E-commerce fraud: what it is and how it works in India

By Advocate Panchanand Shaw, Bar Council of West Bengal · Published 2 Nov 2026 · Online fraud

E-commerce fraud is deception through an online marketplace, shopping app or payment link where the buyer pays but does not get the promised goods. Report it the same day on cybercrime.gov.in or by dialling 1930, tell your bank's nodal officer in writing, and preserve the listing, chat and payment records. Section 66D of the IT Act, 2000 and Section 318 of the BNS, 2023 are the core offences.

E-commerce fraud is any deception carried out through an online marketplace, shopping app, social commerce page or payment link where the buyer pays but does not receive the promised goods, or receives something materially different from what was advertised. In Indian law the core criminal provisions are Section 66D of the Information Technology Act, 2000 for cheating by personation using a computer resource, Section 318 of the Bharatiya Nyaya Sanhita, 2023 for cheating, and Section 316 of the BNS for criminal breach of trust where money or goods are entrusted. A victim can report on the National Cyber Crime Reporting Portal or dial 1930, and can separately ask the bank to freeze the beneficiary account under the RBI's limited-liability framework.

The practical definition matters because not every bad purchase is a crime. A delayed delivery, a genuine quality dispute or a refund refusal is usually a consumer dispute. The line is intention: was the seller dishonest from the start, did they induce payment through a false representation, and did they disappear with the money? Understanding that distinction decides whether the reader files a police complaint, a consumer complaint, or both. This article explains how the fraud typically runs, what the statutes cover, the exact complaint steps, the evidence that decides the case, and the mistakes that quietly destroy recovery chances.

How the fraud typically runs

Most e-commerce frauds follow a few recognisable patterns. In the fake-seller pattern, a listing appears on a marketplace or a social page at a price well below market, the buyer is pushed to pay by UPI or bank transfer outside the platform, and the seller stops responding. In the counterfeit pattern, a branded product is shipped but the item is fake, refurbished or a different model. In the non-delivery pattern, a tracking number is generated but the parcel never moves, or it is delivered to a different address. In the overpayment or refund scam, the fraudster sends a fake payment screenshot and asks the buyer to refund the excess. In the account-takeover pattern, a compromised marketplace account is used to list goods and collect payments from unsuspecting buyers.

Each pattern leaves different evidence. A fake-seller fraud leaves chat records, a listing URL and a UPI reference. A counterfeit case leaves the parcel, the invoice and the product itself. An overpayment scam leaves a forged screenshot and a bank statement. Investigators and courts look at this trail, not at the anger in the complaint. The first 48 hours are the best window to stop the money because the beneficiary account is still likely to hold funds or be traceable through the banking system.

What the law says

Section 66D of the IT Act, 2000 punishes cheating by personation using a computer resource or communication device. The punishment is imprisonment up to three years and a fine up to one lakh rupees. Section 66C covers identity theft, which is relevant when the fraudster uses another person's name, photographs or KYC documents to open a seller account or receive money. Section 66 covers computer-related offences generally and is used where a device or account is accessed without the owner's permission. Section 67 and Section 67B deal with obscene material and child sexual material respectively and arise only in the narrower cases where a fraudulent listing is used to distribute such content.

Under the BNS 2023, Section 318 is the general cheating offence. Section 318(4) deals with cheating and dishonestly inducing the delivery of property, and the punishment can extend to seven years and a fine. Section 316 covers criminal breach of trust, which applies when a seller or intermediary is entrusted with money or goods and dishonestly misappropriates them. Section 336 covers forgery, used where fake invoices, payment screenshots or delivery receipts are created. Section 351 covers criminal intimidation, which sometimes appears when a buyer threatens the seller or the seller threatens the buyer after a dispute.

Procedure is governed by the BNSS 2023. Section 173 requires the police to register an FIR for a cognizable offence. Section 175(3) allows a magistrate to order an investigation where the police refuse to act. Section 187 is the route for a private complaint before a magistrate. Section 35 deals with arrest and the safeguards around it. Section 480 and Section 482 govern plea bargaining and appeals respectively, and Section 528 preserves the old law for offences committed before the new codes came into force. Electronic evidence is admitted under Section 63 of the Bharatiya Sakshya Adhiniyam, 2023, which replaces the old certificate requirement with a certificate signed by the person in charge of the device or the relevant account.

