated 16.01.2011 announced the
entry of the plaintiff in India. He further submits that the defendants were well
aware of the plaintiff‟s mark, as the defendant no.1 was willing to enter into a
business relationship with the plaintiff in India in January, 2011. He submits that
in the Time Warner Entertainment Company, L.P Vs. A.K. Das, 1997 PTC 17 Del,
this Court observed that the trans-border reputation can be inferred, if the
defendant seeks a common venture with the plaintiff.
Mr. Jain further submits that the defendant no.1 was present in
USA in 2008, around the time when the plaintiff was at an advanced stage of
launching its services under the mark GROUPON. He submits that the subsequent
adoption of the impugned mark by the defendants is with a mala fide intention to
free ride on the plaintiff‟s reputation and popularity. He submits that the mala fide
intent of defendant no.1 is further fortified by the fact that the defendant no.1
owns in excess of 100 domain names, some of which incorporate the marks of
various American Companies.
Mr. Jain submits that the plaintiff is the prior user of the mark
GROUPON since 2008. It was only on 12.09.2009 that the defendant no.1, for the
first time, sought to adopt the mark GROUPON by registering the domain names
www.groupon.in, www.grouponindia.com, www.groupoff.in and
www.groupoff.com - by which date, the plaintiff already had a subscriber base of
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6,27,051 people and had been operating under the mark GROUPON for over a
year.
Mr. Jain submits that defendant no. 1 filed a trademark application

for the mark GROUPON for the first time on 29.09.2009 in India, by which time
the mark of the plaintiff had already been registered in USA. He submits that it is
only on 26.02.2011 that the defendants sold their first coupon through their
website www.groupon.in, by which time the plaintiff had already been operating
under the mark GROUPON for over two years in USA, and had been named as
the fastest growing company by Forbes magazine in an article dated 30.08.2010.
Mr. Jain submits that by virtue of prior use of the mark GROUPON, the plaintiff
is entitled to the exclusive use of the mark and the plaintiff will suffer irreparable
loss if the defendants are not restrained from passing off their services as those of
the plaintiff.
Mr. Jain submits that by the time the defendants sought to sell their
first coupon on 26.02.2011, the plaintiff had already acquired considerable amount
of trans-border reputation in India, that had spilled over into India on account of
the plaintiff‟s coverage in various international magazines and websites - such as
Business Insider, mashable.com, techcrunch.com, Forbes Magazine etc. Mr. Jain
relies upon the decision of the Court in Jolen Inc. Vs. Doctor & Company, 2002
(25) PTC 29 (Del), wherein this Court observed that advertisements in newspapers
travel beyond the country where a party is engaged in business through overseas
editions, or otherwise, thereby disseminating information about the mark.
He submits that apart from coverage in international magazines,

even websites in India such as StartupDunia covered the plaintiff‟s business
model as early as on 15.09.2009. He further submits that the plaintiff was covered
by Times of India on 01.12.2010 citing speculation that Google was close to
buying the plaintiff company for $6 billion. He submits that the aforesaid news
was also covered in Hindustan Times on 05.12.2010. Mr.Jain submits that the
85
aforesaid demonstrates the reputation and credibility of the plaintiff‟s business in
India prior to the commencement of the defendants‟ business in February, 2011.
Mr. Jain submits that the fact that in the fourth quarter of 2010,
30,000 visitors with Indian IP addresses had visited the plaintiff‟s website
www.groupon.com. shows that Indian consumers were aware of the plaintiff‟s
website www.groupon.com even before the defendants sold their first coupon on
26.02.2011 on their website www.groupon.in. He submits that on account of prior
use as well as trans-border reputation of the mark, the plaintiff is entitled to seek a
restraint against the defendants from adopting the impugned mark. In support of
this submission, Mr. Jain relies on the decisions in N.R. Dongre v. Whirlpool
Corporation, AIR 1995 Del 300 and Allergan Inc v. Milmet Oftho Industries, 1997
2 CAL LT .
Mr. Chandra submits that as per the plaintiff‟s own averment in the
plaint it had no use - actual or otherwise, of the mark GROUPON in India in
September 2009, when the defendants started using the mark. In this regard, he
refers to the averments contained in Para 5.2 of the plaint, in which states that
Indian consumers were aware of the plaintiff‟s website as 30000 visitors with
Indian IP addresses visited the plaintiff‟s website www.groupon.com in the fourth
quarter of 2010. In addition, it is pleaded that the plaintiff acquired
www.sosasta.com in January, 2011 in India which received huge media attention.
Mr. Chandra submits that it is only on 26.03.2010 that the plaintiff applied for
registration of the mark GROUPON in India and that too on "proposed to be used"
basis and, therefore, even as in March, 2010, the plaintiff was not clear about its
intention to extend its services to India.
Mr. Chandra submits that September, 2009 should be construed as

