Consumer Protection Act, 2019

Who is a consumer?

Anyone who buys goods or services in exchange for a consideration is termed as a consumer. According to Consumer Protection Act, 1986, a consumer means any person, who buys any product or hires/avails of any service for a consideration. It also includes any user of such goods or beneficiary of such service other than the person who buys such goods or hires any service for consideration, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or avails such service for any commercial purpose

The Consumer Protection Act-

The Consumer Protection Act was passed by the Indian Parliament in 1986 and came into effect on December 24, 1986. The primary objective of the Act was to provide better protection for consumers and establish a legal framework for addressing their grievances. It introduced the concept of consumer rights, including the right to safety, right to information, right to choose, and right to seek redressal.

Over the years, the Consumer Protection Act underwent amendments to strengthen consumer rights and improve dispute resolution mechanisms. However, concerns were raised about the need to modernize the legislation to address emerging challenges such as e-commerce, digital transactions, and globalized markets.

In response to these concerns, the Indian government passed the new Consumer Protection Act in 2019, which replaced the original 1986 law. The Consumer Protection Act, 2019, aims to enhance consumer rights, promote fair trade practices, and streamline dispute resolution mechanisms. It introduces provisions to address issues such as misleading advertisements, unfair contracts, and product liability in the context of evolving market dynamics

The CPA, 2019 is “An Act to provide for the protection of the interests of consumers and for the said purpose, to establish authorities for timely and effective administration and settlement of consumers’ disputes and for matters connected therewith or incidental thereto.”

Consumer Rights:

The Consumer Protection Act has laid down certain ‘Consumer Rights’. Consumer Rights refer to the set of entitlements and protections that ensure fair treatment and safety for consumers in the marketplace. These are as follows:

1. Right to Safety – A consumer has the right to safety against such goods and services that are hazardous to his health, life and property. For example, counterfeit and substandard drugs; appliances made of low quality raw material, such as iron, pressure cooker, etc. and low quality food products like bread, milk, jam, butter, etc. The consumers have the right to safety against the loss caused by such products.
2. Right to be informed – A consumer has the right to be provided with all the information on the basis of which he decides to buy goods or services. Such information may relate to quality, purity, potency, standard, date of manufacture, method of use, etc. of the commodity. Thus, a producer is required to provide all these information in a proper manner, so that the consumer is not cheated.
3. Right to choose – A consumer has the absolute right to buy any goods or services of his choice from among the different goods or services available in the market. In other words, no seller can influence his choice in an unfair manner. If any seller does so, it will be deemed as interference in his right to choice.
4. Right to be heard – A consumer has the right that his complaint be heard. This right also empowers the consumers to fearlessly voice their complaints against the defective products and the erring producer/company /seller.
5. Right to seek redressal – This right provides compensation to the consumers against unfair trade practice of the seller. For instance, if the quantity and quality of the product do not conform to those promised by the seller, the buyer has the right to claim compensation. Several redressals are available to the consumer by way of compensation, such as free repair of the product, taking back of the product with refund of money, changing of the product by the seller.
6. Right to consumer education – It means to have access to programs and information that help consumers make better decisions before and after purchase. Instructions and guidelines for consumers are issued by the government departments and NGOs.

The Consumer Protection Act ensures protection against market malpractices such as:

Restrictive Trade: manipulation of price or its conditions of delivery to impose on the consumer’s unjustified costs or restrictions

Unfair Contracts: means a contract between a manufacturer or trader or service provider on one hand, and a consumer on the other, having such terms which cause significant change in the rights of such consumer

Misleading Advertisements

Black marketing and Hoarding of goods and services Unfair prices

Unfair trade practices (e.g. Food Adulteration)

“unfair trade practice” means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice including any of the following practices, namely:—

1. making any statement, ( statement meaning a statement that is,—
   1. expressed on an article offered or displayed for sale, or on its wrapper or container; or
   2. expressed on anything attached to, inserted in, or accompanying, an article offered or displayed for sale, or on anything on which the article is mounted for display or sale; or
   3. contained in or on anything that is sold, sent, delivered, transmitted or in any other manner whatsoever made available to a member of the public,

shall be deemed to be a statement made to the public by, and only by, the person who had caused the statement to be so expressed, made or contained; )

