"Consumers are the kings and hence they always need to be served the best." The Parliament of India has repealed the three-decade old Consumer Protection Act, 1986, and replaced it with the new Consumer Protection Act, 2019, w.e.f 20.07.2020. The Government has broadened the horizon of the Act and has given holistic and all- encompassing definitions of consumer, consumer rights (which also include right to consumer awareness), e-commerce, endorsement, product liability, unfair contract, misleading advertisement, inserted 'telecom' in the definition of "service", provided for establishment of Central Consumer Protection Authority with the power of search & seizure and issue directions and penalties against false or misleading advertisements. The new law provides for stringent provisions including rigorous punishment & penalties in tune with the current scenario.
WHO IS A CONSUMER?
A person is called a consumer if he "hires or avails any services" and "buys any goods" for self-use and not for commercial purpose. The new Act covers all types of transactions including online transactions through electronic means or by teleshopping or direct selling or multi-level marketing.1
WHERE TO FILE THE COMPLAINT?
A consumer can file the complaint from anywhere. Yes, it is true! Any consumer can file a complaint upto Rs. 1 crore in the District Forum where the complainant resides or works irrespective of the place where the seller or service provider is located.2 This comes as a big relief, especially for online buyer as earlier the consumer had to file the complaint in the area where the seller or service provider is located.
Any complaint where the value of the goods or services paid as consideration. exceeds Rs. 1 crore but does not exceed Rs. 10 crore will be entertained by the State Commission3 and complaint exceeding an amount of Rs. 10 Crore will entertained by the National Commission.
The consumer can file their complaint electronically4 and also serve the notice through electronic means5 and in addition to this, he/she can opt for hearing or for examination of parties through video conferencing.6
At the first hearing after the admission of the complaint if it appears to the Commission - District, State or National - that there is possibility of settlement, the court, after obtaining the written consent from the parties, can refer for settlement through mediation.7 But there will be no appeal against settlement through mediation. Earlier, there was no legal provision for this.
POWER OF REVIEW
The new Act gives power to District Commission8 , State Commission9 and National Commission10 to review its own order if there is any apparent error. Earlier, a lawyer had to file an appeal in a State Commission for reviewing any order of District Commission and in a National Commission for reviewing the order of State Commission.
PENALTY FOR NON-COMPLIANCE OF ORDER
The new Act also has a provision for stringent penalty if anyone fails to comply with the order of District Commission, State Commission and National Commission. It is noteworthy to mention that offences may attract a fine up to Rs. 1 lakh and imprisonment up to 3 years.11
ESTABLISHMENT OF CENTRAL CONSUMER PROTECTION AUTHORITY (CCPA)
The Central Govt. shall establish CCPA for regulating matters related to violation of rights of consumers, unfair trade practices and false or misleading advertisements.12 An investigation wing13 will also be set up for supporting the CCPA for conducting inquiries and investigations with the power of search and seizure14 as prescribed in Cr.P.C but vexatious search is punishable offence as laid down in S. 93 of the new Act.
In the new Act the District Collector also has the power to inquire into or investigate the complaints regarding violation of consumer rights, unfair trade practices and false or misleading advertisements on a reference made to him by the CCPA.15
The CCPA only has the power to issue directions and penalties against false or misleading advertisements to concerned trader or manufacturer or endorser or advertiser or publisher.16 So the consumer can forward their complaint relating to false or misleading advertisements either in writing or in electronic mode to the District Collector or the Commissioner of regional office or the central authority17 and then CCPA, after investigation will issue appropriate direction or may impose a penalty.
It means that consumer can seek compensation for harm caused by a product or service. In the new Act there is a separate chapter for product liability, which provides for product liability action by complainant for any harm caused by defective product manufactured by product manufacturer or serviced by product service provider or sold by a product seller. It means that no one can shift the onus on to others by simply saying that it is not manufactured or serviced or sold by me. Earlier there was no such provision and consumer had to approach civil court for compensation.
The scope of the new Act has been widened by introduction of various provisions including e-commerce within its purview. Procedural changes have been made like filing of cases electronically, to give notice with different mode and hearing through video conferencing. The new Consumer Act also prescribes the time limit of 3 months to conclude the entire case from the date of receipt of notice by the opposite party.19 But it is not practical to conclude the case within 3 months and especially when the pecuniary jurisdiction has been increased. Juxtapositionally, in the initial phase, the District Commission and State Commission will be over burdened with cases and also mass transfer will take place from National Commission to State Commission and from State Commission to District Commission which will further delay the proceedings as benches and infrastructure is limited as compared to the National Commission.
1. Section 2(7), The Consumer Protection Act, 2019
2. Section 34, The Consumer Protection Act, 2019
3. Section 47, The Consumer Protection Act, 2019
4. Section 35, The Consumer Protection Act, 2019
5. Section 65, The Consumer Protection Act, 2019
6. Section 38(6), The Consumer Protection Act, 2019
7. Section 37, The Consumer Protection Act, 2019
8. Section 40, The Consumer Protection Act, 2019
9. Section 50, The Consumer Protection Act, 2019
10. Section 60, The Consumer Protection Act, 2019
11. Section 72, The Consumer Protection Act, 2019
12. Section 10, The Consumer Protection Act, 2019
13. Section 15, The Consumer Protection Act, 2019
14. Section 22, The Consumer protection Act, 2019
15. Section 16, The Consumer protection Act, 2019
16. Section 21, The Consumer protection Act, 2019
17. Section 17, The Consumer protection Act, 2019
18. Chapter VI, The Consumer protection Act, 2019
19. Section 38(7), The Consumer protection Act, 2019
Originally published by INDIAN LEGAL IMPETUS® on JULY 2020. Vol. XIII, Issue VII
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.