3 Golden ingredients constituting a valid contract – Offer, acceptance and consideration, wonder whether it’s time to introduce the 4th i.e. delivery?

Online Sale Vs. Offline Sale –?

While the online transactions have been the buzz for almost a decade, the Consumer Protection Act, 2019 (“Act”) has recently been amended to explicitly include e-commerce transactions within its scope, defining e-commerce as the buying or selling of goods or services including digital products over digital or electronic network.

In order to enhance the safeguards for consumers, particularly in the contemporary period of globalization, e-commerce, and online platforms, the Act was introduced to supersede the Consumer Protection Act, 1986. It offers enhanced protection for customers engaging in online transactions, among other things. The term "consumer" has been expanded to include those who purchase products or services online or through other electronic means; this definition was not included in the erstwhile Consumer Protection Act of 1986. In compliance with the terms of the Act the Department of Consumer Affairs has already notified the Consumer Protection (E-commerce) Rules, 2020 to protect consumers from unfair trade practices in e-commerce. Although, online transactions are covered under the regime of the Act, the Act does not provide clarity on the liability vis-à-vis offline v/s online sale transaction.?

At this juncture, its equally pertinent to look at the definition of “Contract” under law, which says “An agreement enforceable by law is a contract”. And the essentials of a valid contract include, amongst others, “offer”, “acceptance” and “consideration”. However, when the definition was being considered by the legislature, all sale transactions were performed offline and not online. Therefore, there was no need for the legislature or the law makers to dwell into the most essential and vital ingredient in the world of online marketplace i.e. “Delivery”, which is the most crucial ingredient in conclusion or performance of contract while conducting online transactions.

In author’s opinion, Delivery is the most essential and crucial ingredient of a valid and enforceable “online contract”. Pre-online days i.e. when there was no internet, no online marketplace(s), one would go to the market to buy products. Lets’ say a person wants to buy a phone, he/she would locate and physically visit a retail outlet of a mobile phone in one of the local shopping markets. Thereafter, he/she will visually and physically choose a phone. Finally, the consumer would pay the amount and take physical delivery of phone, thereby, concluding the contract of sale. In online transactions, “Delivery” plays a crucial part in conclusion / performance of a valid contract. And therefore, in each online transaction, it is imperative for marketplaces to clearly define the terms of sale, explicitly outlining the responsibility of the party undertaking activities such as “Delivery”, “Return” “pick-up”, etc.

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