a "cutoff date", and the plaintiff has failed to prove that the plaintiff‟s business
had strong goodwill and reputation in India prior to September, 2009, which is
when the defendants commenced their business under the mark GROUPON. He
submits that, therefore, as in September, 2009, the defendants cannot be said to
86
have been passing off their services as those of the plaintiff, as the plaintiff did not
enjoy any goodwill or reputation in India.
Relying upon the decision of this Court in Sakalain Meghjee Vs.

BM House(India) Ltd., 2002 (24) PTC 207, Del, Mr. Chandra submits that in
order to establish trans-border reputation, the plaintiff must place on
record substantial evidence in the form of advertisements, journals, coverage in
magazines, brochures etc. which the plaintiff has failed to do. He submits that
merely because 30,000 visitors with Indian IP addresses visited the plaintiff‟s
website in the last quarter of 2010 is not, by itself, sufficient to prove trans-border
reputation of the plaintiff‟s mark in India in 2010. He further submits that the
aforesaid data is only for the fourth quarter of 2010
Mr. Chandra submits that article dated 15.09.2009, relied upon by

the plaintiff, does not prove trans-border reputation as it is only a write up seeking
to educate people on the concept of group coupons. He relies on the decision in
M/s. Smithkline Beecham Plc. & Ors. Vs. M/s. Hindustan Lever Limited & Ors.,
2000 PTC 83, wherein the Court observed that mere publication of advertisement
in a dental journal cannot establish trans border reputation of the plaintiff‟s
toothbrush under the trademark „ACQUA FLEX‟.
Mr. Chandra submits that, of the documents placed on record by

the plaintiff to establish trans-border reputation of its mark, only four documents
pertain to India, each of which pertain to the period subsequent to 12.09.2009, i.e.
the date on which the defendants started using the mark. He submits that in the
absence of any evidence of goodwill or reputation in India, it cannot be presumed
that the plaintiff‟s mark had achieved trans- border reputation in 2009. He further
submits that mere trans-border reputation is not sufficient and the plaintiff must
prove use of the mark in India. He relies on Paragraph 27 of the decision of this
Court in Roca Sanitario S.A Vs. Naresh Kumar Gupta & Anr., 2010 (7) R.A.J. 634
(Del), wherein relying upon the decision in N.R Dongre (supra), the Court
87
observed that trans border reputation cannot be accepted as the sole criteria for
protection of a registered or unregistered trademark.
Mr. Chandra submits that as in September 2009, at best, the

