CCPA penalises Justdial, Sunrise Foods for safety, misleading product claims

File photo: Central Consumer Protection Authority (CCPA)

NEW DELHI: Central Consumer Protection Authority (CCPA) has imposed penalties on online business directory Justdial and Sunrise Foods for violations involving consumer safety and misleading product claims.While it slapped a Rs 10 lakh penalty on Justdial for allowing listings of ammonium nitrate, a regulated explosive substance, on its platform without adequate safeguards, a Rs 1 lakh penalty was imposed on Sunrise Foods for marketing its bread as “100% Whole Wheat Bread” without disclosing its actual whole-wheat content.In an order on Wednesday, CCPA held that Justdial’s platform carried listings of ammonium nitrate without adequate disclosure of sellers’ valid licences issued by Petroleum and Explosives Safety Organisation (PESO), verification of buyers’ eligibility and mechanisms to ensure transaction traceability.

The listings also lacked appropriate warnings about legal restrictions on the possession and use of the substance.Justdial argued that it was an online directory and information-listing service, not a trading platform and that the listings were old and sourced from public-domain information or user submissions. However, CCPA held that reliance on vendor representations and removal of listings only after complaints or regulatory intervention was insufficient.

It directed the company to immediately discontinue listings, advertising and facilitation of access to the product.In a separate order, CCPA penalised Sunrise Foods for its “Everyday 100% Whole Wheat Bread”. The authority found the product contained only 64% whole wheat, below the prescribed 75% threshold for using the nomenclature “whole-wheat bread”. The packaging did not disclose the proportion of whole wheat, potentially misleading consumers about the product’s composition.

Sunrise Foods argued that the “100%” claim referred to the wheat flour component being entirely whole-wheat flour rather than refined flour. However, CCPA said the representation created a misleading impression about the product’s composition. It directed the company to discontinue the claim across print, electronic and social media with immediate effect.It directed the company to immediately discontinue misleading advertisements across media and submit a compliance report within 15 days.