FirstCry fined ₹2 lakh for misleading ads with deceptive pricing

New Delhi: The Central Consumer Protection Authority (CCPA) has fined Digital Age Retail Pvt. Ltd., the operator of e-commerce platform FirstCry, ₹2 lakh for publishing misleading advertisements and engaging in unfair trade practices by misrepresenting product prices, the consumer affairs ministry said in a statement on Friday.

The order followed a consumer complaint and an investigation supported by data from the National Consumer Helpline (NCH). The complaint said FirstCry displayed products with the representation ‘MRP inclusive of all taxes’, but levied additional GST at checkout. This practice, the CCPA observed, created a false impression of higher discounts and misled consumers about the final amount.

GST after discount

The probe found that in some cases, products advertised with a 27% discount were effectively sold at a discount of only 18.2% once GST was added. CCPA said this amounted to deceptive pricing and misleading advertising under Section 2(28), and unfair trade practices under Section 2(47) of the Act.

The regulator rejected disclaimers such as 'additional charges may apply' or ‘GST and additional charges may apply on discounted price’, holding that they did not override the statutory requirement that the MRP must be inclusive of all taxes, as per a statement by the ministry of consumers affairs.

By representing prices as tax-inclusive and then adding GST at checkout, the company engaged in ‘drip pricing’, which has been categorised as a dark pattern under the Guidelines for Prevention and Regulation of Dark Patterns, 2023. Such practices, CCPA said, undermined informed consumer decision-making and contravened Rule 7(1)(e) of the Consumer Protection (E-Commerce) Rules, 2020, which require platforms to display the total price, inclusive of all charges and taxes, upfront.

In its order, the CCPA noted the extensive operations of FirstCry, one of Asia’s largest online retailers for maternity, baby, and children’s products, and said the misleading practice had a "significant and widespread” impact on consumers.

It directed the company to ensure that both original and discounted prices were always displayed as inclusive of all taxes, with any additional charges such as shipping or convenience fees displayed prominently, it said.

Immediate impact

Following the intervention, FirstCry tweaked its platform to make prices more transparent. A prominent disclaimer stating ‘price inclusive of all taxes’ has been added to all pages of its website and mobile app, and the company has clarified that no GST will be charged separately on discounted prices. The discounted price displayed across the platform is now the final payable price inclusive of all taxes, the ministry said.

The case comes at a time when regulators have stepped up scrutiny of e-commerce platforms over misleading claims, drip pricing, and other dark patterns. Consumer rights expert Ashim Sanyal said the CCPA’s action would act as a deterrent and push online retailers to follow fair disclosure norms, especially as the government sharpens its regulatory framework to curb manipulative trade practices.

Queries sent to FirstCry were not answered immediately.