As per the regulatory filing, Zomato on Friday released a statement regarding an order issued by the District Consumer Dispute Redressal Forum (II) Jodhpur. According to the statement, the order pertains to an alleged erroneous delivery of non-vegetarian food items instead of vegetarian food items.
Nature of the Order
The District Consumer Dispute Redressal Forum (II) Jodhpur, or the District Commission, has imposed a monetary penalty of Rs 1,00,000 on Zomato and its partner, McDonald's, for this perceived violation of the Consumer Protection Act, 2019. Additionally, INR 5,000 has been awarded as the cost of litigation. Notably, both the monetary penalty and the cost of litigation are to be shared jointly and severally by Zomato and McDonald's.
Zomato's Response
Zomato, in response to the order, has expressed its intention to file an appeal against the decision. Based on legal advice from external counsels, the company believes it has a strong case on merits. The core of Zomato's argument lies in the distinction between its role as a facilitator for food sales and the ultimate responsibility of the restaurant partner for the quality and accuracy of the order. The company maintains that the order failed to appreciate this fundamental difference in responsibility.
Financial and Operational Impact:
According to Zomato, the order is not expected to have any material financial, operational, or other significant impact on the company.
Zomato shares
The shares of Zomato on Friday at 3:09 pm IST were trading at Rs 111, up by 1.05 percent.
