CCPA fines Flipkart Rs 5 lakh for non-BIS compliant toys
India's Central Consumer Protection Authority (CCPA) has imposed a Rs 5 lakh penalty on Flipkart for facilitating the sale of toys on its platform that did not meet mandatory Bureau of Indian Standards (BIS) requirements.
The Central Consumer Protection Authority (CCPA) in India has fined e-commerce platform Flipkart Internet Private Limited Rs 500,000 (approximately $6,000) for allowing the sale of toys on its platform that failed to comply with mandatory Bureau of Indian Standards (BIS) requirements. The decision penalizes Flipkart for its role in enabling the sale of non-compliant products.
The case stems from the Toys (Quality Control) Order, 2020 (QCO), which made compliance with specified toy standards mandatory from January 1, 2021. CCPA's preliminary inquiry found toys not conforming to these standards being offered for sale on Flipkart. According to information provided by Flipkart, four sellers sold 1,338 such toys after the QCO came into force, generating seller revenue of approximately Rs 5.46 lakh. Flipkart earned about Rs 1.43 lakh in fees from these transactions.
Flipkart had argued that it acted solely as an intermediary and was not liable for the products sold by third-party sellers. The company relied on Section 79 of the Information Technology Act, 2000, which provides conditional protection to intermediaries from liability for third-party content. Flipkart contended that sellers were responsible for product compliance and that the platform was not required to monitor every listing daily. It also stated that it conducted random checks and removed non-compliant products when notified.
However, the CCPA rejected Flipkart's defense, stating that platform-level obligations under the Consumer Protection Act, 2019, and the E-Commerce Rules, 2020, are independent of the intermediary safe harbor provisions under the IT Act. Crucially, the CCPA found that Flipkart had "actual knowledge" that non-compliant toys remained listed and available for sale, yet failed to act. The authority also considered Flipkart's facilitation role, including its use of tags like "Flipkart Assured," which could imply product verification and thus indicate the company was more than a neutral facilitator.