The Consumer Protection Act, 1986 seeks to protect and promote the consumers’ interest through speedy and inexpensive redressal of their grievances. It is applicable to all types of undertakings, big or small whether in the private or public sector or in the cooperative sector, whether a manufacturer or dealer or a trader and whether supplying goods or providing services. It is seen that sometimes the advertisements for the products are misleading and they convince the consumer so much to buy the product and they can be wrong, fake or misleading the consumer to spend money on the goods to buy. Sometimes the dealer do not give receipt for the goods purchase, then the number of consumers can club together and give a complaint in an affidavit to the authority as a class action and then the authority can nab the dealer and ask for the details and records of his business in order to stop his unfair trade practice. The Court will deal with only one consumer what will happen to other who are sufferers. Another example is an advertisement to do short term courses, you will get 100% job or job assistance which is wrong assurance as there is no job guarantee, it depends upon your ability, experience etc. It is also seen that the consumer buys goods or takes services, if any celebrity endorse the product as there might be an agreement between the manufacturer and the endorsing person. The consumer buys the goods on the trust that the endorse person might have tested and used the product. But later on the manufacturer changes or amend the product then the endorse person has to prove that when he advertise it was the original product. Print media is not liable for giving advertisement as on the face of media.
In Consumer Protection Act, 1986 has been amended in many fold. Initially for how the bench is going to function. In 1993 amendment were made where the services were included. It is the settled law by the Apex Court that Consumer Protection Act is an additional remedy along with other laws. The Consumer Protection Act, 2019 (the Act) received the President’s assent on 9 August 2019 which has replaced the Consumer Protection Act, 1986. The scope of the Act has been broadened by introduction of various provisions including e-commerce within its purview. The Act aims at protecting and strengthening the rights of the consumers by establishing authorities, imposing strict liabilities and penalties on product manufacturers, electronic service providers, misleading advertisers, and by providing additional settlement of consumer disputes through mediation. There are structural changes in the Consumer Courts in number of members, honorarium, and staff cadre. Procedural changes are there like to give notice with different mode and on legal issues the changes are made like giving review powers.
The Act introduces the establishment of a Central Consumer Protection Authority (CCPA) by the Central Government and Mediation centre attached to the forum/Courts and the Monitoring cell. The CCPA is a regulatory authority and shall be empowered to impose penalties, recall goods, cause withdrawal of services, provide refunds and investigate into matters. It shall also be responsible for protecting the rights of consumers as a class and shall further ensure that no person engages in unfair trade practices and that no misleading advertisements are made. The Act provides for establishing an investigation wing which shall be headed by the director general who shall be appointed by the central government for conducting investigations as per the order of the CCPA.
Further, the Act also introduces electronic mode for filing complaint for unfair trade practices or false or misleading advertisements to the District Collector, the Commissioner of the Regional Office or the CCPA. Monitoring Cell will work under National Consumer Disputes Redressal and will supervise the consumer commission and state commission functioning.
A consumer is a buyer of goods and services and also the user of goods and services with permission of the buyer but consumer is not a person who buys goods for resale purpose. An individual must understand their rights as consumer concerning the available products and their services being market and sold which includes information, safety, choice, awareness, to get relief and the right to be heard. In 1962, the first declaration of consumer rights was established in U.S. Consumer activist Ralph Nader is referred to as the father of the consumer movement.
Some of the important definitions are defined in Section 2 of the Consumer Protection Act, 2019 which are reproduced as under in sub-section:-
“(5) “complainant” means—
(i) a consumer; or
(ii) any voluntary consumer association registered under any law for the time being in force; or
(iii) the Central Government or any State Government; or
(iv) the Central Authority; or
(v) one or more consumers, where there are numerous consumers having the same interest; or
(vi) in case of death of a consumer, his legal heir or legal representative; or
(vii) in case of a consumer being a minor, his parent or legal guardian;
(6) “complaint” means any allegation in writing, made by a complainant for obtaining any relief provided by or under this Act, that—
(i) an unfair contract or unfair trade practice or a restrictive trade practice has been adopted by any trader or service provider;
(ii) the goods bought by him or agreed to be bought by him suffer from one or more defects;
(iii) the services hired or availed of or agreed to be hired or availed of by him suffer from any deficiency;
(iv) a trader or a service provider, as the case may be, has charged for the goods or for the services mentioned in the complaint, a price in excess of the price—
(a) fixed by or under any law for the time being in force; or
(b) displayed on the goods or any package containing such goods; or
(c) displayed on the price list exhibited by him by or under any law for the time being in force; or
(d) agreed between the parties;
(v) the goods, which are hazardous to life and safety when used, are being offered for sale to the public—
(a) in contravention of standards relating to safety of such goods as required to be complied with, by or under any law for the time being in force;
(b) where the trader knows that the goods so offered are unsafe to the public;
(vi) the services which are hazardous or likely to be hazardous to life and safety of the public when used, are being offered by a person who provides any service and who knows it to be injurious to life and safety;
(vii) a claim for product liability action lies against the product manufacturer, product seller or product service provider, as the case may be;
(7) “consumer” means any person who—
(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
(ii) hires or avails of any service for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such service other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person, but does not include a person who avails of such service for any commercial purpose.