plaintiff had presence in few cities in USA and, therefore, the defendants were
well within their right to adopt the mark GROUPON, since the plaintiff enjoyed
no trans-border reputation in India. He relies on the decision in Tata Sons Vs.
Manoj Dodia & Ors., 2011 (46) PTC 244 Del to submit that a trademark which is
well known in one country, need not necessarily be well known in other countries
- the controlling requirement being the reputation in the local jurisdiction.
Mr. Chandra further relies on the decision in Trans Tyres India Pvt.
Ltd. Vs. Double Coin Holdings Ltd. & Anr., 2012 (3) R.A.J. 81 (Del) to submit
that the Universality Doctrine, which posits that a mark signifies the same source
wherever the mark is used in the world, has been rejected by Courts. He submits
that prior use of a trademark in one dominion will not ipso facto entitle its owner
to claim exclusive trademark rights in another dominion.
Mr. Chandra submits that the present suit filed by the plaintiff is
mala fide, as it was filed a day after the defendants filed a suit against the plaintiff
in Bangalore seeking to restrain the plaintiff from impinging on the statutory
rights of the defendants.
Mr. Chandra further submits that the plaintiff did not coin the term
GROUPON but merely acquired the website www.groupon.com from its
predecessor, who coined the same. He submits that the business model of group
discount vouchers is such that multiple GROUPON business‟s can exist
simultaneously the world over, as the nature of the business is extremely local and
territorial requiring business link ups with local entities. He submits that for
instance, in China, the domain names www.groupon.com.cn and www.groupon.cn
were registered even prior to the plaintiff‟s registration on 24.09.2008 and, as on
date of filing of the suit, the Chinese domain name exists independently.
88
Mr. Chandra submits that merely because subsequently the plaintiff
may have become a bigger business worldwide, they cannot now seek to usurp the
rights of the defendants qua the mark GROUPON, as, on the date on which the
defendants adopted the impugned mark, they were well within their rights to do
so.
Mr. Chandra submits that the allegations of the plaintiff that

defendant no.1 is a cyber squatter are unsubstantiated and seek to create a
prejudice against the defendant no.1, who has put in considerable amount of
labour and investment into running his business of offering group discount
vouchers online.
In rejoinder, Mr. Jain submits that the "cutoff date" for

ascertainment of - on when the plaintiff must establish trans-border reputation of
its mark, cannot be September, 2009 - when the defendants adopted the impugned
mark. He submits that the same would be the date on which the defendant started
using the impugned mark, and not the date of mere adoption of the impugned
mark by the defendants. In support of this submission, Mr. Jain places reliance on
the decision in Sun Pharamacueticals Vs. Emcure Pharamaceuticals, 2012 (49)
PTC 243 Bom.
Mr. Jain submits that the first use of the mark GROUPON by the
defendants was only in February, 2011, when the defendants commercially
activated the website www.groupon.in. He submits that the reliance by the
defendants on the Promotion Agreement with Star Hospitality dated 23.12.2009,
will not suffice as use of the mark, as the defendants were not operating from the
website www.groupon.in till February 2011. He submits that the acquisition of the
domain names by the defendant no.1, and the entering into Promotion Agreement
dated 23.12.2009 are merely preparatory steps to establish a business, and do not
qualify as "use" of the mark. He further submits that, at the earliest, the defendants
can be said to have established use of the mark in December 2010, when they sold
their first coupon from www.groupoff.com. Mr. Jain submits that the decision
89
in Hardie Trading (supra) relied upon by the defendants has been distinguished
in Pioneer Nuts And Bolts Pvt. Ltd., Vs. Goodwill Enterprises, 2009 (163) DLT
209 (DB).
The decision in Yahoo (supra) squarely applies to the facts of the

present case. An average consumer with imperfect recollection is bound to
associate the domain names of the defendants as those belonging to the plaintiff,
thereby believing that the services being offered by the defendant under the
impugned mark are those of the plaintiff. Furthermore, the plaintiff is known to
operate from country specific domain names such as www.groupon.sg in
Singapore, www.groupon.ca in Canada, www.groupon.kr in Korea,
www.groupon.jp in Japan amongst others. Therefore there is an extremely high
likelihood that the website of the defendants www.groupon.in will be
misconstrued to be the plaintiff‟s website in India.
At the prima facie stage, this Court does not wish to delve into the
merits of whether the impugned mark and domain names were adopted by the
defendants with a mala fide intention as that is an aspect requiring consideration
of evidence, which is yet to be led. Suffice to say, as observed in Laxmikant V.
Patel Vs. Chetanbhai Shah & Anr., 2002 (3) SCC 65, in a passing off action, the
plaintiff must prove a prima facie case, availability of balance of convenience in
his favour, and his suffering an irreparable injury in the absence of grant of
injunction. Relying on the observations by Christopher Wadlow in "Law of
Passing Off" (1995 Edition, at p.3.06), the Court further observed that the
defendant's state of mind is wholly irrelevant to the existence of the cause of
action for passing off, though proof of fraud may materially assist the plaintiff in
establishing probability of deception.
I may also observe that as laid down in Laxmikant V. Patel (supra),

