Introduction
The
Consumer Protection Act is a legislation in India designed to safeguard
consumers from unfair practices and hazardous products. It enables consumers to
lodge complaints against suppliers and provides a mechanism for resolving
disputes.
The Word “CONSUMER” is
A consumer
is defined as an individual or a group of individuals who acquire goods and
services for personal use, rather than for manufacturing or resale purposes.
According to Section 2(7) of the Consumer Protection Act, 2019, a consumer is any
person who purchases goods or services in exchange for payment and uses those
goods or services for personal purposes, including resale or commercial use.
The definition explicitly states that the terms “buys any goods” and “hires or
avails any services” encompass all online transactions conducted through
electronic means, as well as direct selling, teleshopping, and multi-level
marketing.
Objective of The Consumer Protection Act, 2019
The primary purpose of the Act is to
safeguard consumer interests and establish a robust framework for resolving
consumer disputes. The Act seeks to:
1.
Protect consumers from the marketing
of products that pose risks to life and property.
2.
Ensure consumers are informed about
the quality, potency, quantity, standards, purity, and pricing of goods to
shield them from unfair trade practices.
3.
Create Consumer Protection Councils
dedicated to upholding the rights and interests of consumers.
4.
Guarantee, where feasible, access to
goods at competitive prices.
5.
Provide mechanisms for consumers to
seek redress against unfair trade practices or exploitation.
6.
Appoint authorities to ensure timely
and effective administration and resolution of consumer disputes.
·
Establish penalties for violations
of the Act.
·
Ensure that
consumer welfare is prioritized in relevant forums when disputes arise.
·
Promote
consumer education to raise awareness of consumer rights.
·
Facilitate
the swift and effective resolution of consumer complaints through alternative
dispute resolution methods.
Consumer
Rights Under Consumer Protection Act,2019
Under the
Consumer Protection Act, 2019, consumers are granted six essential rights as
specified in Section 2(9) of the Act.
These rights include:
1.
The right to protection from the marketing
of goods and services that may be hazardous to health and safety, as well as to
property.
2.
The right to be informed about the
quality, quantity, potency, purity, standards, and pricing of goods and
services, ensuring protection against unfair trade practices.
3.
The right to access a wide range of
goods and services at competitive prices.
4.
The right to seek redress through
appropriate forums for complaints regarding unfair or restrictive trade
practices.
5.
The right to receive adequate
compensation or consideration from consumer forums if they have been wronged by
a seller.
6.
The right to receive education about
consumer rights and responsibilities.
The Unfair trade Practices Under
Consumer Protection Act,2019
Section 2(47) of the Consumer Protection
Act, 2019 defines ‘unfair trade practices’ to include:
1.
The manufacture of counterfeit goods
or the provision of services that are substandard.
2.
The omission to provide cash memos
or receipts for goods purchased or services rendered.
3.
The refusal to accept the return of
goods or services and the failure to refund the payment made for such goods or
services.
4.
The unauthorized disclosure of a
consumer’s personal information.
5.
Provisions of Consumer Protection
Act,2019
Provision Of the Consumer Protection Act, 2019 are :-
Consumer Protection Councils
The
Consumer Protection Act, 2019 establishes consumer protection councils at both
the national and state levels to safeguard consumer rights.
Central Consumer Protection Council
Pursuant
to Chapter 2, Section 3 of the Consumer Protection Act, 2019, the Central
Government is mandated to constitute the Central Consumer Protection Council,
hereinafter referred to as the “Central Council.” This Council serves as an
advisory body and shall comprise the following members:
1. The Minister responsible for the Department of Consumer
Affairs within the Central Government, who shall act as the Chairperson of the
Council; and
2. A number of official and non-official members
representing relevant interests as delineated under the Act.
The
Central Council is authorized to convene as deemed necessary; however, it is
required to conduct a minimum of one meeting annually. The primary objective of
the Central Council is to protect and promote the interests of consumers as
stipulated under the Act.
State Consumer Protection Councils
Each state
government shall establish a State Consumer Protection Council, hereinafter
referred to as the “State Council,” which shall possess jurisdiction over the
respective state. The State Council shall serve in an advisory capacity. The
membership of the State Council shall consist of:
1. The Minister designated as responsible for Consumer
Affairs within the State Government, who shall act as the Chairperson of the
Council;
2. A variable number of official or non-official members
representing pertinent interests as specified under the Act.
3.
The
Central Government shall appoint no fewer than ten members for the purposes of
this Act.
The State Councils are required to convene at least two
meetings each year.
District Consumer Protection Council
Pursuant
to Section 8 of the Act, the state government is mandated to establish a
District Consumer Protection Council for each district, hereinafter referred to
as the “District Council.” The composition of the District Council shall
include:
1. The Collector of the district, who shall serve as the
Chairperson of the District Council.
2. Additional members representing relevant interests as stipulated
under the Act.
