Did CCPA Fine FirstCry Rs 2 Lakh for Misleading Ads?
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Synopsis
The CCPA has levied a hefty fine on FirstCry for misleading price representations, raising critical questions about consumer rights. This decision highlights the importance of transparency and fair practices in e-commerce, impacting both businesses and consumers alike.
Key Takeaways
- CCPA fines FirstCry for misleading pricing.
- Consumers misled by additional GST charges.
- Importance of transparent pricing displayed upfront.
- Changes made to enhance price transparency.
- Drip pricing practices come under scrutiny.
New Delhi, Sep 26 (NationPress) The Central Consumer Protection Authority (CCPA) has recently imposed a fine of Rs 2,00,000 on Digital Age Retail Pvt Ltd (FirstCry) for making false and misleading price claims.
This decision was made under Sections 10, 20, and 21 of the Consumer Protection Act, 2019, due to the publication of misleading advertisements and involvement in unfair trade practices on its e-commerce platform (www.firstcry.com).
The issue arose from a consumer grievance stating that FirstCry presented products with a claim of “MRP inclusive of all taxes,” while an additional GST was applied during the checkout process.
This led to a misleading perception of greater discounts, ultimately confusing consumers about the actual amount due, as noted by the Ministry of Consumer Affairs.
An inquiry, supported by evidence from the National Consumer Helpline (NCH), revealed that advertising discounts based on the MRP while separately charging GST on the discounted price significantly diminished the advantages for consumers.
For instance, products advertised with a 27 percent discount were effectively sold at only an 18.2 percent discount once GST was factored in.
Such practices were deemed deceptive pricing and misleading advertising under Section 2(28), alongside unfair trade practices under Section 2(47) of the Consumer Protection Act, 2019.
It was found that disclaimers such as “additional charges may apply” or “GST and additional charges may apply on discounted price” did not meet the legal requirement that the MRP must include all taxes.
By marketing prices as tax-inclusive and subsequently applying GST at checkout, the company engaged in “drip pricing,” a practice deemed misleading under the Guidelines for Prevention and Regulation of Dark Patterns, 2023, which undermined consumer understanding of the final payable amount.
“This behavior also violated Rule 7(1)(e) of the Consumer Protection (E-Commerce) Rules, 2020, which mandates that the total price, inclusive of all fees and taxes, must be displayed clearly upfront,” stated the CCPA.
Consequently, the CCPA mandated the company to amend this practice, ensuring that both original and discounted prices are displayed as inclusive of all taxes, with any extra charges plainly stated.
Following the CCPA’s intervention, the company has adjusted its platform for increased transparency in price displays throughout its website and mobile application.
A significant disclaimer stating ‘price inclusive of all taxes’ is now prominently shown on all pages of the company's website and mobile app.
Point of View
My perspective on this matter aligns with our commitment to consumer rights. The CCPA's decisive action against FirstCry underscores the need for transparency in advertising. Consumers must be well-informed to make sound purchasing decisions, and this fine is a step towards ensuring businesses adhere to fair trading practices.
NationPress
26/09/2025
Frequently Asked Questions
What was the reason behind the CCPA's fine on FirstCry?
The CCPA fined FirstCry for making false and misleading price representations, particularly regarding the display of prices that did not accurately reflect the final payable amount after additional GST was charged.
How much was the penalty imposed on FirstCry?
The penalty imposed on FirstCry by the CCPA was Rs 2,00,000.
What are the implications of this fine for consumers?
This fine emphasizes the importance of transparency in pricing, ensuring that consumers are not misled by deceptive practices and can make informed decisions while shopping.
What changes did FirstCry make following the CCPA's intervention?
Following the CCPA's intervention, FirstCry has updated its platform to ensure clearer displays of prices, including a prominent disclaimer stating that prices are inclusive of all taxes.
What is 'drip pricing' and how does it impact consumers?
'Drip pricing' refers to the practice of advertising a low initial price but adding extra fees later, which can mislead consumers about the total cost they will incur.
