he Consumer Protection Act, 1986, was enacted to protect the interest of consumers through quick and inexpensive grievance redressal. Minor amendments were being made to the law from time to time to cope with liberalisation and globalisation; in 2002, a major set of amendments was made to this law. But they proved to be inadequate to protect consumers or to punish unfair, corrupt and exploitative traders adequately.
The Internet has caused massive expansion of e-commerce, e-banking and digitalisation. It has brought new opportunities and challenges. The quickly changing circumstances warranted a totally new consumer law. The Consumer Protection Act, 2019, seems to have the potential to fit into the new age.
The definition of Consumer in the new Act has been broadened to include online purchaser of goods and hirer of services. e-Commerce and electronic service-providers have been defined specifically. The consumer can now file a consumer case from anywhere through e-mail also. Parties or witnesses can give evidence before Consumer Commissions through video conferencing, with the latter’s permission.
The new law also specifically defines consumer rights. These are: to be protected against hazardous goods or services; to be informed about quantity, quality, potency, purity and price of goods or services; to be informed of alternatives of goods or services and their competitive prices; to be heard by appropriate fora; to gain redressal against unfair or restrictive trade or unscrupulous exploitation; and to gain awareness.
The territorial jurisdiction of the Consumer Commissions has been expanded for the benefit and convenience of the consumers. Now a consumer can file petition with the commission under whose jurisdiction s/he resides or personally works for gain
The territorial jurisdiction of the Consumer Commissions has been expanded for the benefit and convenience of the consumers. Now a consumer can file petition with the commission under whose jurisdiction s/he resides or personally works for gain. The pecuniary jurisdictions of the district and state commissions have also been enhanced from Rs 20 lakh to Rs 1 crore, and from Rs 1 crore to Rs 10 crore respectively.
Often individual consumers have to fight against rich, powerful and influential businessmen, companies or corporations, making the challenge one-sided and in favour of traders. Such a situation discourages consumers from continuing the legal fight to a logical end. Also in consumer courts, an individual or group of consumers could not represent the entire class of consumers who suffered violation of their consumer rights as a result of unfair trade practice of a trader.
The old law failed to address these defects, but the new Act may have addressed these issues by forming a widely powerful statutory body called Central Consumer Protection Authority (CCPA) or Central Authority (CA). Its functions include protecting rights of consumers as a class and punishing those involved in unfair trade practice and false or misleading advertisements. The CA has an investigative wing that enjoys the power to search and seize in accordance with Criminal Procedure Code. The CA can direct the District Collector to inquire and investigate allegations of such violations. If the allegations are found correct, the CA will file complaints before the district, state or national commission, and fight the case on behalf victimised consumers. The CA can suo motu take up complaints filed by consumer/s.
The CA has preventive and punitive powers as well. It can recall goods and services that are unsafe, dangerous and hazardous for consumers, after due investigation and giving proper hearing to erring parties. The CA can also direct discontinuance of any advertisement found to be false or misleading. It can even impose fines on the manufacturer or endorser up to Rs 10 lakh, and for subsequent offence up to Rs 50 lakh. Defiance of the orders of the CA attracts punishment or imprisonment up to six months and/or fine up to Rs 20 lakh.
The CA also has to spread awareness among consumers on their rights, undertake research on these rights and make recommendations to the government seeking adoption of best international practices on consumer rights; it must encourage NGOs to co-operate with consumer protection agencies, issue notices to alert consumers against hazardous goods or services, issue guidelines to prevent unfair trade practices, and advise central and state governments on consumer welfare measures.
The new Act has empowered Consumer Commissions to award stringent punishments to culprits. For first offence of misleading advertisement, the offender can receive imprisonment of up to 2 years and fine up to Rs 10 lakh; for subsequent offence it can go to a maximum 5 years’ imprisonment and fine of Rs 50 lakh.
All forms of adulteration attract stringent punishment. Adulteration that causes no injury to consumer shall be punishable with imprisonment for a maximum of 6 months and fine up to Rs 1 lakh. Adulteration that causes simple injury is punishable with imprisonment up to 1 year and fine up to Rs 3 lakh. For causing grievous injury, the adulterer shall be awarded imprisonment up to 7 years and fine up to Rs 5 lakh. In case of death, punishment will be from 7 years to life in prison and fine up to Rs 10 lakh.
The new law provides for mediation on consumer disputes for quicker disposal of cases. If parties agree to settle disputes through mediation, the mediator will send settlement report to the commission concerned, and the latter will pass an order accordingly within the next seven days. If not settled, the concerned commission will settle the dispute through normal process.
The issue of unfair contract, previously confined to civil courts, has been brought under the purview of consumer commissions. The concept of “product liability” of the new Act will ensure greater empowerment of consumers, as they can now claim proper compensation from the manufacturer, seller or service-provider for defective goods, deficiency in service or loss or harm caused to them.
The new consumer law is undoubtedly far more exhaustive and effective than the old one; but as they say the taste of the pudding lies in its eating.
The writer is a senior advocate based in Bolangir. e-Mail: email@example.com.