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Determining Jurisdiction of a Court while making Purchase from E-Commerce Platforms

 > Consumer Laws  > Determining Jurisdiction of a Court while making Purchase from E-Commerce Platforms

Determining Jurisdiction of a Court while making Purchase from E-Commerce Platforms

An e-commerce entity has its Corporate Office in Gurugram, Haryana but according to the terms and conditions, all disputes arising shall be subject to the jurisdiction of the court, tribunal and forum in Bengaluru. In such cases, if the aggrieved person residing in Delhi has to file a complaint against the spurious product and ill refund policy of the e-commerce entity at his residence itself, the same becomes challenging. It is therefore important to understand, as to what needs to done if the person desires to file the complaint in Delhi itself. Now, under section 11(2) of the Consumer Protection Act, 1986, for instituting a complaint, it is necessary the following essentials are met, which are as follows: –

  1. The complaint shall be instituted in the jurisdiction of the opposite party, or each of the parties voluntarily residing or carrying on business, or have a branch office or individually working for gain,
  2. Now in the case of more than one opposite parties, it is important that there should either be permission of the District forum, or the consent of such opposite party who do not reside or carry on business, or have a branch office or individually work for gain,
  3. The complaint can also be instituted in the jurisdiction where the whole, or in parts the cause of action arose.

Case Laws- Discussing the issue of jurisdiction of complaint in cases involving online transaction: –
Notwithstanding, the restriction to the territorial jurisdiction made in the Consumer Protection Act, 1986, there are few judgements passed by different courts and tribunals in India allowing the buyer to file the complaint at the place of his residence. In World Wrestling Entertainment v. M/s Reshma Collection & Others, FAO(OS) Number 506/2013 & CM Number 17627/2013, the issue before the Hon’ble Delhi High Court was whether the court had territorial jurisdiction to try the suit since the opposite party resided in the UAE. The court held that although the opposite party does have its business and the overall territorial jurisdiction in Delhi, yet the defendants are offering fitness app through App Store, Google Play Store and also e-commerce site, amazon.com which is accessible throughout the country including Delhi. Therefore, the court has the territorial jurisdiction to try and decide the current suit.

In another case, the Hon’ble Supreme Court of India in Trimex International FZE Limited, Dubai v. Vedanta Aluminium Limited, 2010 (1) SCALE 574, held that in an online transaction, sales and offers are made on computer between parties at respective places. Therefore, jurisdiction at both the places is to be considered in order to make the consumer easily approach the Consumer Forum under the Consumer Protection Act. It may be noted that while dealing the issue under the Consumer Protection Act, the jurisdiction of the Fora should be decided considering the place where the cause of action arose. According to the court, this is the only rational approach to solve the issue of jurisdiction over transaction made through Internet.

In the year 2017, the Hon’ble Supreme Court of India provided a sigh of relief to the online consumers by allowing them to sue a corporate for lack of service at any consumer court of their choice. A bench of Justices Adarsh Goel and Abdul Nazeer in Ranju Aery v. Spicejet Limited, (2017) CPJ 1 (NC), upheld the judgement pronounced by the National Consumer Dispute Redressal Commission that notwithstanding the fact that whether or not the contract is built over the internet, cause of action would continue to arise at any of the following places, namely, where the contract is to be performed or is performed, a place where monetary payment is either payable or paid and lastly where contract’s repudiation is received. Now, it cannot be disputed that a consumer forum is competent is receive complaint even though only an infinitesimal part of the cause of action arose within its jurisdiction. As a consequence, a consumer forum located at any place shall hold the jurisdiction to entertain a complaint subject to the condition that the case fulfils the conditions for cause of action mentioned above.

In Spicejet Limited v. Sanyam Aggarwal, First Appeal Number 515/2016, the State Consumer Disputes Redressal Commission, Chandigarh, clearly observed the question of jurisdiction in cases of online transactions. According to the court, website transaction involves broad categories of facts and associated causes of actions. And further, jurisdiction is generally based on the grounds of domicile, contract and relevant tort for the purpose. The Hon’ble Supreme Court of India in Lucknow Development Authority v. M.K Gupta (AIR 1994 SC 787), it was particularly stated that the provision of the Consumer Protection Act shall be construed in favour of the consumers in order to achieve the objective of the enactment, for the same is a social good centric legislation.

Changes made in the new Consumer Protection Act, 2019
However, with the introduction of the new Consumer Protection (Amendment) Act, 2019, the territorial jurisdiction clause has been enhanced under Section 34(2) of the Consumer Protection Act. The change provides that the complainant can now file a complaint in the place where the same resides or personally carries out work for gain. This new enhancement is helpful to those customers who do not possess branch for grievances redressal forum in their state. Notwithstanding, its introduction in the act, this section is yet to be enforced by the Ministry of Consumer Affairs. With the arrival of new act, three new practices branded as, “Unfair trade practices” have been added in the act. These include, failure on the part of the opposite party to issue a bill or receipt to the consumer, refusal to return and accept the goods within the span of thirty days from the consumer and lastly to disclose the personal and confidential information unless important under law or in public interest. Also, under the new act, E-commerce would be dealt under the purview of Consumer law and the Central Government shall be empowered to frame rules for regulating the same. However, it may be noted that those rules are yet to be notified.
Authored By: Adv. Anant Sharma & Aniket Pandey

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