The Central Consumer Protection Authority (CCPA) has imposed penalties of ₹10 lakh each on Amazon and Flipkart, and ₹5 lakh on JioMart, for selling and advertising an unregistered agro-chemical product called ‘Cyclosinone Herbicide’ on their platforms.
In a separate order dated September 22, the consumer protection regulator directed the three e-commerce companies to immediately discontinue the sale and advertisement of the product, which it found was being marketed without disclosing the chemical name of its active ingredient or its composition.
The CCPA also directed the platforms to conduct a self-audit to prevent listings of products that contravene existing law or pose a hazard to consumer safety, and asked them to submit compliance reports within 15 days of the order.
The investigation was triggered after the CCPA received a complaint forwarded by the Union Ministry of Agriculture, originally filed by the Crop Care Federation of India (CCFI).
During the probe, the Agriculture Ministry informed the CCPA that no chemical by the name “Cyclosinone” is listed in the Schedule to the Insecticides Act, 1968, meaning the product’s sale and marketing bypassed mandatory safety, bio-efficacy, quality and legal checks required under the law.
The CCPA noted that the marketplaces had not carried out adequate independent verification of the product’s regulatory status before allowing the listings to go live.
In its order against Amazon, the regulator cited 38,410 orders involving 43,634 units, with an aggregate sale value of ₹96,42,572/- as evidence of the scale of consumer exposure and the misleading impression created among buyers.
Rejecting the platforms’ defence that compliance responsibility lay contractually with individual sellers, the CCPA held that a private arrangement between a marketplace and its sellers cannot override statutory obligations imposed by Parliament or delegated legislation meant to protect consumers.
It said the very requirement of obtaining a seller undertaking shows that the marketplace itself carries a compliance obligation, and it is not enough to merely point to contractual terms with sellers.
The regulator also invoked Rule 4(3) of the E-Commerce Rules, which bars e-commerce entities from adopting unfair trade practices in the course of business.
“Sellers may submit false or incomplete declarations in order to list their products. Therefore, relying only on self-declaration is inadequate. It reflects gross negligence and deficiencies in the Opposite Party’s seller onboarding procedures, product verification and content moderation mechanisms,” the CCPA observed.
The regulator clarified that it was not assuming jurisdiction over the manufacture, composition or scientific properties of the product – a domain that falls under other authorities.
Its order, it said, was confined to examining the conduct of the e-commerce entities on counts of consumer rights violations, misleading advertisements and unfair trade practices, matters that fall within its statutory mandate.