The RBI's directions on unauthorised electronic transactions create a separate, parallel remedy. Banks must provide a helpline, acknowledge a fraud report within a defined time, and limit customer liability where the fraud is not due to the customer's negligence. The directions distinguish between frauds where the customer is not at fault, where the customer shares credentials, and where a delay in reporting increases the loss. That classification decides how much the bank must credit back. A victim should not treat the bank complaint as optional simply because a police complaint has been filed.

Step-by-step complaint procedure

Stop further payment and secure the account. Change the password of the marketplace account, revoke saved cards, and do not click any refund link sent by the seller. If a UPI mandate was created, cancel it in the UPI app immediately.
Call 1930 and file on cybercrime.gov.in. The national cyber crime helpline records the complaint and generates an acknowledgement. File the same day. Keep the acknowledgement number, because banks and courts ask for it.
Write to the bank's nodal officer. Send a written complaint by email and through the bank's app, quoting the transaction reference, amount, date and the 1930 acknowledgement. Ask for the beneficiary account to be flagged. The RBI directions require the bank to act on a reported unauthorised transaction.
File a written complaint at the police station. Attach the portal acknowledgement, bank statement, chat screenshots and the invoice or listing. Ask for a receipt under Section 173 BNSS. If the police refuse to register, send the complaint to the Superintendent of Police and then approach the magistrate under Section 175(3) or Section 187 BNSS.
Preserve the evidence before it disappears. Export the chat, keep the original packaging and product, save the listing screenshots with URLs and timestamps, and download the bank statement as a PDF. Do not delete the seller's messages even if they are abusive.
Follow up in writing. Ask the bank and the portal for the status in writing. A paper trail is what turns a complaint into a recoverable case.

Documents and timelines that matter

Stage	Document	Why it matters
First report	1930 acknowledgement and portal complaint copy	Fixes the date and time of reporting, which affects bank liability
Bank claim	Written complaint to the nodal officer, transaction statement, UPI reference	Starts the RBI-mandated complaint process and preserves the freeze request
Police	Written complaint, identity proof, screenshots, invoice	Basis for an FIR under Section 173 BNSS
Court	Complaint under Section 187 BNSS and an electronic evidence certificate under Section 63 BSA	Required if the police do not act or the case goes to trial

The timelines are not uniform. A bank must acknowledge a reported unauthorised transaction quickly, and the customer's liability depends on when the report was made. A police investigation can take months. A private complaint before a magistrate has its own procedural clock. Do not assume that filing on the portal replaces the bank complaint or the police complaint; the three tracks run in parallel and support each other.

What decides the outcome

The first factor is the speed of reporting. Money reported within hours can sometimes be frozen before it is withdrawn. Money reported after several days is usually gone, and the case becomes a prosecution rather than a recovery. The second factor is the quality of the evidence. A screenshot of a chat without the seller's profile URL, the listing, the payment reference and the bank entry is weak. A complete trail with timestamps and account details is strong.

The third factor is the platform's role. If the payment was made outside the marketplace, the platform's buyer protection may not apply. If the payment was made through the platform, the platform's dispute process and the bank's chargeback rules become relevant. The fourth factor is whether the seller can be identified. A verified KYC account gives the police a real person to investigate. A mule account opened with a stolen identity makes recovery harder and the case slower. A cyber crime lawyer in Kolkata usually assesses these factors before deciding which forum to use.

The fifth factor is the legal characterisation. A pure consumer dispute is fought before a consumer commission. A cheating case is fought before a criminal court. A bank liability claim is fought through the RBI's grievance and ombudsman process. Choosing the wrong forum wastes time and can weaken the record. The sixth factor is whether the victim kept the original product and packaging. In counterfeit cases, the physical item is often the only evidence that the goods were not as described, and photographs taken later carry less weight than the item itself.

The seventh factor is the trail of communications. Courts look for a consistent account from the first message to the last. A buyer who changed the story, deleted messages or threatened the seller before reporting creates credibility problems. A clean chronology with dates, amounts and exact promises is far more useful than a long narrative written weeks later.

