The Supreme Court has quashed the Punjab and Haryana High Court’s guidelines and directions against OLX including a direction “to bear cost of investigation, when a fraud is committed, using their App or Website and whether a cost of Rs 25,000 per FIR be deposited.”
The bench of Justices U.U. Lalit and S. Ravindra Bhat heard the plea filed by OLX India BV against the interim order passed by the Punjab and Haryana HC.
The Punjab and Haryana High Court on December 13, 2021, during a hearing of a petition seeking direction to the respondent to conduct fair and impartial investigation in FIR registered under Section 420 IPC in Police Station DLF, District Gurugram observed that it is a matter of fact that in recent years, in the districts of Gurugram, Faridabad, Rewari, Palwal and Mewat, hundreds of FIRs have been registered, in which accused persons, by using OLX platform, have given various advertisements regarding sale of gold (in different form) or sale of vehicles like motorcycle or car at cheaper price or asking for professional service like architect or accountants have allured many innocent persons and thus, have committed the offence of cheating and forgery.
The bench held that the common modus operandi of these accused persons, locally called the Titloo Gang, is that as and when a person responds to OLX advertisement, the accused person would call him to their native village or nearby place and then by playing fraud, dupes a victim by taking money under threat and in that process, some of the persons have lost lakhs of rupees. In many cases, victims are from different states, who are allured to buy gold at lower prices and then given fake gold by taking huge amounts of money.
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It has come to notice of the Court, on the basis of various investigation reports given in different cases, that mobile numbers are obtained on fake ID proof like in the present case and even the police, later on, face a lot of difficulty in verification of the case and identifying the actual culprit and arresting them. It is also a matter of fact that in such or similar cases, where FIRs are registered, huge financial burden is put on the State Exchequer, as the police is put under heavy pressure to investigate cases and the OLX Group/similar groups are not performing any reciprocal duty towards the country and are only interested in earning profits by putting the advertisements without giving the details or verifying the antecedents of the person putting the advertisement, the Court said.
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Since the High Court is dealing with such or similar type of cases every day, wherein by using OLX platform, the accused persons are cheating the innocent people, the High Court issued notice to the Home Secretary, Government of Haryana as well as Director General of Police, Haryana to inform the High Court whether any guidelines have been issued with regard to giving an advertisement on a platform like OLX or any other similar agency. As per the High Court, the affidavit be filed explaining whether it is feasible to lay guidelines.
(i) That OLX/similar service providers will take money from the purchaser or buyer at least 24-48 hours before the deal to avoid any fraud. The amount will be returned in the next 24-48 hours, if the deal is not finalized.
(ii) For a big company like OLX, earning huge profits from advertising, a reciprocal duty be imposed to bear cost of investigation, when a fraud is committed, using their App or Website and whether a cost of Rs 25,000 per FIR be deposited in government treasury.
(iii) The extent of liability, which can be fixed by the owner or person responsible for day to day business of such App, if the guidelines are not followed.
It is further directed that all the advertisements on OLX platform be deleted and be re-listed only after attaching an open PDF file along with each advertisement, containing the following:-
(a) At least 2 ID proofs of the person, who is proposing to sell a property (moveable or immoveable) or asking any professional service;
(b) Two mobile numbers with a screen shot/photocopy of message sent by the server, who issued the SIM verifying name of owner as per their record;
(c) Details of the property to be sold whether moveable or immoveable and a document of title like Registration Certificate or insurance paper for vehicles or sale deed etc. for property.
(d) In aforesaid five Districts, in case the proposed seller is residing in a village or in the area of Municipal Corporation/Municipal Council, a certificate of Member of the Panchayat or Municipal Councillor certifying that the proposed seller is not involved in any such or similar criminal case and is a genuine owner of property.
(e) Only by putting this information in a PDF file, the advertisements will be accepted by OLX or any other such agency and will be floated for the general public.