besides the aforemtioned factors, this Court is also to consider the way in which
the business may be carried on in the future, and where the probability of
confusion exists, an injunction must be granted.
90
In view of the aforesaid discussion, I am satisfied that the plaintiff
has proved a prima facie case and balance of convenience in his favour on account
of prior use and trans border reputation of its mark. This Court also feels that there
is a high degree of likelihood of the plaintiff suffering irreparable injury given the
vast existing subscriber base of the plaintiff which may be confused into
associating the services offered by the defendants to be those offered by the
plaintiff.
Accordingly, the plaintiff‟s application under Order 39, Rule 1 &

2 CPC is allowed and order dated 27.05.2011 is confirmed till the final disposal of
the suit. The defendants‟ application under Order 39, Rule 4 is dismissed.
Summary – Here in the chapter –4 we have studied about various

judicial cases that are basically based on the e-Commerce and consumer
protection act in india.
In the next chapter – 4 we will conclude the conclusion..
CHAPTER - 5
CONCLUSIONS AND RECOMMENDATIONS
5.1 Conclusion and Recommendations
There are three major problems are confronting the consumer in

India. The first problem concerns active functioning of the Consumer Forums
throughout the country. Notwithstanding the fact that these Forums have now
been established, by and large, throughout the country, consumer activists and
organizations have been repeatedly voicing their grievances against the smooth
functioning of these Forums. They argue that these Forums have also started
behaving like Civil Courts and are likely to have mounting arrears soon. In
addition, these Forums still lack basic infrastructural facilities. The members sit
91
only part-time and 90 days decision- making requirement is not strictly adhered
to. There are also ego and status problems between judicial members and the
members with non-judicial background. Another significant problem is that the
stay orders from the High Courts have begun to hold up a large number of cases
filed before the Consumer Forums, thereby denying the benefits of speedy and
inexpensive redressal machinery promised under the Consumer protection Act,
1986.
The second problem concerns the applicability of the Consumer

protection Act, 1986 to various services. As is evident, ever since the
implementation of the 1986 Act, whereas there has hardly been any significant
case in which the ‘goods’ has been vehemently contested, there is a voluminous
amount of case law which involved determination of the meaning, definition, and
ambit of the term ‘service’. Consumer Protection Act, 1986 Act categorizes
certain specific types of services which include
1. banking
2. financing
3. insurance
4. transport
5. amusement
6. entertainment
The definition of the term ‘service’ had already been kept very
wide and now with the inclusion of the two terms ‘housing and construction’ by
the Consumer Protection (Amendment) Act, 1993, it has been further widened.
Only two types of services have been kept out of the ambit of the 1986 Act. They
are services rendered free of charge and services rendered under a contract of
personal service. The non-mentioning of services like education, health, housing,
posts and telegraphs and telecommunications had presumably given these services
an impression of their exclusion from the ambit of this legislation. At the initial
stages, therefore, these services contested the jurisdiction of the 1986 Act, thereby
92
claiming complete immunity from their Commerce by it. The Consumer Forums,
however, have appreciably stood the test of time and have brought all these
services within the ambit of the 1986 Act.
Making consumers aware of their rights and taking consumer

movement to the rural India is the third and perhaps the most important problem
and a challenge before the consumer organizations. As is well known, most
consumers are still ignorant of their rights, much less of being assertive about
them. Though the Government appears to be serious of this issue, much however
depends upon the consumer organizations. They have still to cover a very long
distance so far as taking the movement to rural areas is concerned.
We, therefore, concluded that even though the Consumer is in a

dominant position with respect to numerous choices of products and services
available in the market due to fierce competition between the companies, he is still
in a vulnerable position. Consumers as a class can be called as King but an
individual consumer barely enjoys such a status. The king, in this case, is
vulnerable and requires protection form unfair trade practices.
The efficient and effective program of Consumer Protection is of

