Swiggy Slapped With Rs 35,000 Fine For Overcharging Customer By Inflating Delivery Distance; Check

In a recent ruling by the District Consumer Disputes Redressal Commission in Hyderabad, food delivery giant Swiggy faced a penalty of around Rs 35,000 for overcharging a Swiggy One member by inflating the delivery distance. This decision was reached after the commission found Swiggy guilty of manipulating delivery distances, which led to additional charges for a service that was supposed to be free within a specified range.

Case Background

The incident came to light when Emmadi Suresh Babu, a Swiggy One member from Hyderabad, filed a complaint against Swiggy after he was charged a delivery fee despite his subscription. Swiggy One membership offers free deliveries within a certain radius, making it popular among customers who frequently use the platform. However, on November 1, when Emmadi placed an order, he noticed that Swiggy had reportedly inflated the delivery distance from 9.7 kilometres to 14 kilometres, resulting in a delivery fee of Rs 103.

Emmadi, unhappy with this unexpected charge, gathered evidence, including Google Maps screenshots to verify the actual distance, and approached the District Consumer Disputes Redressal Commission. The commission reviewed the evidence and found that Swiggy had indeed artificially increased the delivery distance for Emmadi's order, leading to a higher charge.

Court Ruling

In its final decision, the commission ruled in favour of Emmadi, stating that Swiggy's actions had caused mental distress and inconvenience. Swiggy's representatives were notably absent during the hearings, leading the court to proceed with an ex-parte decision.

The commission ordered Swiggy to compensate Emmadi in the following manner:
Refund of Delivery Charge: Swiggy was instructed to return the Rs 103 delivery fee.
Interest on Damages: An amount of Rs 350.48, with an additional 9% interest calculated from the date the complaint was filed, was awarded.
Compensation for Mental Distress: The commission mandated that Swiggy pay Rs 5,000 to Emmadi for the distress and inconvenience caused by this incident.
Litigation Costs: Another Rs 5,000 was ordered to cover Emmadi's legal expenses.

Furthermore, as a preventive measure, the commission directed Swiggy to stop manipulating delivery distances specifically for Swiggy One members. To reflect on the seriousness of the issue, the court also imposed Rs 25,000 as punitive damages on Swiggy, which is to be deposited into the consumer welfare fund managed by the Ranga Reddy district commission. This punitive measure aims to serve as a deterrent for similar practices in the future.

Swiggy's legal troubles come at a time when the platform has also increased its charges for users. Just ahead of Diwali, Swiggy raised its platform fee from Rs 6 to Rs 10 per order. This change has drawn comparisons to rival Zomato, which also increased its platform fee to Rs 10, creating additional expenses for regular users of these services.

Interestingly, while Swiggy and Zomato raised their fees, the hyperlocal e-commerce app magicpin took a different approach. Magicpin reduced its platform charges to Rs 5 per delivery, a strategy that could make it more attractive to cost-conscious customers in the highly competitive food delivery market.

Swiggy's recent issues with inflated delivery charges and increased platform fees highlight a significant challenge for food delivery apps in maintaining customer trust. As users increasingly rely on these platforms, expectations for transparency and fair pricing are growing. Incidents like Emmadi's case not only damage Swiggy's reputation but could also impact customer loyalty in a fiercely competitive sector.