, whether orally or in writing or by visible representation including by means of electronic record, which—

1. falsely represents that the goods or services are of a particular standard, quality, quantity, grade, composition, style or model;

2. falsely represents any re-built, second-hand, renovated, reconditioned or old goods as new goods;

3. represents that the goods or services have sponsorship, approval, performance, characteristics, accessories, uses or benefits which such goods or services do not have;

4. makes a false or misleading representation concerning the need for, or the usefulness of, any goods or services;

5. makes to the public a warranty or guarantee of a product or of any goods or services; or a promise to replace, maintain or repair an article or to repeat or continue a service until it has achieved a specified result, if such warranty or guarantee or promise is materially misleading or if there is no reasonable prospect that such warranty, guarantee or promise will be carried out;

2. permitting the offering of gifts, prizes or other items with the intention of not providing them as offered or creating impression that something is being given or offered free of charge when it is fully or partly covered by the amount charged, in the transaction as a whole;

3. permitting the hoarding or destruction of goods, or refusal to sell the goods or to make them available for sale or to provide any service, if such hoarding or destruction or refusal raises or tends to raise or is intended to raise, the cost of those or other similar goods or services;

4. manufacturing of spurious goods or offering such goods for sale or adopting deceptive practices in the provision of services;

5. not issuing bill or cash memo or receipt for the goods sold or services rendered in such manner as may be prescribed;
6. 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—

1. fixed by or under any law for the time being in force; or
2. displayed on the goods or any package containing such goods; or
3. displayed on the price list exhibited by him by or under any law for the time being in force; or
4. agreed between the parties;

6. the goods, which are hazardous to life and safety when used, are being offered for sale to the public–
   1. 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;
   2. where the trader knows that the goods so offered are unsafe to the public;

CENTRAL CONSUMER PROTECTION AUTHORITY

Establishment: By Central Government → Central Consumer Protection Authority known as Central Authority

Purpose: Regulate matters relating to violation of rights of consumers, unfair trade practices and false or misleading advertisements which are harmful to the interests of public and consumers and to promote, protect and enforce the rights of consumers as a class.

Composition: Chief Commissioner and such number of other commissioners as may be prescribed and to be appointed by the Central Government.

The Central Authority shall have an investigation wing headed by a Director-General for the purpose of conducting inquiry or investigation under this Act.

Complaints to authorities

Conditions for a complaint: violation of consumer rights OR unfair trade practices OR false or misleading advertisements, which are harmful to the interests of the consumers as a class.

Complaint may be forwarded either in writing or electronic mode → to any one of the authorities, namely the District Collector or the Commissioner of regional office or the Central Authority.

Section 20: Power of Central Authority to recall goods, etc.

If the Central Authority is satisfied on the basis of investigation that there is sufficient evidence to show violation of consumer rights or unfair trade practice by a person, it may pass orders such as –

Recalling of goods or withdrawal of services which are dangerous, hazardous or unsafe.

Reimbursement of the prices of goods or services so recalled to purchasers of such goods or services; and

Discontinuation of practices which are unfair and prejudicial to consumers’ interest.

The Central Authority shall give the person an opportunity of being heard before passing of an order under this section.

Section 21: Power of Central Authority to issue directions and penalties against false or misleading advertisements

If the Central Authority is satisfied after investigation that any advertisement is false or misleading and is harmful to the interest of any consumer or violates consumer rights, it may, by order, issue directions to the concerned trader or manufacturer or endorser or advertiser or publisher, as the case may be, to discontinue such advertisement or to modify the same as given in the order.

Notwithstanding the order passed in sub-section 1), if the Central Authority is of the opinion that it is necessary to impose a penalty for such false or misleading advertisement, by a manufacturer or endorser, it may, by order, impose such a penalty on them which may extend to ten lakh rupees.

The Central Authority may, for every subsequent contravention, impose a penalty which may extend to fifty lakh rupees.

Notwithstanding any order under sub-section 1) and 2), if the Central Authority thinks it is necessary, it may, by order, prohibit the endorser of a false or misleading advertisement from making endorsement of any product or service for a period which may extend to one year.