Central Consumer Protection Council
The
Central Government shall establish a Central Consumer Protection Authority,
hereinafter referred to as the “Central Authority,” pursuant to Section 10 of
the Consumer Protection Act, 2019. The Central Authority shall be empowered to
regulate matters pertaining to the infringement of consumer rights, unfair
trade practices, and deceptive or misleading advertisements that adversely
affect the interests of the public and consumers. Its mandate includes the
promotion, protection, and enforcement of consumer rights. The Central
Government shall appoint a Chief Commissioner and such other Commissioners as
deemed necessary in accordance with the provisions of the Act.
Furthermore,
the Central Authority shall establish an “Investigative Wing” as mandated by
Section 15 of the Act, tasked with conducting inquiries and investigations.
This Investigative Wing shall be composed of a Director-General and a requisite
number of Additional Director-Generals, Directors, Joint Directors, Deputy
Directors, and Assistant Directors, all of whom shall possess the requisite
experience and qualifications necessary to perform the functions delineated
under this Act.
Functions and Responsibilities’ of the Consumer Protection Act:
The functions and
responsibilities of the Central Authority, as delineated in Section 18 of the
Act, encompass the following:
1. Consumer Protection, and the Act safeguards consumers
from dangerous products and unethical practices.
2. Dispute Resolution, it allows consumers to file
complaints and seek resolution for issues with suppliers.
3. Establishment of Consumer Councils, the Act creates
consumer councils and other bodies to help resolve disputes.
4. Compensation for Damages, it provides for compensation to
consumers who have experienced losses or hardships.
5. To safeguard and advance the rights of consumers
collectively, and to prevent any infringement of such rights.
6. To prohibit and mitigate unfair trade practices.
7. To ensure the prohibition of false or misleading
advertisements pertaining to any goods or services.
8. To prevent any individual or entity from engaging in
false or misleading advertising.
9. To conduct inquiries or investigations into instances of
infringement of consumer rights or unfair trade practices.
10. To initiate and file complaints before the National,
State, or District Commissions, as applicable.
11. To review and assess issues that impede the effective
enjoyment of consumer rights.
12. To recommend the adoption of international treaties and
best practices in the realm of consumer rights.
13. To promote research and enhance awareness regarding
consumer rights.
14. To establish necessary guidelines aimed at preventing
unfair trade practices and safeguarding consumer interests.
Consumer Dispute Redressal Commission
Pursuant to the provisions of the
Consumer Protection Act, 2019, the state government is mandated to establish a
District Consumer Disputes Redressal Commission, hereinafter referred to as the
“District Commission,” in each district within the state. The composition of
the District Commission shall include a President and a minimum of two members
as prescribed by the Central Government.
In
accordance with Section 34 of the Act, the District Commission is empowered to
entertain complaints where the monetary value of the goods or services in
question does not exceed one crore rupees. Complaints pertaining to goods and
services may be filed with the District Commission by the consumer, a
recognized consumer association, the Central Government, the Central Authority,
the State Government, or other designated entities.
Section 36
stipulates that all proceedings before the District Commission shall be presided
over by the President, accompanied by at least one member of the
Commission.
Mediation
In
accordance with Chapter 5, Section 74 of the Consumer Protection Act, 2019, the
Central Government is required to establish a Consumer Mediation Cell at the
national level, and each state government must establish a Consumer Mediation
Cell within its jurisdiction. The mediator appointed to oversee the mediation
process shall conduct the proceedings within a timeframe and in a manner as
specified by applicable Regulations.
Section 75
of the Act pertains to the empanelment of mediators, outlining the necessary
qualifications, terms and conditions of service, the procedure for appointment,
and the fees to be paid to the empaneled mediators.
It is the
responsibility of the mediator to disclose any relevant information, including,
but not limited to, any personal, financial, or professional interests that may
impact the resolution of the consumer dispute, any circumstances that may
compromise their independence or impartiality, and any other information
essential for the protection of consumer rights.
Offences and
Penalties under the Consumer Protection Act, 2019
The offences and associated penalties as outlined in the Consumer
Protection Act, 2019 are as follows:
1.
Punishment for False and Misleading
Advertisements: In accordance with Section 89 of the Act, any manufacturer or
service provider who engages in the promotion of false or misleading
advertisements shall be liable to imprisonment for a term that may extend to
two years, along with a fine that may extend to ten lakh rupees.
2. Punishment
for Manufacturing, Selling, or Distributing Adulterated Products: Under Section 90 of the Consumer Protection
Act, 2019, any person involved in the manufacture, sale, or distribution of
products containing adulterants shall face penalties based on the following
conditions:
● If the adulterated product does not cause any injury to
the consumer, the offender shall be subject to imprisonment for a term not
exceeding six months and a fine not exceeding one lakh rupees.
● If the adulterated product causes injury that does not
amount to grievous hurt, the offender shall be subject to imprisonment for a
term not exceeding one year and a fine not exceeding three lakh rupees.
