The Delhi High Court on Monday issued notice in a plea challenging Rule 4(1)(a) of Consumer Protection (E-Commerce) Rules, which mandates all e-commerce entities to be a corporate entity under the Companies Act, 2013 (Dhruv Sethi v. UOI)..Notice was issued by a Division Bench of Chief Justice DN Patel and Justice Prateek Jalan to the Central government in a petition preferred by one Dhruv Sethi. .The Court, however, refused to stay the operation of the Rule. .The petitioner is an entrepreneur who sells custom merchandise online via a web portal. It is the petitioner’s case that the Rule violates Article 19(1)(g) of the Constitution of India, as it restricts the petitioner’s right to carry on the trade through the internet..The obligation to incorporate as a company and the consequent exclusion of sole proprietorship, Limited Liability Partnership (LLP), Hindu Undivided Family (HUF) etc from the e-commerce space is neither reasonable nor in the interest of general public, the petitioner has asserted. .This discrimination, the petitioner alleges, is in violation of Article 14 of the Constitution of India. .The petitioner has further contended that the Rule is not in consonance with the aims and objectives of the Consumer Protection Act, 2019, and is ultra vires the rule-making power conferred to the Centre to prevent unfair trade practices in the e-commerce space..“The impugned Rule does not prevent unfair trade practices and hence is beyond the Central Government’s rulemaking power”, the plea states..Senior Advocate Anand Grover with Advocates Samyak Gangwal, Krishnesh Bapat, Meghna Jhandu appeared for the petitioner.
The Delhi High Court on Monday issued notice in a plea challenging Rule 4(1)(a) of Consumer Protection (E-Commerce) Rules, which mandates all e-commerce entities to be a corporate entity under the Companies Act, 2013 (Dhruv Sethi v. UOI)..Notice was issued by a Division Bench of Chief Justice DN Patel and Justice Prateek Jalan to the Central government in a petition preferred by one Dhruv Sethi. .The Court, however, refused to stay the operation of the Rule. .The petitioner is an entrepreneur who sells custom merchandise online via a web portal. It is the petitioner’s case that the Rule violates Article 19(1)(g) of the Constitution of India, as it restricts the petitioner’s right to carry on the trade through the internet..The obligation to incorporate as a company and the consequent exclusion of sole proprietorship, Limited Liability Partnership (LLP), Hindu Undivided Family (HUF) etc from the e-commerce space is neither reasonable nor in the interest of general public, the petitioner has asserted. .This discrimination, the petitioner alleges, is in violation of Article 14 of the Constitution of India. .The petitioner has further contended that the Rule is not in consonance with the aims and objectives of the Consumer Protection Act, 2019, and is ultra vires the rule-making power conferred to the Centre to prevent unfair trade practices in the e-commerce space..“The impugned Rule does not prevent unfair trade practices and hence is beyond the Central Government’s rulemaking power”, the plea states..Senior Advocate Anand Grover with Advocates Samyak Gangwal, Krishnesh Bapat, Meghna Jhandu appeared for the petitioner.