The Central Authority may, for every subsequent contravention, prohibit such endorser from making endorsement for a period which may extend to three years.

Central Consumer Protection Authority (CCPA) issues 20 notices to IAS coaching institutes for misleading advertisements and imposed penalties on 8 such institutes. https:// pib.gov.in/PressReleaseIframePage.aspx?PRID=1985926

CONSUMER DISPUTES REDRESSAL COMMISSION

District Consumer Disputes Redressal Commission (Section 28)-

The State Government shall, by notification, establish a District Consumer Disputes Redressal Commission, to be known as the District Commission.

Its Jurisdiction: For complaints where the value of goods and services paid as consideration, exceeds rupees 1 crore but does not exceed rupees 10 crore. It can be filed in local limits of that commission where in the opposite party ordinarily resides or carries on business or has a branch office or personally works for gain; or where the complainant resides or personally works for gain; or where cause of action, wholly or in part arises.

A complaint can be filed in form of writing or online via govt. Provided portal @ https:// consumerhelpline.gov.in/ or through mobile apps launched by the government of India like NCH app, Umang app or Consumer app.

The status of a complaint can be checked online and the fees for submission of the complaint can also be submitted through an online payment portal.

It is recommended that a notification be sent to the opposing party before filing the complaint, outlining the defects/deficiencies in the products or services offered. If the parties are unable to reach an agreement, the complainant may submit a complaint with a jurisdiction authority/forum.

The complaint should include the following information:

1. Name, description, and address of the complainant
2. The name, description, and address of the opposing party or parties
3. Facts about the complaint, such as when and where it occurred
4. Documents to back up allegations, if any
5. Specifics of the dispute: a flaw in the goods/a deficiency in the service
6. The relief being sought

The consumer must approach the District Commission with their complaint. It can be admitted or can be rejected. However, this decision is taken only after giving the opportunity to be heard. The admissibility is decided in 21 days of filing the complaint. If it is not decided in 21 days, it is deemed to have been accepted.

The commission will then send a notice to the opposite party. If the commission feels that there exists any elements of settlements between the parties, 5 days are given for consent to be given by both parties to move for mediation.

There are consumer mediation cells attached to District, State and National Commission that conduct mediation. Pursuant to mediation, if an agreement is reached between the parties with respect to the issues involved in the consumer dispute, the terms of such agreement are reduced to writing accordingly, and signed by the parties. A settlement report is then prepared and shared to the commission.

The District Commission or the State Commission or the National Commission, as the case may be, shall, within seven days of the receipt of the settlement report, pass suitable order recording such settlement of consumer dispute and dispose of the matter accordingly.

If the mediation fails,

A copy of the complaint is sent to the opposite party within 21 days of filing the complaint. They are then given 30 days to present their version of the case.

Every complaint shall be disposed of within a period of three months from the date of receipt of notice by the opposite party where the complaint does not require analysis or testing of commodities.

If the testing of the products is required: Sample of the good is obtained and sent to the laboratory for testing and analysis if the complainant claims for a defect in the product and such test results are to be given in 45 days. It is required for such a case to be resolved in 5 months.

The Commission may order to :

• Remove the defect as pointed out by the laboratory.
• Replace the Goods
• To return to the complainant the price charged for the goods
• To award any compensation to the consumer for the loss suffered due to the negligence of the opposite party
• Not to offer hazardous goods for sale
• To issue corrective advertisements or to neutralise the effect of misleading advertisement

Any person aggrieved by the order of the District Commission may prefer to appeal against such an order to the State Commission within a period of 45 days from the date of the order and no appeal by a person, who is required to pay any amount in terms of an order of the District Commission, shall be entertained by the State Commission unless the appellant has deposited fifty per cent of that amount.

State Consumer Disputes Redressal Commission (Section 42)

It has the jurisdiction –

• For complaints where the value of goods and services paid as consideration, exceeds rupees 1 crore but does not exceed rupees 10 crore.
• Appeals against the orders of any District Commission within the state

Any person aggrieved by the order of the State Commission may prefer to appeal against such an order to the National Commission within a period of 30 days from the date of the order

National Consumer Disputes Redressal Commission-

Established by the Centre

Any person aggrieved by the order of the National Commission may prefer to appeal against such an order to the Supreme Court within a period of 30 days from the date of the order

An appeal filed before the State Commission or the National Commission shall be made to dispose of the appeal within a period of 90 days from the date of its admission.

