Karnataka Challenges Snapdeal's Safe Harbor Protection in Pill Sale Case

The Karnataka government has approached the Supreme Court challenging a lower court's decision to quash criminal proceedings against e-commerce platform Snapdeal and its co-founders. The charges relate to the alleged sale of prescription erectile dysfunction pills via the platform without valid licenses or doctor's prescriptions.

Karnataka alleges that a third-party seller, Herbal Healthcare, sold Suhagra-100 tablets through Snapdeal's marketplace. The state contends that the drug, used to treat erectile dysfunction, is a Schedule H prescription medicine that can only be sold on a doctor's prescription.

Snapdeal and its founders stand accused of enabling and supplying this drug in contravention of India's Drugs and Cosmetics Act, 1940. The core of the state's appeal is that Section 79 of the IT Act, which provides 'safe harbor' protection for intermediaries, should not override public health laws. Karnataka argues that this protection should not shield platforms from prosecution under regulations designed to protect public health.

Furthermore, the Karnataka government claims that even if Section 79 were applicable, Snapdeal failed to exercise due diligence by allowing the online sale of a prescription drug without ensuring legal compliance. The Supreme Court has issued a notice to Snapdeal and sought responses.

This legal challenge revisits a previous ruling by the Karnataka High Court in 2021, which had dismissed the criminal case. The High Court had then stated that Snapdeal, as an intermediary, was entitled to safe harbor protection and had exercised the necessary due diligence, absolving the platform and its directors from liability for third-party seller actions.