In a significant ruling, the Ranga Reddy District Consumer Disputes Redressal Commission in Hyderabad has ordered Swiggy, a leading food delivery service, to compensate a customer for unfair trade practices related to inflated delivery distances. The case was brought forth by Emmadi Suresh Babu, a Hyderabad resident, who claimed that he was charged an excessive delivery fee despite his membership benefits.
Babu purchased a Swiggy One membership, which promised free delivery within a specified distance. However, on November 1, 2023, when he ordered food, Swiggy allegedly increased the delivery distance from 9.7 kilometers to 14 kilometers. This manipulation resulted in a delivery fee of Rs 103, which Babu argued was unjust given his membership.
The commission reviewed evidence presented by Babu, including screenshots from Google Maps that clearly indicated the actual delivery distance. Swiggy’s absence from the hearings meant the court could proceed without their defense, relying solely on Babu’s affidavit and supporting documentation.
The court ruled in favor of Babu, ordering Swiggy to refund Rs 350.48 with 9 percent interest from the date of filing, along with the Rs 103 delivery charge. In addition, the commission awarded Rs 5,000 for mental distress and inconvenience, imposed Rs 5,000 in litigation costs, and mandated that Swiggy cease the practice of inflating delivery distances for Swiggy One members. Furthermore, Swiggy was ordered to deposit Rs 25,000 as punitive damages into the Consumer Welfare Fund of the Ranga Reddy District Commission. The company has 45 days to comply with the court’s order.
This ruling comes at a critical time for Swiggy, which is preparing for its initial public offering (IPO) scheduled for November 6, aiming to raise over Rs 11,000 crore from the primary market. The IPO has garnered substantial interest from investors, with significant bids from entities like Norges, Norway’s sovereign wealth fund, and Fidelity, totaling over $15 billion, far exceeding the $605 million allocated for such investments.