PRODUCT LIABILITY

Product liability refers to the legal responsibility of manufacturers, distributors, and sellers for the safety and quality of the products they offer to consumers.

Application of the Chapter (Section 82)- It will be applicable over every compensation claim when a Complainant brings up a Product Liability Action for any harm caused by a defective Product or Services by a Product Manufacturer, Service Provider or Product Seller.

THE LIABILITY OF A PRODUCT MAY FALL OVER THE FOLLOWING PERSONS:

1. Product Manufacturer- A product manufacturer is a company or entity engaged in the process of creating, producing, or fabricating goods. Manufacturers are involved in the various stages of production, which may include designing, assembling, testing, packaging, and distributing products.

84(1) Liability of a Product Manufacturer –

A product manager shall be liable in a Product Liability Action if the product –

• contains Manufacturing Defect
• is defective in design
• has deviations from manufacturing specifications
• does not conform to the express warranty
• fails to contain adequate instructions for correct usage.

84(2) states that Even if the Product Manufacturer proves his non-negligence in making the express warranty of a product, he will still be liable in a Product Liability Action.

2. Product Service Provider- is an entity or individual that offers services to others. Services can encompass a wide range of activities and may include professional, technical, or specialized assistance provided to customers, clients, or other businesses.

Section 85- Liability of a Product Service Provider – a product service provider shall be held liable in a product liability action if the service provided by him

was Faulty/Imperfect/deficient/ inadequate in quality, nature, or manner of performance which is required to be provided.

was an act of omission/ Commission/ negligence conscious withholding of any information which caused harm to the Consumer.

contained inadequate instructions or warnings to prevent any harm

did not conform to the express warranty or the terms and conditions of the contract.

3. Product Seller- A “product seller” typically refers to an entity or individual involved in the business of selling products.

Section 86- Liability of product seller – A product seller who is not a product manufacturer shall be liable in a product liability action if-

-There was an exercise of enough control by the seller in the manufacturing, designing, testing, and labeling of the product, and this caused harm to the consumer.

-While selling the product, the product seller has made certain modifications to the manufactured product and the harm caused is a direct consequence of that.

-There was no express warranty by the product manufacturer, but the product seller gave an express warranty which was not met.

-A personal obligation may come on the seller if the manufacturer cannot be recognized or made known, that is the manufacturer is undisclosed OR it is impossible to sue the manufacturer due to some justifiable reason OR the law in force does not apply to him. For example, if the seller is selling a product to a foreign manufacturer, the Indian law would not apply to him. In such a case the Indian seller would be made liable.

-The product seller did not take proper care of the product, inspect or maintain it, or was negligent in passing certain warnings as given by the manufacturer to the consumer and the harm resulting from it.

Section 87- Exceptions to Product Liability Action

Against the Product Seller- A product liability action cannot be brought against the product seller if at any time of harm, the product was misused, altered, or modified.

Against the Product Manufacturer –

The employer had bought the product to be used for work and adequate warnings were issued to the employer but the employee, who brought the suit was not made aware of the same.

The product was a component to be used in a separate product. All warnings regarding the component product were already given. The harm was not caused by the component product separately but only after using it with the other product.

The product was to be only used under the guidance of an expert and all warnings were given to the expert.

The consumer himself was not in his senses while using the product due to the intake of some intoxicating agent or drug that was not prescribed by a medical practitioner to him. Due to such intoxication or drug effect, harm was caused.

The danger of a Product is to be known by a Reasonable Consumer- the manufacturer is not compelled to give any warning of that danger. For example, it is no fault of the manufacturer if a consumer does not know that a knife if run on the skin can cause cuts.

PENALTIES

Now let’s see what the penalties and punishments are for the violation of consumer rights. The Central Consumer Protection Authority (CCPA) is the authority responsible for regulating all consumer-related laws. If anyone does not follow the orders/guidelines given by the central authority under Sec 20 (withdrawal of goods and services) and Sec 21 (false or misleading advertisements), they will be punished under Sec 88 of CPA (Penalty for non-compliance of directions of the Central Authority).

