New Delhi: A District Consumer Disputes Redressal Commission has directed online baby products retailer FirstCry to pay ₹50,000 in compensation to a consumer after finding that the company cancelled his order without sufficient justification, withheld his payment and internally labelled him as a “fraud user.” The commission also ordered a refund of ₹2,130 with interest and ₹5,000 towards litigation costs.
Order Cancelled Without Explanation
The case was filed by Shaik Altaf, who had placed an order for a children’s tricycle on December 1, 2024, through FirstCry’s online platform. He paid ₹2,130.06 through PhonePe for the purchase.
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According to the complaint, the order was cancelled the next day without any explanation, and the amount was not refunded. When Altaf approached the company’s customer support team, he was told that the payment had been adjusted against a previous transaction from 2023.
FirstCry allegedly claimed that in the earlier transaction, the consumer had returned incorrect products and obtained a refund while retaining the original items. Altaf denied the allegation, saying the earlier return had been completed under the company’s own process after pickup, warehouse verification and quality checks.
Commission Questions ‘Fraud User’ Label
During the proceedings, it emerged that FirstCry had internally categorised the complainant’s order as a “Fraud User Order Cancel.” The commission viewed this seriously, observing that branding a customer as fraudulent without inquiry or an opportunity to respond could affect the person’s dignity and reputation.
The commission found the company’s position inconsistent. Records showed that before the National Consumer Helpline, FirstCry had acknowledged that refunds relating to the 2023 transaction had already been processed. However, the company later relied on the same transaction to justify withholding payment for the new order.
The forum observed that once a return request had been verified, accepted and refunded, it was not reasonable for the company to reopen the same transaction later and use it to deny benefits in a subsequent purchase.
Refund, Interest and Costs Ordered
The commission held that cancelling the order, retaining the customer’s money, taking contradictory positions before different forums and marking the consumer as a “fraud user” without due process amounted to deficiency in service and unfair trade practice.
It also noted that company representatives had contacted Altaf after the complaint was filed and offered a settlement involving a refund of ₹2,190 along with ₹15,000 as compensation. The commission did not treat the offer as an admission of wrongdoing but considered it an attempt to resolve the dispute.
The retailer’s claim that the order had been placed by another person was rejected. The commission relied on payment records and order details submitted by the complainant and found the company’s supporting documents unclear and unreliable.
In its final order, FirstCry was directed to refund ₹2,130 with 9 percent annual interest from December 1, 2024, until payment is made. It also awarded ₹50,000 as compensation for mental agony and reputational damage and ₹5,000 as litigation costs. The company has been asked to comply within 45 days and refrain from such unfair trade practices in future.