Explanation.—For the purposes of this clause,—
(a) the expression “commercial purpose” does not include use by a person of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self-employment;
(b) the expressions “buys any goods” and “hires or avails any services” includes offline or online transactions through electronic means or by teleshopping or direct selling or multi-level marketing;
(8) “consumer dispute” means a dispute where the person against whom a
complaint has been made, denies or disputes the allegations contained in the complaint;
(9) “consumer rights” includes,—
(i) the right to be protected against the marketing of goods, products or services which are hazardous to life and property;
(ii) the right to be informed about the quality, quantity, potency, purity, standard and price of goods, products or services, as the case may be, so as to protect the consumer against unfair trade practices;
(iii) the right to be assured, wherever possible, access to a variety of goods, products or services at competitive prices;
(iv) the right to be heard and to be assured that consumer’s interests will receive due consideration at appropriate fora;
(v) the right to seek redressal against unfair trade practice or restrictive trade practices or unscrupulous exploitation of consumers; and
(vi) the right to consumer awareness;
(42) “service” means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, telecom, boarding or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service;”
Under the new Act, “consumer” is defined as a person who “buys any goods” and “hires or avails of any service” which shall include both online and offline transactions through electronic means, teleshopping, direct selling or multi-level marketing’ for consideration but does not include a person who obtains goods for resale or goods or service for any commercial purpose.
Another concept on “product liability” has been introduced by the Act wherein a product liability action may be brought by a complainant against a product manufacturer, product service provider or product seller, for any harm caused to the complainant on account of a defective product. The Act provides a breakup of the liabilities of the product manufacturer, product service provider and product seller and also circumstances under which they are not liable.
That Goods are those products which are manufactured or produced and sold to consumers through wholesalers and retailers. When people purchase goods and later found them to be of poor quality, unreasonably priced, measured less, defective or feels cheated by the seller or not satisfied with the goods or the services provided by the seller, etc. have a right for their grievances to be heard. The consumer should have the knowledge about his rights to have the right kind of product and if the consumer is not satisfied and feels that he should be properly compensated and have a right to raise the issue before a redressal system and the consumer have the knowledge about his own responsibilities.
The Consumers six Rights are as follows:
Rights to Protection/Safety:
The consumer must be aware of the knowledge of the product/goods he is buying including quality of the goods whether they are good for health and free of creating any environmental hazard. The consumer to be educated about the various types of hazards and problems associated with marketing/advertisement of a product like all food goods are safe for eating. It’s not hazardous and with standard norms are well testing and then sold. In electronic goods are proper tested. Cosmetic is goods and it is not giving you any rashes. It is the duty of the manufacturer or trader to give you best goods. Then in services like in electricity department should keep the wiring system and supplying norms in order. Railway you buy ticket to go to the station, the Railway department has to take care of you once you enter the platform. Similarly, as soon as you enter Airport, it is the responsibility of the Airport authority or concern airlines, if you are flying in the plane. Even hotels, restaurant are responsible for your safety and Banks are also responsible for any fraud and your money should be safe in your account and for any misuse of fraud or ATM and vice versa, transport authority is responsible for your transport. You can always demand for your safety of goods and services.
Right to be informed:
Right to be informed to the consumer of the goods and services are the responsibility of manufacturer’s, dealer’s and traders to the consumers. In goods like food items they should inform, what is the batch number, expiry date, packing date, ingredients used. Other than that what is the hall mark, ISI mark, etc. which shows that the standard is maintained by the manufacturer. In home appliances you get a pamphlet which provides who is the manufacturer, informed about the product, what is the period of warranty or guarantee given by the manufacturer and what is the cost. On the showroom items which are displayed with the price tag and any discount or scheme given also and in the website of the manufacturer or dealer, the consumer are given information about the goods or services too. The bank are also giving information on a board what is the FD rate for senior citizens and other citizens, what loans are given by the bank along with what interest or/and any other scheme available with the Bank. Even in any educational institute provides with a separate inquiry office or prospectus with full information about the subjects, about the institute and the fee structure. In airports or Railway stations there will be board displayed or inquiry counter will be there and the consumer will get all the information about the arrival, delayed, cancellation or departure. In hospitals also there will be board displayed about the Doctors on duty and there will be a inquiry counter for the help of the patients. If information is not available, the consumer has a right to get the information from the concern department, authority, institute and other places.
Right to Choose:
The consumer has freedom to choose from a variety of products at competitive prices.
