E-commerce to be covered under Consumer Protection Act

E-commerce will be covered under the Consumer Protection Act and the central government will not face any loss in indirect tax revenue due to expansion of online retail business, Parliament was informed on Tuesday.

"E-commerce operations are already covered under the Consumer Protection Act, 1986," Minister of State for Food and Consumer Affairs Raosaheb Patil Danve said in a written reply to the Lok Sabha.

He was replying to a query whether there is any proposal to bring e-commerce operations under the Consumer Protection Law in view of complaints of cheating and other malpractices by such companies.

Danve said trading of goods by e-commerce does not attract levy of service tax.

"Goods which are imported/manufactured are cleared on payment of duty of customs/central excise, as the case may be, at the time of import/clearance from the factory.

"Therefore, as far as the Central Government is concerned, there is no loss to indirect tax revenue due to expansion of e-commerce," Danve said.

The Consumer Protection Act provides for better protection of consumers interest. Under the law, consumer forums have been set up for the settlement of disputes.

To further strengthen this law, the government is planning to introduce amendments to the Consumer Protection Act (CPA) 1986 in the ongoing Winter session of Parliament.