They may face imprisonment for up to 6 months and a fine of up to 20 lakh rupees or both. The court cannot take action until and unless there is a complaint filed by the Central authority under Sec 92 of CPA (Cognizance of offence by court).

The sellers of products mainly use false advertisements to manipulate us. They mislead us so that they can sell their product. The one who does this has to face punishment under sec 89 of CPA (Punishment for false or misleading advertisement). They may face imprisonment up to 2 years and a fine up to 10 lakh rupees and a repeat offender may face imprisonment up to 5 years and fine up to 50 lakhs. The court cannot take action until and unless there is a complaint filed by the Central authority under Sec 92 of CPA (Cognizance of offence by court).

If the manufacturer is making any product for selling, storing, distributing or importing containing materials that may make the product unsafe for consumption will be punished under sec 90 (Punishment for manufacturing for sale or storing, selling or distributing or importing products containing adulterants).

If the consumer does not face any injury after the consumption of the good, the manufacturer/seller may face imprisonment for up to 6 months and a fine of up to Rs 1 lakh.

If the consumer faces injury that does not lead to serious hurt after consuming the good, the manufacturer/seller may face a punishment of up to 1 year and a fine of up to Rs 3 lakhs.

If the consumer faces injury that results in a serious problem after consuming the good, the manufacturer/seller may face imprisonment for up to 7 years and a fine up to Rs 5 lakhs, which is a cognizable and a non-bailable offence.

And if the consumer dies after consuming the good, the manufacturer/seller may face imprisonment of min 7 years up to life imprisonment and a fine of min Rs 10 lakh, which is also a cognizable and a non-bailable offence.

Despite this, on the first conviction, the central authority may suspend the license of the manufacturer/seller for 2 years and on the second conviction, the license will be cancelled.

We are very fond of branded things which are too expensive. This sometimes leads us to buy a fake copy of that product which is also of bad quality. Did you know that manufacturing/selling goods that claim to be genuine but are not, is punishable?

It is punishable under Sec 91 of CPA (Punishment for manufacturing for sale or for storing or selling or for distributing or importing spurious goods). The person by himself or through any other person manufactures for sale or stores, distributes or imports any of this type of goods is punishable. For eg- a brand that sells fake medicines with the name of a genuine brand may result in serious problems for the consumer.

If the consumer of such a product faces injury not leading to a serious problem, the manufacturer/seller may face imprisonment for up to 1 year and a fine of up to Rs 3 lakhs.

If the consumer faces injuries leading to serious problems after consuming the product, the manufacturer/seller may face Imprisonment for up to 7 years and a fine up to Rs 5 lakhs, which is a cognizable and a non-bailable offence.

If the consumer dies after consuming the product, the manufacturer/seller may face imprisonment of min 7 years up to life imprisonment and a fine of min Rs 10 lakhs, which is also a cognizable and non-bailable offence.

Despite the above punishments, the central authority may suspend the license of the manufacturer/seller for 2 years on the first conviction and may cancel the license on the second conviction.

Does this mean that the central authority or any other officer can falsely search your workplace without any reasonable grounds? No! The Director General or any other officer on his behalf or the District Collector who knows that there is no reason to search an area or seize any record, register or other document or article is punishable under Sec 93 of CPA (Vexatious Search). Anyone who violates this May face imprisonment for up to 1 year and a fine of up to Rs 10 thousand or both.

CONCLUSION:

So, starting from understanding who a consumer is, to the rights of a consumer and then learning about authorities in place, being Central Consumer Protection Authority to dispute redressal commissions at District, State and National level, and then concepts like mediation, product liability and finally ending with punishments, we have covered the entire Consumer Protection Act 2019 in an in-depth manner. Not only do we now know

what are our rights but we also know how to ensure that these rights are secured. From now onwards we expect that if as a consumer you see any unfair trade practice or face any issue, you will make a complaint in the presecribed form to the consumer dispute redressal commission and will seek relief through the procedure explained. With this, we come to an end of this camp!

For any queries, please contact –

9322292767- Aditya Jadhav ( Member, Aspire Legal Club ) 9284243549- KiranKumar Hole ( Member, Aspire Legal Club )