With the rapid development of digital technologies and the increasing penetration of e-commerce, smart phones, cloud and Internet, there is a change in how the Indian consumers are buying products. The Internet, mainly the World Wide Web (www) as an electronic medium of exchange, and mobile phones, have given rise to a de-territorial, virtual market place, and the sales in the business-to-consumer segment has been increasing manifold over the past few years. Use of smartphones is the game changer in the digital market in India, and one out of three customers currently, makes transactions using mobiles. A study by ASSOCHAM reports that in 2017 there has been a large-scale growth in the Indian e-commerce sector, and the number of consumers who bought online has reached 100 million.
In India, cash on delivery is the most preferred payment method, accounting for 75% of the e-retail activities. The new age digital consumers often engage with an interactive marketplace characterised by high levels of heterogeneity, and therefore, have to be digitally enabled. Convenience, better prices, speedy, less expensive products and services, comparison of prices, aggressive online discounts, rising fuel prices, wider abundant choice, and crowd free shopping are some of the benefits which consumers enjoy while shopping online. Consumers can shop or conduct their transactions 24 hours a day, and also track the delivery status of their purchases. Increasing Internet and mobile penetration, growing acceptability of digital payments and favourable demographics have provided the unique opportunity for companies to connect with Indian consumers. But shopping online sometimes poses problems related to cross-border transactions, risk of poor quality and unsafe products, predatory prices, exploitative and unfair trade practices.
The new challenges
As online shopping poses new challenges amongst consumers, creating awareness and empowering them is required to prevent consumer detriment, besides rendering the grievance redressal process less complex, time consuming, and expensive. If a consumer has been cheated while doing e-commerce, he can file a complaint under the Consumer Protection Act (CPA), 1986, or if his account has been hacked or private information misused, then he can lodge a complaint under the IT Act, 2000. In digital purchasing, since proposal and acceptances are made on computers mostly in one’s home or office, jurisdiction at both the places has been considered by the consumer forums under the Consumer Protection Act. Hence, consumers can easily reach consumer forums in cases of default on the part of e-retailers or e-service providers.
Nature of problems faced by online consumers
The e-commerce industry is seeing a huge growth and is not restricted to buying of tickets online, or booking of hotels or transport, but these days from books to gadgets such as laptops, mobile phones, clothes and electronic products are bought online. Since the consumer cannot check or verify the claimed features of the product or service by the website, he has to rely on the representation of the e-portals, and often, he makes the payment even before receiving the product. Further, the consumer very rarely has the address of the seller, and sometimes has no means to verify the address mentioned on the website. Some of the frequently reported problems faced by digital consumers are:
Seeking redressal under The Consumer Protection Act, 1986
The Consumer Protection Act, 1986, is a benevolent Act, and the main object is to provide speedy and simple dispute redressal mechanism, free from hassle. An aggrieved consumer can file a complaint and seek compensation in consumer forums regarding any defective product or deficiency in service or unfair trade practice of a product bought from an e-portal. The Act provides a legislative framework for better protection of the interests of the consumer by creating a formal but three-tier, quasi-judicial consumer dispute redress machinery at the national, state and district levels, aimed at providing simple, speedy and affordable redress to consumers. As on date, 644 District fora, 35 State Commissions and the National Commission at the apex level are functioning in the country. In the Spicejet Ltd. Vs Ranju Aery case, the consumer forum came to the rescue of the consumer when the airline was found to be deficient in its service, and the question of territorial jurisdiction arose.
Cyber crimes and IT Act, 2000
The Information Technology Act, 2000, has given tremendous recognition to online purchases. The Reserve Bank of India (RBI), by issuing various circulars regarding online banking and money transfer activities, has made consumers capable of securing the online space. Section 10A of the Information Technology Act, 2000 (“IT Act”) provides validity to e-contracts.The Hon’ble Supreme Court of India, in the Trimex International FZE Limited Dubai v/s. Vedanta Aluminum Limited 2010 (1) S C 574, recognised the validity of online transactions and held that emails exchanged between the parties regarding mutual obligations constitute a contract.
Under Section 43A of the Information Technology (Intermediaries Guidelines) Rules, 2011, the intermediaries have the obligation to publish the rules and regulations, privacy policy and user agreement for access or usage of the intermediary’s computer resource by any person. Such rules and regulations must inform the users of computer, display, upload, modify, publish, transmit, update or share information.
Also, the intermediary must not knowingly host or publish any prohibited information, and if done, should remove them within 36 hours of its knowledge. In Consim Info Pvt. Ltd v/s Google India Pvt. Ltd., in the Delhi Court, Google had extended the argument that being a search engine, they cannot control the fact whether some website, any advertisement given on their site is genuine or fraud. The court then observed that though the intermediary, Google, cannot be made liable for infringement arising out of a third party’s actions since it is not possible to always check every advertisement posted online, however, as per section 3(4) of the aforesaid Intermediaries Guidelines, Google had to act upon it within 36 hours of receipt of such complaint, failing which it may be held liable.
Section 65 of the IT Act deals with tampering with computer source documents, Section 66-consists of computer related offences, Section 66A involves punishment for sending offensive messages through communication service. Section 66B involves punishment for dishonestly receiving stolen computer resource or communication device. Section 66C deals with punishment for identity theft, and Section 66D mentions punishment for cheating by personation by using a computer resource. Section 66E gives punishment for violation of privacy without the consent of the person. The punishment for the offender may extend to three years or a fine which may extend to one lakh or both.
Being a vigilant consumer
While doing online shopping, consumers should take adequate care in order to avoid being cheated. Consumers should use strong passwords, take complete information about the e-portal, find out about the e-merchant’s privacy policy, read carefully the return policy and procedure, keep personal information private, shop only with known e-merchants, and review monthly bank and credit card details. When a site offers products that are heavily discounted, contains bad grammar and misspellings, and uses low quality images of the brand owner’s official site, it might be selling spurious and counterfeits. Consumers should use a payment method with buyer protection, keep a record of the transactions, read the fine print carefully, avoid hacked sites, typesensitive web addresses into their browser’s address bar, and only send information over secure connections checking for addresses having https/: addresses. Shopping at a secured website means that the connection is encrypted, and hence more resistant to snooping or tampering. Consumers should always print the copy of their order and keep the acknowledgement safely.
Thus, a high level of consumer awareness and protection in every strata of the society is required so that digital purchases are done by consumers safely, and they are not lured by fly by night operators.
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Dr. Sheetal Kapoor
Dr. Sheetal Kapoor is Associate Professor, Department of Commerce, Kamala Nehru College, University of Delhi. [/column]