Date of judgement:
25th April, 2022.
Bench:
Hon’ble Mrs. B. Uma Venkata Subba Lakshmi and Hon’ble Mrs. C. Lakshmi Prasanna
Parties:
Complainant – Rajkumar Gummi
Opposite Party – UBER India Systems Private Limited
OVERVIEW
- The complainant, Rajkumar Gummi, who represented himself in the case,was a registered user of UBER India Systems Private Limited.
- The appeal was filed under Section 35(1)(a) of the Consumer Protection Act, 2019 alleging that Uber was involved in unfair trade practices by charging cancellation fee from customers even when the company itself cancelled confirmed rides.
ARGUMENTS BY THE COMPLAINANT
- The complainant submitted that whenever a confirmed ride was unilaterally cancelled by the company on its own part, the cancellation fee was added to the next ride that was booked by the customer.
- This did not merely caused arbitrary inconvenience to the customer but was also a violation of the Consumer Protection Rules, 2020.
- The petitioner thus submitted that the company must be directed to pay an amount equivalent to the cancellation fees to the customer whenever a ride was cancelled unilaterally by the company.
- Furthermore, the company should be directed to refund all the cancellation fees charged from the customers from the date of coming into force of the Customer Protection (E-commerce) Rules, 2020.
ARGUMENTS BY THE OPPOSITE PARTY
- The Company contended that it was not established that the complainant was a customer and was aggrieved by the cancellation fee. Hence, he did not have any locus standi in the matter
- Furthermore, the opposite party submitted that the suit was filed with a mala fide intention to destroy the reputation and goodwill of the company.
- The Company pleaded that the customer is given prior information of the cancellation fees and "click yes" option is regarded to be a "click wrap" contract
- The cancellation fees is proportional to the distance travelled and time invested by the driver on reaching the customer's location.
- No cancellation charges are levied for the first 180 seconds of the grace period of the rider.
- Furthermore, the in app support can be used by the customers to voice their grievances and if it is found that cancellation charges were wrongfully levied then they are refunded to the customers.
- All drivers of the company were independent contractors who are individually responsible for their acts of omission and commission.
ISSUES RAISED
- Whether the company was liable for unfair trade practice?
- Whether any relief or compensation shall be awarded to the complainant?
JUDGMENT ANALYSIS
- On the issues of locus standi, the Commission held that the complainant was a customer of the opposite company and hence had a cause of action.
- After referring to several relevant provisions of the Customer Protection (E-commerce) Rules, 2020 and Motor Vehicles Act, 1988, the Commission held that the standard contracts must be fair and equitable.
- The terms of the non-negotiable contract would be held to be unfair if they are detrimental to the interests of the consumers and if they cause an imbalance in the rights and obligations of the parties.
- In the present case, it is necessary for the company to ensure that the transportation mechanism is transparent and consumer-friendly.
- The Commission held that irrespective of the dynamics between the company and driver partners, the costs of a unilateral cancellation by the other side cannot be attributed to the consumer.
- The Commission held that there was no transparency in the cancellation criterion and the information conveyed to the customers was partial and incomplete.
- Uber thus, cannot burden it's customers with unreasonable operational costs
- The company was charging cancellation fees irrespective of whether the ride was cancelled by the customer or the driver and such arbitrary charge established the non-transparent pricing and discrepancy and hence amounted to unfair trade practice on the part of the company.
CONCLUSION
The Commission held that the company was liable to compensate the complainant for the unfair cancellation charges. However, the relief of refund to all customers from whom cancellation fees had been charged could not be granted as the instant appeal was not filed in a representative capacity under Section 35(1)(c) of the Consumer Protection Act, 2019. However, the Commission directed the company to make its cancellation criterion more transparent and to not charge cancel
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