Right to be Heard:
The Consumer has a right to file a complaint and to be heard in case of dissatisfaction with a good or a service. Many business firms have set up their own consumer service and grievance cells and they are helping consumers in redressal of their grievances.
Right to seek redressal:
The Consumer has a right to get relief in case the product or service falls short of his expectation or he is not satisfied. The reliefs can be in the form of replacement of the product, removal of defect in the product, compensation, taking back the product, etc.
Right to Consumer Awareness:
The Consumer should be self aware about the goods and services he or she is buying. A Consumer should take himself initiative to get the information about goods to be purchased. The Consumer has a right to acquire knowledge and to be well informed consumer. The consumer has a right and the reliefs available to him in case of a product or services fall short of his expectation. When they buy any good there is a pamphlet inside the goods or information given on the goods, a consumer must read it before using the goods. Our Constitution provides for Directive Principles of State policy where the Government provides for the welfare of the people. In education level/courses the consumer protection rights/act is taught in all the schools, degree courses etc. In institution level whether government or non-government, workshop, education of the consumer protection act are there. The Government has its department/Ministry of Consumer Affairs which is running lots of awareness programme like Jago grahak jago in media and there is a toll free number for consumer complaints too and in Centre for Consumer Research various courses and workshops are there on consumers’ protection. The consumer is also responsible to be aware and go for correct scheme and not to be cheated.
There is an introduction of “e-commerce” and “electronic service provider”. By including e-commerce within its purview, the Act seeks to protect the rights of the e-consumers and also enables them to proceed against the e-commerce websites in the event of any violation.
The Act has defined the term” misleading advertisement” in relation to any product or service as, “an advertisement which falsely describes the product or service which gives a false guarantee and is likely to mislead the consumer as to the nature substance, quantity or quality of such product or service and conveys an express or implied representation which, if made by the manufacturer or seller or service provider, would constitute an unfair trade practice and shall also include information which is concealed deliberately”. The penalties for false and misleading advertisements are also discussed under offences and penalties.
An appeal to an order passed by the CCPA on this issue can be filed under the National Commission within a period of 30 days from the date of receipt of such order.
The Act provides for setting up of a Consumer Dispute Redressal Commission (CDRC), which shall be set up at the district, state and national level (Commissions) with the purpose to promote, protect and enforce the rights of the consumers. The CDRC is empowered to conduct inquires and investigations into any violations relating to consumers rights, complaints with respect to unfair and restrictive trade practices, misleading advertisements and goods which are a hazardous to life and safety. The pecuniary jurisdiction of the Commissions has been enhanced in comparison with the Consumer Protection Act, 1986. The District Commission now has the jurisdiction to entertain complaints where the value of the goods or services paid as consideration does not exceed INR1 crore. The State Commission shall have the jurisdiction to entertain complaints where the Consideration exceeds INR1 crore but does not exceed INR10 crores and the National Commission shall have the jurisdiction to entertain complaints where the Consideration paid exceeds INR10 crores. The jurisdiction, in which the complaint is to be filed is now based on the value of the goods or services paid unlike in the earlier Act, where it was on value of the goods or services and the compensation, if any, claimed. The Act has introduced a separate set of penalties with respect to misleading advertisements. Any failure to comply with the directions of the CCPA for recall of goods, withdrawal of services shall attract an imprisonment for a term which may extend to six months or with a fine which may extend to INR20 lakhs.
Further, the complaint can now also be instituted in a District Commission within the local limits of whose jurisdiction the complainant resides or personally works for gain, apart from filing in the jurisdiction where the other side actually or voluntarily resides, or carries on business, or has a branch office or personally works for gain.
The Act has further introduced mediation as an alternate dispute resolution mechanism, in order to resolve the consumer dispute faster. After, the dispute is resolved either in whole or in parts; the terms of such agreement shall be reduced into writing accordingly and will be referred to the Ld. Commission/forum. In the event the mediation is not successful, the respective commission shall hear the matter and pass a suitable order and dispose the matter accordingly.
The Act has wider scope for the consumer protection and rights and is a welcome change in favor of the consumers.The electronic filing of complaints and permission to attend the hearing through video conference are vital steps in simplifying the process of complaints. Mediation is very important step to resolve their grievances on a fast-track basis. Online marketplaces and online auction sites, which have all throughout been included under the purview of an “aggregator”, have also been included under the purview of this Act which will place more responsibility on them with respect to the goods and services being sold and provided by them. Further, the Act also seeks to hold the product manufacturers and service providers and product sellers liable where the rights of the consumer have been violated due to defects or deficiency in the goods and services provided. The provision for seeking compensation for the loss or injury was only through the civil courts, which is now under the purview of the Act. However, whether the new Act, 2019 is cost effective or not will be seen when the new provisions will be implemented.
The Author is a Advocate, Supreme Court of India.