● If the adulterated product results in injury amounting to
grievous hurt, the offender shall be subject to imprisonment for a term not
exceeding seven years and a fine not exceeding five lakh rupees.
● If the adulterated product leads to the death of the
consumer, the offender shall be subject to imprisonment for a term of seven
years, which may extend to life imprisonment, and a fine not less than ten lakh
rupees.
3. Punishment for Manufacturing, Selling, or Distributing
Spurious Products: Section 91 provides that any individual who manufactures,
sells, or distributes spurious products shall be subject to penalties as
specified in this section.
Consumer Benefit from Consumer Protection Act,2019
1. Unfair Contracts: The Act establishes the definition of “unfair contracts”
under Section 2(46), which includes agreements that require consumers to
provide excessive security deposits for the fulfillment of contractual
obligations. This provision empowers consumers to file complaints regarding
such unfair practices, thereby acting as a safeguard against fraudulent
business conduct.
2. Territorial Jurisdiction: The Act permits consumers to initiate complaints in the
jurisdiction where they reside or are employed for remuneration. This provision
enhances consumers’ access to justice by allowing them to seek redress for
violations of their rights in a more accessible forum.
3. False and Misleading Advertisements: The Act provides a clear definition of “false and
misleading advertisements” and imposes strict penalties for any violations
related to such advertisements, ensuring accountability for misleading
marketing practices.
4. Product Liability: The Act defines “product liability,” establishing the
responsibility of manufacturers, service providers, or sellers to compensate
consumers for any harm caused by defective products or services they
provide.
5. Mediation and Alternative Dispute Resolution: The Act allows consumers to opt for mediation and
alternative dispute resolution methods, promoting the swift and effective
resolution of consumer disputes outside of traditional litigation.
6. E-filing of Complaints: The Act facilitates the electronic submission of
complaints and permits video conference hearings before the Commission, thereby
providing consumers with convenient and accessible means to express their
grievances.
How the Consumer
Protection Act Operates :
● Filing Complaints: Consumers can
submit complaints to designated consumer forums.
● Authority of Consumer Forums: These forums possess special powers to take action against
suppliers, including issuing orders for compensation.
● No Legal Fees Required: Consumers can file complaints
without having to pay court fees or hire a lawyer, making the process more
accessible.
Legislative
Timeline:
● The original Consumer Protection Act
was enacted in 1986.
● It was subsequently replaced by the Consumer Protection Act of 2019, which introduced
updated provisions to better protect consumers in the modern marketplace.
In
summary, the Consumer Protection Act is essential for empowering consumers and
ensuring their rights are upheld in commercial transactions.
Landmark Judgements
In the
case of Horlicks Ltd. V. Zydus Wellness Products Ltd. (2020), both
companies are producers of nutritional beverages. However, Zydus aired a
television advertisement that belittled Horlicks’ products. This advertisement
was broadcast in multiple languages, including English, Tamil, and Bengali. The
Delhi High Court referenced various rulings concerning misleading
advertisements, disparagement, and the regulations governing television
advertising. The court concluded that the advertisement was disparaging, as it
lacked substantial evidence regarding the product’s quality. Furthermore, the
court noted that electronic media significantly influences viewers’
perceptions, and such advertisements could harm consumers while causing
irreparable damage to the complainant.
A notable
case cited by the Delhi High Court in its decision was Pepsi Co. Inc. V.
Hindustan Coca Cola Ltd. (2003), where it was established that several key
factors must be considered in cases of disparagement, including the manner of
the advertisement, the intent behind it, and its storyline.
In the
case of Sapient Corporation Employees v. HDFC Bank Ltd. & Ors. (2012),
a consumer complaint was lodged by the Sapient Corporation Employees Provident
Fund Trust against HDFC Bank Ltd. The complainant alleged that the bank had
exhibited a deficiency in service by debiting their account. However, the court
ruled that there was no deficiency of service on the part of the bank, deeming
the complainant’s arguments to be unfounded. The court stated that actions in
accordance with the directives of the regulatory authority cannot be classified
as negligence or a failure in service.
Conclusion
The
Consumer Protection Act, 2019 is a revised legislative framework that provides
consumers with a wide range of benefits and rights, protecting them from unfair
trade practices, deceptive or misleading advertisements, and similar issues.
This Act allows consumers to utilize alternative dispute resolution methods and
mediation, promoting a swift and effective resolution of consumer disputes. The
provisions for e-filing complaints and the acknowledgment of e-consumers within
the Act demonstrate a forward-thinking approach by the legislature.
Additionally, the Act introduces new concepts such as “product liability” and
“unfair contracts,” thereby broadening the scope of consumer rights protection
and enabling consumers to file complaints when their rights are violated under
the Act.
As a
result, the incorporation of these provisions addresses the gaps found in the
Consumer Protection Act, 1986. The passage of the 2019 Act is crucial, as it
has significantly altered the framework for protecting consumer rights in the
country.
