If you list a numismatic note on OLX, Meesho, or a similar marketplace and a fraudulent buyer scams you — does the platform bear any legal liability?
The platform has conditional liability — conditional on whether it had actual knowledge of the fraud and failed to act. Under IT Act Section 79, platforms are not liable for third-party content by default. This safe harbour is lost when: the platform received specific notice of the fraud and failed to act within the required timeframe; or the platform aided, abetted, or induced the fraudulent activity. For OLX and Meesho, the practical reality is that buyer-side fraud (the fraudulent buyer who scams the seller) is rarely something the platform receives advance notice of — making liability difficult to establish. Platform liability is more easily established where the same fraudulent buyer has been reported multiple times and the platform failed to suspend the account.
IT Act Section 79 — the safe harbour and its conditions
IT Act 2000 Section 79 provides that an intermediary shall not be liable for third-party information hosted on its platform, subject to three conditions: the intermediary does not initiate the transmission, select the receiver, or modify the information; the intermediary observes due diligence per the IT Rules 2021; and upon receiving actual knowledge that the content is being used for unlawful activity, the intermediary acts expeditiously to remove it. A platform that fails to act after receiving a specific report of fraudulent activity by a specific seller or buyer loses the Section 79 protection.
The due diligence obligations — IT Rules 2021
Under the IT (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021, significant social media intermediaries and marketplace platforms must: publish their terms of service and privacy policy; appoint a Grievance Officer in India; respond to grievance complaints within 24 hours and resolve them within 15 days; and maintain mechanisms to receive and process complaints about fraudulent listings. A platform that does not have a functional Grievance Officer, or whose Grievance Officer takes longer than 15 days to respond, is in breach of the IT Rules — which affects its Section 79 protection.
The practical limitation — buyer fraud is hard to pin on the platform
Buyer fraud in a numismatic transaction typically involves a fraudulent buyer who: sends a fake payment screenshot and demands the item; raises a false dispute after receiving the item to get a refund; or uses a stolen identity to place orders. The platform's liability question: did the platform know this buyer was fraudulent before they scammed you, and if so, did they fail to act? If the answer is no — the buyer had no prior reported fraud history — the platform has no liability for the first fraud they commit. If the same buyer has been reported 15 times for the same scam, and the platform has not suspended them, the platform's failure to act becomes material to liability.
What to do when a fraudulent buyer scams you on OLX or Meesho
Step 1: Report the fraudulent buyer immediately through the platform's in-app grievance mechanism — this creates the formal notice that starts the 15-day resolution clock. Step 2: File a cybercrime complaint at cybercrime.gov.in with the buyer's account details and the fraud description. Step 3: If the platform fails to respond to the grievance within 15 days, file a complaint with the Ministry of Electronics and IT (MeitY) through the Grievance Appellate Committee (GAC) established under the IT Rules 2021. The GAC is a statutory body that reviews unresolved platform grievances.
Laws & authorities referenced in this chapter
IT Act 2000 — §79 (safe harbour: intermediary not liable for third-party fraud unless actual knowledge + failure to act)
IT (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021 — Rule 4 (due diligence: Grievance Officer; 24-hour acknowledgement; 15-day resolution)
IT Rules 2021 — Grievance Appellate Committee (GAC): statutory body for unresolved platform grievances after 15 days
Consumer Protection Act 2019 — §2(17) (e-commerce entity: marketplace platforms have additional obligations under e-commerce rules)
Platform liability for buyer fraud: conditional — safe harbour (IT Act §79) lost when platform had actual knowledge + failed to act. IT Rules 2021: Grievance Officer must respond within 24 hours; resolve within 15 days. Repeat-reported fraudulent buyers not suspended = platform loses safe harbour. Practical steps after being scammed: in-platform grievance report → cybercrime.gov.in complaint → MeitY Grievance Appellate Committee if platform fails to resolve in 15 days. First-time buyer fraud: hard to establish platform liability; focus on identifying the buyer through cybercrime cell.
This is educational content, not legal advice. For a specific situation, please consult a qualified legal professional. Excerpted from Currency, Coins & The Law by Mayank Agarwal, Part 40: Platform Liability — OLX, Instagram, Meesho & ONDC — Marketplace Fraud, ONDC Compliance, Account Deletion Rights.