The Central Consumer Protection Authority (CCPA) has levied a ₹10 lakh fine on Dial4Trade Technologies Private Limited, an online marketplace, for listing ammonium nitrate without proper verification of licenses or warning potential buyers of the restrictions associated with its purchase and possession. This substance is classified as a regulated explosive under Indian law.
CCPA’s Findings and Rationale
The ruling was delivered by a coram comprising Chief Commissioner Nidhi Khare and Commissioner Anupam Mishra. The CCPA found that the product listing included images depicting explosions and blast effects, which were intended to attract consumer attention by showcasing the destructive potential of ammonium nitrate. The order noted that such imagery served to highlight the hazardous nature of the product, drawing undue consumer interest.
An inquiry initiated by the CCPA focused on the online availability of hazardous chemicals and explosives such as ammonium nitrate, gunpowder, picric acid, and pentaerythritol tetranitrate. During this investigation, it was discovered that ammonium nitrate was listed on Dial4Trade without details of the seller’s Petroleum and Explosives Safety Organisation (PESO) license, any verification of buyer eligibility, or mechanisms to trace sales transactions. The listing provided information on pricing, packaging, and included a “contact supplier” option, but failed to inform potential buyers of the legal requirement for a valid license to purchase the substance.
Dial4Trade’s Defense and CCPA’s Response
Dial4Trade defended its actions by asserting that it operates solely as a business-to-business (B2B) marketplace and does not engage in the manufacturing, storing, distributing, or selling of any products. The company claimed that the listing in question was uploaded by an independent seller without its direct knowledge. However, the CCPA countered that this defense actually demonstrated the lack of supervision on the platform, highlighting that anyone could list hazardous products without oversight.
The Authority stated that even a legitimate B2B marketplace must comply with the Consumer Protection Act and the Consumer Protection (E-Commerce) Rules. Furthermore, the CCPA dismissed Dial4Trade’s claim of intermediary safe-harbour protection under Section 79 of the Information Technology Act, citing the company’s failure to establish effective mechanisms for preventing the listing of regulated substances.
Conclusion and Penalties
The CCPA noted Dial4Trade’s failure to report the seller to the police or PESO or to provide data on the quantities sold and licenses verified. The Authority concluded that the listing constituted a misleading advertisement and an unfair trade practice, violating consumers’ right to protection against hazardous goods. Consequently, Dial4Trade was ordered to cease all listings of ammonium nitrate and other regulated explosives immediately and provide a compliance report within 15 days. Additionally, a fine of ₹1 lakh was imposed for these violations.
Dial4Trade was represented by Advocate Hemant Verma in the proceedings. [Read Order]
