Shoppers Stop penalised for unfair trade practice by consumer

A consumer forum here has held retail chain Shoppers Stop Limited guilty of "unfair trade practice" and directed it to refund a customer Rs 69.50 charged as Value Added Tax (VAT). The Consumer Disputes Redressal Forum also asked Shoppers Stop to pay the customer Rs 1,000 as compensation and Rs 3000 towards cost of litigation.

Goregoan resident Devendra Kumar Negi had complained that he had visited the chain's store in Malad in January 2015 and bought a pair of sandals which were being sold at "30 per cent discount" with "VAT extra". In his complaint, he said the sandals had a list price of Rs 1,995 while he was charged Rs 1,466 as per Shoppers Stop's offer.

He said Shoppers Stop had charged him 14.50 per cent VAT, which came up to Rs 185.65, whereas the VAT rate at the time was 12.50 per cent, which meant he had to pay Rs 69.50 extra. Shoppers Stop argued its advertisement clearly mentioned that VAT would be charged extra (over and above) on the discounted price, and the buyer was aware of this, and thus could not complain of being overcharged.

Negi contended that VAT should not be charged "over and above" the discounted price, and also claimed the term "VAT extra" was in very small print with the intention that the buyer fails to spot and read it. The forum, in its order last week, said Shoppers Stop had indulged in unfair trade practice by publishing a misleading advertisement..

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