Consumer Protection Act 2019

The Consumer Protection Act 2019 aims to protect the rights of consumers and provide a mechanism for redressal of complaints such as overpricing, deficiency in services, quality of products, misleading advertisements or unfair and restrictive practices of a seller or trader. 

The Act replaced and repealed the Consumer Protection Act 1986, intending to ease the overall process of consumer grievance redressal. Through the Consumer Protection Act, the government aims to empower consumers to take action against errant sellers. The government plans to safeguard consumers’ rights by setting up the Central Consumer Protection Authority (CCPA). 

Rights of consumers 

With the Act in place, a consumer has:

• The right to be protected against the marketing of goods, products or services which are hazardous to life and property
• The right to be informed about the quality, quantity, potency, purity, standard and price of goods, products or services, as the case may be, to protect the consumer against unfair trade practices
• The right to be assured, wherever possible, of access to a variety of goods, products or services at competitive prices
• The right to be heard and to be assured that consumer’s interests will receive due consideration at appropriate fora
• The right to seek redressal against unfair trade practices, restrictive trade practices or unscrupulous exploitation of consumers.
• The right to consumer awareness

Restrictive Trade Practice

Restrictive Trade Practice means a trade practice that tends to bring about manipulation of price or conditions of delivery or to affect the flow of supplies in the market relating to goods or services in such a manner as to impose unjustified costs or restrictions.

How the government has eased approaching Consumer Commissions

• Filing from place of residence/work
• E-filing
• Videoconferencing for hearing

The act also enables consumers to file complaints electronically and for hearing and/or examining parties through video-conferencing. This is to ensure procedural ease and reduce inconvenience and harassment to the consumers.

Powers of Central Consumer Protection Authority

• Provide relief to a class of consumers
• The authority is empowered to
  • Conduct investigations into violations of consumer rights and institute complaints/prosecution.
  •  Order recall of unsafe goods and services.
  •  Order discontinuance of unfair trade practices and misleading advertisements.
  •  Impose penalties on manufacturers/endorsers/publishers of misleading advertisements.

What can CCPA do?

• Impose a penalty on a manufacturer or an endorser of up to Rs10 lakh and imprisonment for up to two years for a false or misleading advertisement
• In case of a subsequent offense, the fine may extend to Rs. 50 lakh and imprisonment of up to five years

Consumer Disputes Redressal Commission

The government has also set up a three-tier enforcement mechanism at the district, state and national level called the Consumer Disputes Redressal Commission (CDRC).

With CDRCs, a consumer can file a complaint about:

• Unfair or restrictive trade practices
• Defective goods or services
• Overcharging or deceptive charging
• The offering of goods or services for sale which may be hazardous to life and safety

There is a clear-cut distinction between the district commission, state commission and the national commission.  The Bill also envisages a simplified dispute resolution process that has a provision for mediation and e-filing of cases. The consumer will be able to file cases in the nearest commission under the jurisdiction of which he or she resides.

The government had introduced the Bill timely. The earlier Act had left out many important things. The Act ensures the protection of consumers’ rights and gives teeth to the existing authorities, which investigate issues and complaints about products and services. 

Product liability 

A manufacturer or product service provider or product seller is to be responsible to compensate for injury or damage caused by defective product or deficiency in services. 

A person can raise a complaint based on

• Manufacturing defect
• Design defect
• Deviation from manufacturing specifications
• Not conforming to the express warranty
• Failing to contain adequate instructions for correct use
• Service provided-faulty, imperfect or deficient

Mediation

• An Alternate Dispute Resolution (ADR) mechanism
• These mediating cells are to be attached to consumer mechanisms
• Mediation to be held in a consumer mediation cell
• No appeal against the settlement through mediation

Inclusion of the e-commerce sector

Given that the rapid growth and emerging trend of e-commerce have changed the consumer preferences to buy online, the government has also brought in the Consumer Protection Act, 2019 and Consumer Protection (E-commerce) Rules, 2020 to protect the rights of consumers. 

Some of the duties of an e-commerce company are that it should be a company incorporated under the Companies Act, 1956 or the Companies Act, 2013, It should appoint a nodal person of contact or an alternate senior designated functionary who is resident in India, it should display its legal name of the e-commerce entity clearly, it should display the principal geographic address of its headquarters and all branches and it should have contact details like email address, fax, landline and mobile numbers of customer care as well as of grievance officer, among others.

With the pandemic changing the lives of citizens and the necessity to use e-commerce, the responsibilities of sellers to adhere to the government norms also increase. The new Act equips the machinery to meet the new emerging challenges like e-commerce, telemarketing, misleading advertisements, etc., and ensure efficiency in grievance redressal.

Conclusion

The Act strives to empower consumers and defend their rights via numerous provisions such as Consumer Protection Councils, Consumer Disputes Redressal Commissions, Mediation, Product Liability, and penalties for making or selling items containing adulterant / counterfeit goods.