Consumer Watchdog Books IndiaMART and Justdial as It Cracks Down on Online Sales of Explosive Materials

India's consumer protection regulator has launched a crackdown on online marketplaces over the sale of dangerous explosive materials, putting some of the country's best-known business-to-business platforms under scrutiny.

The Central Consumer Protection Authority (CCPA) has taken action against seven e-commerce platforms over listings and sales of unauthorised explosive substances, the Ministry of Consumer Affairs, Food and Public Distribution said in a statement reported by Inc42 on October 20. The platforms named are IndiaMART, Justdial, Dial4Trade, ExportersIndia, TradeIndia, Sigma-Aldrich India (Sigma-Aldrich Chemicals) and Ibuychemikals.

The substances involved include ammonium nitrate, gunpowder, picric acid and pentaerythritol tetranitrate (PETN). Apart from ammonium nitrate, which also has legitimate uses as a fertiliser and in mining, these materials are used exclusively to make explosives, according to the report.

Thousands of listings removed

The scale of the problem was significant. A total of 3,940 sellers and listing entries have been removed. IndiaMART accounted for the largest number, with 3,092 listings delisted, followed by ExportersIndia with 421, Justdial with 206 and TradeIndia with 166.

Penalties totalling ₹30 lakh have been imposed so far. Dial4Trade was fined ₹10 lakh for facilitating sales of ammonium nitrate. ExportersIndia was fined ₹10 lakh in each of two separate cases, one involving ammonium nitrate and PETN, and the other involving picric acid.

IndiaMART and Justdial received notices, and the Director General (Investigation) probed the matter and shared reports with both companies. IndiaMART replied to the investigation report and then moved the Delhi High Court to challenge the show-cause notice. Justdial has sought adjournments and has not yet responded to the investigation. The next and final hearing is scheduled for October 23. Investigations into TradeIndia, Sigma-Aldrich Chemicals and Ibuychemikals are ongoing.

The legal framework

Under India's Explosives Act, 1884, buying and selling substances such as these requires prescribed licences. The Petroleum and Explosives Safety Organisation (PESO) is the government body responsible for regulating explosives, including licensing their manufacture, storage, sale and transport.

The CCPA expects online platforms to ensure that sellers display valid PESO-issued licences and to verify buyers' identities and licence status before any sale goes through. In other words, the regulator is placing responsibility on platforms not merely to host listings, but to actively prevent unlicensed trade in dangerous goods.

The regulator's action rests on the Consumer Protection Act, 2019. In the case of Dial4Trade, the National Consumer Disputes Redressal Commission (NCDRC) dismissed the company's appeal on October 9, holding that the listings were misleading advertisements and unfair trade practices under the Act. ExportersIndia has appealed the CCPA's orders to the NCDRC, with hearings expected in the coming period.

How platforms responded

Not all platforms operate in the same way. Sigma-Aldrich Chemicals and Ibuychemikals told the authority they sell only their own products and do not host third-party sellers, a distinction that may affect how the rules apply to them.

B2B marketplaces such as IndiaMART and Justdial host millions of listings from small and medium-sized businesses across India. Their business models depend on enabling sellers to list products quickly and connect with buyers. Monitoring every listing for regulated or prohibited goods is a significant challenge, particularly for chemicals, which often have legitimate industrial uses alongside potential misuse.

IndiaMART's decision to challenge the notice in court suggests it disputes aspects of the regulator's approach. The outcome could clarify the extent of platforms' liability for third-party listings of regulated products.

Why it matters for public safety

The availability of explosive materials through online platforms raises serious security concerns. Ammonium nitrate has been involved in major industrial accidents around the world, including the 2020 explosion at the port of Beirut, which killed more than 200 people. Explosive materials have also been used in terrorist attacks, making control of their sale a matter of national security as well as consumer protection.

India strictly regulates explosives, and the licensing regime is designed to ensure that such materials reach only authorised users, such as mining companies, construction firms and licensed manufacturers. Online marketplaces that allow unlicensed sales could undermine that system.

A broader push on platform accountability

The crackdown is part of a wider effort by Indian regulators to hold digital platforms accountable for what they host. The CCPA has acted against e-commerce companies over issues such as dark patterns, misleading advertisements and the sale of unsafe products. The food safety regulator has issued notices to quick commerce and e-commerce companies over misleading claims.

Globally, regulators are also tightening rules on online marketplaces. The European Union's Digital Services Act requires large platforms to take steps to prevent the sale of illegal products, and other jurisdictions are moving in similar directions.

For platforms, the trend means investing more in seller verification, automated detection of prohibited listings and compliance teams. These costs can be significant, but failing to act carries growing legal, financial and reputational risks.

The challenge of policing online marketplaces

Online marketplaces and directories host millions of listings, many uploaded by third-party sellers with limited verification. Platforms typically rely on a mix of automated filters, keyword blocks and user reports to detect prohibited items, but sellers often use alternative descriptions or misspellings to evade detection.

Regulators in India have increasingly pushed platforms to take greater responsibility for what is sold through their services, arguing that intermediaries cannot simply disclaim liability for listings that put consumers or the public at risk. For platforms, stronger seller verification and proactive monitoring add cost, but failures can lead to penalties and reputational damage.

What comes next

The October 23 hearing will be a key moment for IndiaMART and Justdial. Outcomes could include penalties, directions to strengthen verification processes, or other remedies. The Delhi High Court's handling of IndiaMART's challenge will also be closely watched.

Consumers can report listings of explosive materials through the national consumer helpline on 1915, the ministry said. The government has framed the action as part of its commitment to preventing digital marketplaces from providing unauthorised access to dangerous substances.

For India's fast-growing digital commerce sector, the message is clear: platforms that connect buyers and sellers will increasingly be expected to take responsibility for ensuring that what is sold through them is legal and safe. For online platforms operating in India, the message from regulators is clear: hosting listings for dangerous goods carries real consequences, and proactive compliance is now expected.