What to do when e-commerce websites refuse to pay a refund

March 03, 2021

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This article is written by Gitika Jain pursuing BBA.LLB(Hons) from Amity University, Kolkata. This article deals with the process after e-commerce websites refuse to pay refunds.


Broadly speaking, e-commerce stands for Electronic Commerce which means that the buying and selling of goods or services or any other commercial transactions take place electronically on the internet. The first-ever example of an online sale that took place was on 11th August 1994 where a man sold a CD through his website NetMarket to one of his friends in America. Today E-Commerce has helped millions of sellers to expand their markets by selling their products online at a much larger scale which was next to impossible with the traditional go and buy retail market. Today E-Commerce is an industry worth 27 trillion dollars. Needless to mention, Amazon, Flipkart, Myntra, Shopclues are some of the E-Commerce websites in India.

Types of e-commerce models

In a nutshell, we mention the four main types of e-commerce models and exemplify them below:

Laws governing E-Commerce

Refund and cancellation policy

Cancellation means that the customer is returning a product purchased from an e-commerce website. The reasons could be bad quality or defective product items which do not meet the specifications as shown on the website at the time of purchase or it could be even that you got the same product with same quality elsewhere at a cheaper price.

Refund policy means that a customer who is dissatisfied with the good or service purchased can return the product and claim a refund for the amount charged at the time of purchase. In some cases, there is a time limit beyond which the customer cannot return the product, for example, 7 days or 40 days from the date of delivery of the product.

Consumer Protection Act, 2019 and refund policies

Some terminologies as defined in this Act

The new Consumer Protection Act, 2019 comes up with new rules and regulations. Under this act Central Consumer Protection authority would be established to protect the rights of consumers. Under these rules, the seller cannot say no for taking back defective or late delivered goods or if the goods do not meet the specifications described on the website.

The Act provides:

The basic differences or amendments that are put forward in the Consumer Protection Act

Information Technology Amendment Act, 2008 and e-commerce 

E-Commerce helps to eliminate the use of pen and paper and pave the way for Digital transactions. Thus, writing and signatures can no longer serve as legal recognition. In such a situation there is a need for legal changes to be introduced in e-commerce. This act has a vast influence on the legal infrastructure and the rules and regulations for the smooth functioning of the E-Commerce industry. With a view to protecting the privacy and security concerns of the consumers, the establishment of such an act was necessary. This act provides for the collection storage and sharing of the personal data of the visitors of an E-commerce website.

Objectives of the Act

Providing legal recognition for online transactions In the E-Commerce business, in place of the pen paper-based methods, facilitating digital signatures for the verification of any information:

Why have a policy

The following three legal agreements must be present in every commerce business.

Return/cancellation and refund policy

This agreement is necessary for a customer to inform him about the return and refund policies following the purchase of a good.

Terms and conditions

This agreement lays down the guidelines for a customer using the website to make a purchase. The terms of services are binding on the parties involved.

Privacy policy

The privacy policies include the type of information that the company collects from the customers, the purpose of collecting such data and the rules regarding the sharing of such information. This agreement is mandatory to be provided by the business under the technology and Amendment Act 2008 and Information Technology Rules, 2011.

Contents of a return and cancellation policy

Typically a return and refund policy should include the following key points:


Examples of refund and cancellation policy adopted by various e-commerce business websites

Amazon: Amazon manages a dashboard for its customers where they can see the returns, refunds and exchange status of the products purchased or returned by them. Some office products can be returned by raising the ticket while some cannot be returned and some products can be exchanged for other products.

Flipkart: Flipkart allows its customers to return damaged products that do not match the specifications asked by the customers. A time frame of 10 to 30 days is provided within which the customer can replace the product. The responsibility of taking the product away from the customer is taken up by Flipkart but the cost has to be borne by the customer.

Jabong: Jabong has a return and replacement policy where the refund is initiated within 7 days of the cancellation based on the condition of the returned goods. If any customer wants to cancel an order of product all together, then he has to do so before the selling of the item. Some items like CD’s, books, and cosmetics cannot be returned and the customer has no right to claim a refund on goods.

Myntra: Myntra allows for return and cancellation of its products provided the product is returned in its original form in regard to the packing tags and bills and the said item has to be exchanged within a period of 30 days after the receipt of the goods. The amount is put into the wallet of the customer associated with the Myntra account he holds which we can use to make purchases later on.

What if the E-Commerce platform refuses to refund


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