New Delhi: CCPA imposed a ₹10 lakh penalty on Dial4Trade Technologies Private Limited for unsafe online listings of Ammonium Nitrate. The authority found that the platform lacked key legal safeguards for the regulated substance.
The Central Consumer Protection Authority passed the final order under Sections 10, 20 and 21 of the Consumer Protection Act, 2019. Chief Commissioner Nidhi Khare and Commissioner Anupam Mishra headed the authority during the action.
The CCPA also ordered Dial4Trade to immediately stop listing, hosting, advertising or facilitating sales of Ammonium Nitrate. The direction also covered any substance classified as an explosive under the Explosives Act, 1884.
During its examination, the authority found that the platform did not adequately verify sellers’ licences. It also found no proper checks on buyer identity and eligibility before purchase.
In addition, the platform lacked mechanisms to ensure transaction traceability under the Ammonium Nitrate Rules, 2012. The listings also failed to warn users about legal restrictions on possession and use.
The CCPA noted that some listings used images showing explosions and blast effects. According to the authority, such images could attract attention to the product instead of highlighting its regulated and hazardous nature.
Dial4Trade penalty linked to missing checks
The CCPA held that an online product listing shown to the public qualifies as an advertisement under the Consumer Protection Act, 2019. Therefore, presenting a regulated substance like an ordinary consumer product could amount to a misleading advertisement.
The authority also treated the practice as an unfair trade practice under Sections 2(28) and 2(47) of the Act. It rejected Dial4Trade’s claim that it operated only as a Business-to-Business marketplace intermediary.
The CCPA noted that buyers could purchase the substance in quantities as low as one unit. Moreover, the platform did not require a minimum order quantity or verify institutional buyers.
The authority also said the Consumer Protection (E-Commerce) Rules, 2020 apply to marketplace e-commerce entities. This applies regardless of how a platform defines its business model.
Dial4Trade also relied on intermediary safe-harbour protection under Section 79 of the Information Technology Act, 2000. However, the CCPA said that protection depends on compliance with due-diligence requirements.
The authority found that removing listings only after detecting violations was not enough. It said regulated and hazardous substances require checks at the listing stage itself.
The CCPA further noted that Dial4Trade could block sellers and remove products. This showed that the platform exercised control over content hosted on its marketplace.
The Dial4Trade penalty formed part of a wider CCPA examination of online platforms. The probe covered the unauthorised online sale of hazardous chemicals, explosive substances and related precursors.
The substances under examination included Ammonium Nitrate, Gun Powder, Picric Acid and Pentaerythritol Tetranitrate (PETN). The platforms under examination included India MART, Justdial, Sigma-Aldrich India and Exporters India.
The list also included Ibuychemikals, Alpha Chemika and TradeIndia. The CCPA said its examination of these platforms remained ongoing.
The authority stressed that Ammonium Nitrate is a regulated substance. It said unauthorised sale or possession without required safeguards could create risks to public safety.
The CCPA also said consumers rely on online listings and product descriptions when making purchases. Therefore, e-commerce platforms must carry out suitable checks for regulated products.
The authority reaffirmed its focus on consumer rights and fair trade practices. It also stressed stronger compliance by online marketplaces dealing with regulated and hazardous products.