special significance to all of us because we all are consumers. Even a
manufacturer or provider of a service is a consumer of some other goods or
services. If both the producers/providers and consumers realize the need for co-
existence, adulterated products, spurious goods and other deficiencies in services
would become a thing of the past. The active involvement and participation from
all quarters i.e. the central and state governments, the educational Institutions, the
NGO’s, the print and electronic media and the adoption and observance of a
voluntary code of conduct by the trade and industry and the citizen’s charter by
the service providers is necessary to see that the consumers get their due. The
need of the hour is for total commitment to the consumer cause and social
responsiveness to consumer needs. This should, however, proceed in a
93
harmonious manner so that our society becomes a better place for all of us to live
in.
1. Addition of substances in food material which are injurious to health or

removal of substances which are nutritious to health or by lowering their
quality standards.
2. Improper delivery of after sales services, supply of defective goods,
hidden price component, production of low quality goods in bulk
quantities, Use of deceptive or incorrect rates on products
3. Illegal fixation of Maximum Retail Price (MRP)
4. Selling above the MRP
5. Non-compliance with the terms and conditions of sales and services
6. Supply of false or incomplete information regarding the product
7. Poor customer services
8. Non-fulfillment of guarantee or warrantee
All such issues and problems must be handled more efficiently

both at the Centre and the
State level, with a view to protect the interests of the consumers

and promote their welfare.
Institutions, which are the mechanisms of actualizing both

democracy and development, need drastic reforms at all the levels of the
Commerce. Good Commerce cannot be achieved in isolation, all the players have
to unanimously strive towards a common goal in order to initiate change. There is
no dearth of serious concerns, debates and proposals about various reforms, from
parliament to judiciary, the executive and local Commerce, but implementation
machinery of ours performs not up to the potential and that is where our constructs
get really blurred. If we need some significant changes to be visible, we need to
spend resources, and strengthen the implementing machinery, creating feedback
loops through ordinary citizens and be responsive to their concerns. Commerce
94
systems should follow a cyclical mechanism rather than the top to down
enforcement which we have seen for ages.
In order to bring change aspirations need to circulate through all

the channels and make their presence felt, on the other hand the state should be
responsive to the aspirations. The electronic Commerce systems are a small tool in
the process which will certainly improve this communication grid. We need to
invest our resources, energy on these tools also to achieve the larger objective.
The projects like LokMitra should be promoted to a large extent up so that those
who are alienated from the mainstream processes can at least assert their needs
and aspirations. It is necessary to have a dialogue in a democracy and effective
channels of communication are a must for the success of a democracy. Internet has
evolved as a strong medium for the same, we need to integrate it with our
Commerce processes and public delivery mechanisms for an effective
administration.
The CSC is a great effort by government of India in making

government services more accessible and introducing transparency in the entire
system. However it has been observed that most e-Commerce suffer delay and
encounter failure as the implementation agencies lack guidance in the area of
planning and implementation of e-government projects. The investment in the e-
Commerce project tend to produce below par results in the absence of the standard
methods also. It is therefore critical to have suitable policies, guidelines and
specifications well laid out to overcome the problems associated with planning
and implementation of e-government project.
At the same time the Kendras are being rolled out connectivity
options should be provided to them because in this project the basic service
delivery requires internet connectivity.
It was seen in our study that with the SCAs that those who have
made complete initial investment without letting the VLE to take loan from the
bank have been more successful in making the Kendras more sustainable.
95
In our study came out that the different SCAs are following
different methods for the sustainability of the project. Therefore it is suggested
that effort should be made to share the knowledge among the various agencies in
order to make the project more successful.
For success of an e-Commerce project and superior service

delivery, it is imperative that the government agencies focus on whole citizen
experience. Focusing on the citizen is essential for long term success. The govt.
agencies need to integrate information from all points of citizen interaction. The
overall architecture for e-Commerce needs to ensure that the architecture
components are extensible and scalable to adapt to the changing environments.
The real challenges are how to develop and sustain successful e-Commerce
projects and deliver state of the art e-services to citizens. Unfortunately it‘s not as
easy as adding “e” in front of your service delivery mechanism. Successful e-
Commerce initiatives can never be taken in haste. Particularly for the democratic
nation of the billion people like India, e-Commerce should enable seamless access
to information and seamless flow of information across the state and central
government in the federal setup. No country has so far implemented an e-
Commerce system for one billion people.
Some of the requirements for implementing successful e-

