Central Consumer Protection Authority Levies INR 10 Lakh Penalty on Rapido for Deceptive Offers Through Advertisements

On August 20, 2025, the Central Consumer Protection Authority (CCPA), through a decisive order held Roppen Transportation Services Pvt. Ltd., operating under the brand name Rapido, liable for engaging in misleading advertisements and unfair trade practices. A penalty of INR 10,00,000 was levied on the company and the CCPA issued specific directives to ensure immediate discontinuation of the campaigns and restitution for affected consumers. The key finding of CCPA was that Rapido had “engaged in a practice calculated to mislead consumers by both commission and omission,” a deliberate course of conduct that systematically overstated the company’s service capabilities while simultaneously and strategically concealing vital qualifying conditions, all with the singular purpose of advancing its commercial interests. The CCPA concluded, the said practice not only distorted crucial consumer decision-making processes but also served to erode the principles of fair competition within the marketplace.

The ruling highlighted that this deceptive conduct constituted a clear violation of both the statutory framework laid out in the Consumer Protection Act, 2019 (Act), specifically provisions prohibiting misleading advertisements and unfair trade practices, and the stringent provisions of the Guidelines for Prevention of Misleading Advertisements and Endorsements for Misleading Advertisements, 2022 (2022 Guidelines).

1. Background of the Case

The CCPA took suo motu cognizance of several impugned advertisements that were prominently featured across Rapido’s official platforms, including its dedicated YouTube channel and various social media handles. These advertisements conveyed absolute guarantees to the public: (i) Guaranteed Auto and (ii) “AUTO IN 5 MIN OR GET INR 50.” The CCPA, upon observing the widespread dissemination of these claims, initiated a preliminary inquiry to ascertain their genuineness and veracity. The CCPA noted that the magnitude of such an assertive claim, disseminated without a clear and hard-to-miss disclaimer, possessed the inherent capacity to establish a powerful visual impression and cultivate a definite expectation among consumers concerning the speed and reliability of the auto-hailing service. This explicit guarantee was viewed as functioning as a direct inducement to consumers as a class, particularly those navigating a competitive market of ride-hailing applications. CCPA observed that by promoting this assurance while simultaneously concealing material conditions or limitations, the advertising campaign appeared to be infringing upon the fundamental consumers’ right to be informed, a right that is deeply enshrined under Section 2(9) of the Act.

Between April 2023 and May 2024, 575 complaints against Rapido were filed on the National Consumer Helpline for service failures, refund delays, overcharging, and unmet promises. Five complaints targeted the “AUTO IN 5 MIN OR GET INR 50” claim, revealing consumers received only INR 5 in “Rapido coins,” misleading them about the promised INR 50 compensation. These practices violated Sections 2(28), 2(47), and 21 of the Act and Guidelines 4 and 12 of the 2022 Guidelines, prompting the CCPA’s suo motu intervention.

2. Assessment by CCPA

The procedural diligence included serving Rapido with a detailed notice, sharing the investigation report for response, and scheduling formal hearings. The CCPA identified several material discrepancies and instances of concealment that underpinned the finding of deception.

The Authority critically pointed out that the crucial term “up to” was not utilized anywhere within the impugned advertisement or its associated claims. The failure to use a term indicating a limit, demonstrated that Rapido had neglected to disclose material information that was absolutely essential for consumers to be able to make a truly informed decision. The CCPA further observed that the claims of “Guaranteed Auto” and “AUTO IN 5 MIN OR GET INR 50” successfully created an unqualified and absolute impression in the consumer’s mind, suggesting that if an auto was not provided within the stipulated five minutes, the consumer would invariably receive the full amount of INR 50. This significant omission was found to contravene Guideline 11(a) and 11(b) of the 2022 Guidelines.

While the CCPA acknowledged the inclusion of the term “T&C apply,” it noted that it was printed in an “extremely small font” and was consequently “hardly readable.” Itemphatically clarified that the mere presence of the term, especially when displayed in extremely fine print or when not prominently visible, does not satisfy the essential requirement for transparency. A company cannot successfully escape its liability by relying solely on the inclusion of the term ‘T&C’s Apply’ when the primary advertisement is designed to be intentionally misleading. This finding underscores the principle that the manner of disclosure is as important as the act of disclosure itself.

The CCPA found that the promised “INR 50” benefit was not provided in actual currency but as “Rapido coins” with highly restrictive limitations: redeemable only for bike rides on Rapido’s platform with a short 7-day validity period. The CCPA found that the restrictions changed the benefit’s nature and limited its usefulness. This hidden condition reduced the real value of the INR 50 offer and pressured users into repeated transactions with unfair rules, breaching the Act’s main provisions.

Rapido advertised a categorical service guarantee, but its Terms and Conditions stated that the guarantee was provided by individual drivers, not Rapido itself. The CCPA found this contradictory stance to be an attempt to avoid legal responsibility and ruled it both an unfair trade practice under Section 2(47) and a misleading advertisement under Section 2(28) of the Act.

Rapido’s representatives stated that the disputed advertisement was a promotional claim meant to run for a limited period. The CCPA found this argument unsupported by evidence and noted that records indicate the advertisement aired for at least 548 days, or around 1.5 years, across 120 cities nationwide. The Authority noted this prolonged campaign showed an intent to influence consumers, while Rapido did not sufficiently address numerous complaints or stop airing the ad. The CCPA concluded this reflected Rapido’s disregard for consumer rights and interests.

3. CCPA’s Orders and Broader Implications for the Digital Transport Sector

In addition to the financial penalty, the CCPA issued a crucial corrective directive to ensure consumer restitution. The Authority mandated that Rapido must reimburse the consumers who did not receive the promised INR 50 as advertised under the misleading “AUTO IN 5 MIN OR GET INR 50” campaign. Furthermore, Rapido was directed to immediately and entirely discontinue the display of the misleading advertisement. The concealment of material information from consumers, while simultaneously making an absolute and unqualified claim in the advertisement, constituted the core violation. The CCPAfound that the highly deceptive nature of the advertised claims, paired with the subsequent failure to address hundreds of consumer grievances, firmly established a prima facie case of misleading advertisement and unfair trade practices under the Act.