Common mistakes

Do not confront the seller with threats. Intimidation can turn the victim into an accused under Section 351 BNS and gives the fraudster a counter-complaint. Do not delete chats or call records. Do not pay a recovery agent who promises to get the money back for an upfront fee; this is often a second fraud. Do not file only on the marketplace and assume the police will be informed. Do not wait for the platform's internal dispute to finish before reporting to 1930, because the money may leave the account in the meantime.

Do not send a legal notice that makes factual claims you cannot prove. Do not name the seller publicly on social media before the police verify the identity, because a wrong accusation can lead to a defamation claim. Do not ignore the bank's request for a written statement. Do not assume that a small amount is not worth reporting; repeated small frauds against the same seller build a stronger case and help investigators connect complaints. Do not confuse a refund promise with a refund. A seller who keeps promising a transfer is often buying time to move the money.

When to involve a lawyer

Involve a lawyer when the amount is significant, when the bank denies liability, when the police refuse to register an FIR, or when the seller has been identified and the case needs to move from a portal complaint to a criminal complaint or a civil recovery suit. A lawyer can draft the Section 187 BNSS complaint, prepare the Section 63 BSA electronic evidence certificate, and coordinate the bank freeze request. For straightforward low-value marketplace disputes, the portal and the consumer commission may be enough. For a case that needs evidence preservation, witness statements and a court timeline, legal help early is cheaper than rebuilding a broken record later. You can review the firm's cyber crime legal services or use the contact page to discuss the facts before filing.

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Frequently asked questions

Is e-commerce fraud a criminal offence in India?

Yes. Cheating by personation using a computer resource is punishable under Section 66D of the IT Act, 2000 with up to three years imprisonment and a fine. The general cheating offence is Section 318 of the BNS, 2023, and forgery of invoices or payment screenshots falls under Section 336 BNS. A pure delivery or quality dispute may instead be a consumer matter.

What should I do first if an online seller takes my money and disappears?

Call 1930 and file a complaint on cybercrime.gov.in the same day. Then send a written complaint to your bank's nodal officer quoting the transaction reference and the 1930 acknowledgement. Preserve the listing, chat and payment records. Early reporting gives the bank and police a chance to freeze the beneficiary account before the money is withdrawn.

Can my bank refund money lost to an e-commerce fraud?

The RBI's directions on unauthorised electronic transactions require banks to limit customer liability where the customer is not negligent and reports promptly. A refund is not automatic. The bank examines whether credentials were shared, how quickly the fraud was reported and whether the customer's own device was compromised. A written complaint and a 1930 acknowledgement strengthen the claim.

Should I file a consumer complaint or a police complaint?

File the police complaint first if there was dishonest inducement, a fake seller or a forged payment record. A consumer complaint is better for a genuine but defective purchase, a refund refusal or a service deficiency. The two remedies can run together. The facts decide which forum leads, and a lawyer can map the evidence before you commit to one route.

What evidence does the police need in an e-commerce fraud case?

The listing URL and screenshots, the full chat or call record, the payment reference, the bank statement showing the debit, the invoice or order confirmation, and the 1930 acknowledgement. In a counterfeit case, keep the parcel and the product. For electronic evidence, Section 63 of the BSA, 2023 requires a certificate from the person in charge of the device or account.

Can I file a case if the fraud amount is small?

Yes. There is no minimum amount for reporting cheating, and small losses can still be prosecuted. In practice, investigators prioritise cases with a clear trail and connected complaints. Even a small report creates a record that helps other victims. The bank's liability rules and the portal process apply regardless of the amount, though the effort should be proportionate.

What if the police station refuses to register my complaint?

Ask for the refusal in writing, then send your complaint to the Superintendent of Police. If the refusal continues, approach the magistrate under Section 175(3) of the BNSS, 2023 to direct an investigation, or file a private complaint under Section 187 BNSS. Keep copies of every representation and the portal acknowledgement, because the magistrate will ask what steps you already took.

How long does an e-commerce fraud case take?

There is no fixed timeline. A bank freeze request may be answered within days, a police investigation can take months, and a trial can take longer. The speed depends on whether the beneficiary account is traceable, whether the seller is identified, and whether the evidence is complete. Filing early and following up in writing are the factors most within the victim's control.

Information for general guidance only and not legal advice. Provisions cited follow the Information Technology Act 2000, the Bharatiya Nyaya Sanhita 2023 and the Bharatiya Nagarik Suraksha Sanhita 2023.

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