The encyclopedia · Advertising & PR · Marketing decision · 2025
FirstCry said its prices were tax-inclusive, then charged GST on top at checkout
India's biggest baby-products retailer billed GST on top of the discounted price, so a '27% off' label was really about 18%. The CCPA fined it for drip pricing.
FirstCry · 2025-09-26
What happened
FirstCry, the Mahindra-backed online retailer for maternity and baby products, displayed products with the representation 'MRP inclusive of all taxes' — then levied an additional GST on the discounted price at checkout. The advertised discount was calculated on the MRP, but the tax was charged on top of the reduced amount, shrinking the benefit consumers actually saw.
On 26 September 2025 the Central Consumer Protection Authority (CCPA) fined FirstCry ₹2,00,000 under Sections 10, 20 and 21 of the Consumer Protection Act 2019, finding the practice was a misleading advertisement under Section 2(28) and an unfair trade practice under Section 2(47). The authority called it 'drip pricing', a dark pattern under the Guidelines for Prevention and Regulation of Dark Patterns, 2023.
The watchdog's investigation, supported by National Consumer Helpline data, showed the gap was systematic: a product advertised with a 27% discount was effectively sold at only an 18.2% discount once GST on the discounted price was added. FirstCry was ordered to display all prices inclusive of tax and never to repeat the practice.
Why it happened
- The discount was advertised on the MRP while the tax was charged on top of the discounted price, so the headline number overstated the real saving
- The 'MRP inclusive of all taxes' label promised what the checkout contradicted, putting the burden on shoppers to recompute the final cost
- Disclaimers in fine print ('GST and Add'l charges may apply') did not override the legal requirement that the MRP be inclusive of all taxes
- The gap was large enough to be a sale proposition — a 27% discount quietly becoming 18% is a buying decision made on false terms
The lesson
A discount only exists if the final payable amount is lower — charging tax on top of the discounted price makes the advertised saving a fiction, and regulators now name drip pricing as a dark pattern.
Sources
- The Hindu: CCPA slaps ₹2 lakh fine on FirstCry for misleading ads, unfair trade practices
- Economic Times: CCPA imposes penalty on FirstCry for misleading price representation
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