Commerce across the state are
E-Commerce framework across the nation with enough bandwidth

to service a population of sixty five lacks.
Connectivity framework for making the services reaches rural areas

of the state or development of alternative means of services such as e-Commerce
kiosks in all region languages.
State Citizen Database which is the primary unit of data for all
Commerce vertical and horizontal applications across the state and central
governments.
96
E-Commerce and interoperability standards for the exchange of
secure information with non-repudiation, across the state and central government
departments seamlessly.
A secure delivery framework by means of virtual private

network connecting across the state and central government departments.
Datacentres in centre and states to handle the departmental workflow automation,
collaboration, interaction, exchange of information with authentication.
Only with an honest effort and involvement from all the

stakeholders of the project will the Lok Mitra initiative be able to achieve what it
had set out to do – to develop a platform that can enable the government, social
and private sector organizations to integrate their commercial and social goals for
the benefits of the benefits of the rural population in the remotest corners of the
state through a combination of IT as well no IT services.
The Consumer Protection Act refers to the measures taken to

protect consumers from unprincipled and unethical misconduct by the business
and provide them quick redressal of their grievances. This Act is for the protection
of the interest and rights of the consumer, and this spirit has been reflected in its
provisions.
The inclusion of e-commerce has broadened the Act’s scope,

making it easier for the consumer to hold food aggregators responsible for
violating their rights.
The Consumer Protection Act, 2019 is a modified piece of

legislation that offers the consumers a great variety of benefits and rights to
protect them from unfair trade practices, false or misleading advertisements, etc.
The Act enables the consumers to seek alternative dispute resolution mechanisms
and mediation so that the parties can opt for speedy and effective settlement of
consumer disputes. The scope of e-filing of complaints and e-consumers in the
Act portrays forward-thinking in part of the legislature. Furthermore, the Act also
97
introduced new terms such as product liability, unfair contracts, etc. thereby
widening the scope of protection of consumer rights and enabling the consumers
to file complaints when their rights have been violated under the Act.
Thus, the inclusion of the provisions in this fills up the lacunae in

the Consumer Protection Act, 1986. The enactment of the Act was paramount and
it changed the ambit of protecting the rights of consumers in the country.
BIBLIOGRAPHY
Books
1. Consumer rights in tha Era of e-commerce: by Hammam Waheed

2. Consumerism and Consumer Protection in India : by P. K. Dutta
3. Consumer Rights and Protection in India : by Mohammed Kamalun Nabi
98
4. Taxmann's Consumer Protection Law & Practice – Comprehensive 250+
Pages Commentary along with Compilation of Amended, Updated &
Annotated text of Consumer Protection Laws in India: by Taxmann
Websites
1. www.google.com
2. www.wikipedia.com
3. www.indiankanoon.org
4. www.legalservices.in
5. www.indiatoday.com
Article
1. "Lok Sabha passes Consumer Protection Bill to enforce consumer

