Amazon ordered to pay Rs 15,000 after withholding customer’s earbud refund | Legal News

“It is obligatory on the part of the Opposite Party (Amazon Retail India Private Limited) to refund the amount to the Complainant immediately after the receipt of the said amount. The conduct of the Opposite Party in failing to refund the amount… making contradictory statements regarding the refund, arbitrarily reducing the refund amount without assigning any reasons and neglecting to redress the grievance of the Complainant clearly amounts to deficiency of service… and also amounts to unfair trade practice,” the commission said on June 17.

The order could have far-reaching implications for millions of online shoppers who often face prolonged delays in receiving refunds. The commission made it clear that an e-commerce marketplace cannot retain money that has already been refunded by a manufacturer and leave consumers chasing their own money through repeated emails, customer support interactions and legal notices.

Earbuds developed defects after purchase

According to the complaint, Vivekananda purchased EarFun Air Pro 3 Noise Cancellation Earbuds (2023 Model) through Amazon on January 18, 2024, for Rs 5,199. The product, manufactured by EarFun Technology (HK) Limited, Hong Kong, and supplied through its Hyderabad-based agent, carried an 18-month standard warranty. The manufacturer had also offered an India VIP lifetime warranty for eligible customers.

After using the earbuds, the consumer began facing recurring Bluetooth connectivity issues during audio playback. He promptly contacted both the manufacturer and Amazon through emails and sought warranty service. Initially, the manufacturer informed him on December 3, 2025, that the earbuds were covered under the lifetime warranty.

However, when he attempted to raise a claim through the company’s website, the system displayed a message stating that the product was “out of warranty,” despite his having activated the lifetime warranty using the QR code supplied with the product.

Following further correspondence, the manufacturer agreed to honour the warranty. It first offered to replace the earbuds but later processed a full refund of Rs 5,199 on December 16, 2025, instead of sending a replacement. The refund amount was transferred to Amazon for onward payment to the customer.

Months of follow-ups yielded nothing

Amazon emailed him on January 9 and January 10, 2026, stating that the refund would soon be credited to his account. Acting on the company’s instructions, the consumer even shared his bank account details to facilitate the transfer.

Despite these assurances, no refund was received. The consumer continued writing emails, contacting customer support, and making repeated follow-up calls. Instead of resolving the issue, Amazon allegedly informed him on January 29, 2026, that only Rs 4,689.52 had been approved for refund, reducing the original refund amount by more than Rs 500 without assigning any reason.

Even this reduced amount was never credited to his account. Finding no solution despite weeks of follow-up, the consumer issued a legal notice on February 18, 2026, to Amazon, the manufacturer and its authorised agent.

The commission noted that Amazon received the notice on February 23, but neither sent any reply nor refunded the amount. Subsequently, on March 2, 2026, Amazon again informed the consumer that the refund had been processed, but once again no money reached his account.

Commission finds refund was already with Amazon

• After examining the documentary evidence, including invoices, warranty emails, refund communications and legal notices, the commission concluded that the manufacturer had, in fact, processed the refund on December 16, 2025, and transferred the amount to Amazon.
• The commission held that despite receiving the refund, Amazon neither passed it on to the customer nor provided any explanation for withholding it. Instead, it kept postponing the payment, issued contradictory communications, and even arbitrarily reduced the refund amount without justification.

• The commission observed that such conduct squarely fell within the definitions of “deficiency in service” under Section 2(11) and “unfair trade practice” under Section 2(47) of the Consumer Protection Act, 2019.
• It further noted that Amazon did not appear before the commission despite service of notice.
• Consequently, the complainant’s evidence remained “unchallenged, unrebutted and uncontroverted,” strengthening the consumer’s case.
• The commission concluded that the marketplace platform had subjected the consumer to unnecessary inconvenience, financial hardship and mental agony by withholding money that was never in dispute once it had been refunded by the manufacturer.

Relief granted

Allowing the complaint in part, the commission directed Amazon Retail India Private Limited to refund Rs 5,199, being the purchase price of the earbuds, pay Rs 5,000 as compensation for the mental agony caused to the consumer, and Rs 5,000 towards litigation expenses, including advocate’s fees. The commission directed Amazon to comply with the order within 45 days from the date of receipt of the order.

Significance

The order reinforces that e-commerce platforms cannot indefinitely withhold customer refunds once they have received the money from manufacturers or sellers. It makes clear that marketplaces are accountable for ensuring refunds are promptly credited to consumers and cannot escape liability by citing internal processing delays.

The commission also held that issuing contradictory assurances, arbitrarily reducing the refund amount without explanation, and ignoring repeated consumer grievances constitute both “deficiency in service” and an “unfair trade practice” under the Consumer Protection Act, 2019.

For online shoppers, the ruling underscores that consumers are entitled not only to the refund amount but also to compensation for mental agony and litigation costs where an e-commerce platform’s conduct forces them into prolonged follow-ups and legal proceedings.

For consumer-related grievances, individuals may contact the consumer helpline in their respective states (Andhra Pradesh helpline: 0866-2551431) or call the National Consumer Helpline at 1915 for assistance.