Is it legal for a company to charge extra for exchanges?

I ordered an item from Instagram in size XS, which was my correct size according to the chart. I requested to cancel the order within one hour, before it was even processed, but they denied it. I decided to go ahead with the purchase. However, when I received the item, it was too small. I sent multiple emails requesting an exchange for a medium size. Now, they are asking for an additional 200 rupees (which was only mentioned on the website, but it's hard to find). They said the exchange is possible only with this extra payment. However, their website still only shows the XS size available, even though they have all sizes for exchange.