New Delhi: The Delhi High Court has allowed e-commerce platforms to sell products of direct selling entities, including Amway and Oriflame.
A single-judge bench of the court had on 8 July barred e-commerce platforms from selling these products.
The two-judge bench of Justice S. Muralidhar and Justice Talwant Singh on Friday held that the single-judge bench’s order, in which Amazon was injuncted from selling goods of Amway, was passed without considering that it could have an adverse impact on online marketing.
The division bench said the model framework guidelines on direct selling (DSG), issued on 26 October, 2016, by Department of Consumer Affairs, are not enforceable as they are not law.
The two-judge bench held that, as per the constitutional provisions, “Merely because the DSGs are notified in the Gazette, they do not attain the status of ‘law’.”
The judgement explains in detail the questions pertaining to legal battles arising and the obligations of ‘intermediaries’ in cases where products of direct selling entities are sold on e-commerce platform without the authorization of direct selling entities.
The Court categorically said once the product has been sold and the ownership over the product transferred, no further condition can be imposed by the seller on the buyer to prevent “post-sale alienation”.