Vihaan, the sub-franchisee of QNET in India is involved in the business of buying and selling of goods and services and uses the direct selling model for sale of its products. Vihaan sells various products to the end customers on payment of the purchase price through its e-commerce portal. The products are then sent to the buyers within a short, reasonable period, thereby completing the process of sale between Vihaan and the buyer. Hence, the entire procedure is strictly in compliance of the provisions of the Sale of Goods Act. The purchaser thereafter has no right to the money paid to the company and the same cannot be treated as a ‘deposit’ for the purposes of Maharashtra Protection of Depositors (in Financial Establishments) Act, 1999, as the said transaction of taking advance against order for goods and services falls within the exception of section 2(c)(v)(d) of the MPID Act.
Therefore, no offence under the MPID Act can be attributed to the company when there is no deposit scheme involved in the business of Vihaan, which is the most important aspect for bringing a company under the purview of the MPID Act. Further Vihaan is not a financial establishment as it does not accept any deposit and neither does it accept any money or valuable commodity for any return in any form in the future.