rights". India Today. Retrieved 14 August 2019.
2. "Five new rights you now get as a consumer - Times of India". The Times
of India.
3. "Consumer Protection Act, 2019" (PDF). Department of Consumer Affairs,
Ministry of Consumer Affairs, Food & Public Distribution, Government of
India. Retrieved 25 July 2020.
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Ministry of Consumer Affairs, Food & Public Distribution, Government of
India. Retrieved 25 July 2020.
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from the original on 16 September 2020. Retrieved 13 September 2020.
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for e-tailers". Hindustan Times. Retrieved 27 July 2020.
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December 2020.
8. Van Loo, Rory (1 November 2019). "Broadening Consumer Law:
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California Department of Consumer Affairs". www.dca.ca.gov. California
Department of Consumer Affairs. September 2010.
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Prospects”, Postmodern Openings, 7,(9), pp.157-182,2011
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Implementation of the United Nations Guidelines for Consumer
Protection, 1985 in India”, Jaipur, India; Consumer Unity and Trust
Society, with the support of Consumer Welfare Fund, India2001.
12. Harland, D, “The United Nations guidelines for consumer protection”,
Journal of Consumer Policy, Vol. 10 (3), pp. 245-66,1987
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Business Review, May/Jun, Vol. 50 Issue 3, p48,10p
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50 years of Independence”, 3rd Edition, New Delhi, Allied Publishers,1998.
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Paswan” Economic Times, January 31 2016
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Commonwealth Law Bulletin, 11(1) pp 24- 248,1985
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100

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CHAPTER – 1

The concept of consumer protection is a thought as old as human

Consumer Protection is a socio-economic day to day activity that is

This study is based on secondary data. This paper analyses the

Consumer protection measures are often established by law. Such

Consumer protection is linked to the idea of consumer rights and to

A consumer is defined as someone who acquires goods or services

1. The right to satisfaction of basic needs

Consumer protection law or consumer law is considered as an area

In India, consumer protection is specified in The Consumer

Indian Contract Act, 1872 lays down the conditions in which

The Agriculture Produce Act of 1937 act provides grade standards

Consumer protection is the practice of safeguarding buyers of

In India, the protection of the rights of the consumers is

India’s enormity, diversity and distinctive cultural fabric have

The Indian Government’s National e-Commerce Plan aims, among

The National Informatics Centre (NIC), a part of the Government

In 2006, India launched its new National e-Commerce Plan. It dealt

When fully implemented, CSCs will provide assisted access to

The State Wide Area Networks (SWAN) and State Data

Summary – Here in the chapter – 1 we have studied the basic

introduction about the e-Commerce and consumer protection in India.

In the next chapter – 2 we will study about the history of consumer

HISTORY OF CONSUMER PROTECTION 1986 TO 2019.

Consumer protection in India has been a part of its culture and

The Consumer Protection Act, 1986 (COPRA) was an Act by

The industrial revolution and the development in international trade

The advertisements of goods and services in television, newspapers

2.2 Consumer Protection Act, 2019

The Consumer Protection Act, 2019 was introduced in the Lok

The bill received assent from President Ram Nath Kovind on 9

The Act features focuses on giving customer more power by taking

The concept of consumer protection against unscrupulous, unfair

2.4 Medieval period and Pre-independence

2.5 The modern and British times

British rulers combined the previous customs and culture (dharma)

1. They introduced Acts like:

2.6 Post Independence

After independence, many laws were enacted in India for

1. The Drugs Control act, 1950

2.7 Consumer Protection Act, 1986

The industrial revolution and the development in the international

An Act to provide for better protection of the interests of

Summary – Here in the chapter – 2 we have studied about the

In the next chapter – 3 we will study about Consumer protection

act 1986 and CPA 2019.

CONSUMER PROTECTION ACT 1986 AND 2019

3.1 Consumer Protection Act, 1986

The consumer protection act 1986 notes give detailed information

Consumer Protection Act 1986 was enacted for superior protection

To safeguard the interests and rights of consumers, quasi-judicial

3.2 What is the Consumer?

Consumer refers to persons or households that use goods and

3.3 Concept of Consumer Protection

3.4 Features of Consumer Protection Act, 1986

1. It applies to all goods, services and inequitable trade practices unless

3.5 Need for Consumer Protection Act

The necessity of acquiring measures to protect the interest of

Social Responsibility: It is the moral responsibility of the business

Consumer Satisfaction: The Father of the Nation, Mahatma

Survival and Growth of Business: Businesses have to be in the

Principle of Trusteeship: Resources/Assets were contributed by

3.6 Rights of the Consumer

Right to Safety – To be secured against the marketing of goods on