In a recent Judgment, the bench consisting Justice Dr S Muralidhar and Talwant Singh set aside an order imposing restraint on retailing the products of Amway, Oriflamme and Modicare without permission. The guidelines examined by the bench and settled stating that it is purely advisory and doesn’t qualify as law. Last year, one Judge Bench did restrict the merchandising of Amway and other products in e-commerce websites which brought values to companies like Amazon and Flipkart. The bench opined that sellers and e-commerce entities need to seek permission from the Direct Selling companies to offer, display and sell their products and held that e-commerce companies cannot take benefit of ‘exhaustion of Trademark Rights’ principle. Otherwise, platforms such as Amazon and other equal entities will proceed to enjoy the status of intermediaries, due diligence was required to be undertaken. The Judgment by the Bench took note of the Single Judge Bench’s decision, where it considered a submission from Union of India to decide an interim relief, as it is not even a party to any of the suits filed to the bench. Thus, it opined that in a civil suit when the Court demanded the Union of India to inscribe on such aspect, which shall deviate from the Civil Procedure Code.
Merely stating guidelines in Official Gazette doesn’t establish a status of law within the ambit of Article 13 of The Constitution of India. The source used in framing the guidelines was the Consumer Protection Act (CPA), and the E-commerce companies can defy the guidelines under CPA. The E-commerce companies did knock on the doors of the Supreme Court after Delhi High Court had imposed an injunction on direct selling of the products of Amway and other companies.
- Parliamentary Committee had recommended a regulatory to directly selling a business.
- Amazon had dragged Wal-Mart owned Flipkart of unauthorized selling in the platform in Delhi High Court.
- Companies like Amway, Modicare and Oriflamme filed a petition against e-commerce companies like Amazon, Flipkart and Snap deal against unauthorized selling of their products.
- “The Delhi High Court judgement clarifies that neither e-commerce platforms nor sellers can sell our products without our consent, and we are hopeful it will continue,” Indian Direct Selling Association (IDSA) chairman Vivek Katoch said.
- Delhi High Court had barred e-commerce companies from selling the products of direct selling companies without permission.
Edited by J. Madonna Jephi
Approved & Published – Sakshi Raje
- The Economic Times, Amazon moves Supreme Court against the direct selling companies https://economictimes.indiatimes.com/industry/services/retail/amazon-moves-supreme-court-against-direct-selling-companies/articleshow/70867903.cms?from=mdr
- Bar & Bench, Delhi HC set aside order restraining Amazon, Flipkart from selling Amway products without consent https://www.barandbench.com/news/litigation/delhi-hc-sets-aside-order-restraining-amazon-flipkart-from-selling-amway-products-without-consent
- Business Today, Delhi HC restrains Amazon, Flipkart, Snapdeal from selling direct sellers’ products without consent https://www.businesstoday.in/current/corporate/delhi-hc-restrains-amazon-flipkart-snapdeal-selling-direct-sellers-products-consent/story/363149.html