Consumer Protection Act, 2019

Consumer Protection Act, 2019 notified with effect from 20 July 2020.

The main features of The Consumer Protection Act, 2019 are as follows:-
1. District forum is renamed as District Commission

  1. The Opposite Party needs to deposit 50% of the amount ordered by District Commission before filing an appeal before State Commission, earlier the ceiling was of a maximum of Rs. 25,000/-, which has been removed. 
  2. The limitation period for filing of an appeal to State Commission is increased from 30 days to 45 days while retaining the power to condone the delay. 
  3. State Commission shall have a minimum of 1 President and 4 Members.
  4. The original pecuniary jurisdiction of District Commission shall be up to Rs. 1 Crore, State Commission from 1 Cr – 10 Cr. And NCDRC to be more than Rs. 10 crores.
  5. Now complainant can also institute the complaint within the territorial jurisdiction of the Commission where the complainant resides or personally works for gain besides what was provided earlier.
  6. Section 49(2) and 59(2) of the new act gives power to the State Commission and NCDRC respectively to declare any terms of the contract, which is unfair to any consumer, to be null and void.
  7. A second appeal to NCDRC has been provided U/s 51(3) if there is a substantial question of law involved in the matter.
  8. Power of revision can still be exercised by NCDRC U/s 58(1)(b) and by State commission under 47(1)(b) of the Act.
  9. Power of review has been conferred to District Commission, State Commission and NCDRC U/s 40, 50 and 60 of the Act respectively.
  10. NCDRC can hear appeals against the order of Central Authority by virtue of Section 58 of the Act.
  11. Period of limitation in the filing of complaint remains 2 years with a provision for condonation of delay power U/s 69 of the Act.
  12. Section 70 provides for administrative control of State Commission over District Commission and that of NCDRC over State Commission. It inter alia provides for an investigation into any allegations against the President and members of a State Commission / District Commission and submitting inquiry report to the State Government concerned along with copy endorsed to the Central Government for necessary action.
  13. Section 71 confers the power of execution as provided Under Order XXI, The Code of Civil Procedure, 1908 with such limitation as provided in the section.
  14. Mediation is given statutory status by way of introduction of Section 74 in the new Act.
  15. A product liability action may be brought by a complainant against a product manufacturer or a product service provider or a product seller, as the case may be, for any harm caused to him on account of a defective product.
  16. Chapter III of the Act provides for the creation of Central Authority to regulate matters relating to the violation of rights of consumers, unfair trade practices and false or misleading advertisements which are prejudicial to the interests of public and consumers and to promote, protect and enforce the rights of consumers as a class.
  17. The Central Authority shall have an Investigation Wing headed by a Director-General for the purpose of conducting inquiry or investigation under this Act as may be directed by the Central Authority.
  18. The Act of 2019 has come into effect w.e.f. 9.8.19 and old Act of 1986 stands repealed, subject to section 1(3) of the New Act.
  19. Rules regarding the appointment, conditions of service etc. of the Members are to be notified soon.

*The list is not exhaustive and the above is just a bird’s eye view only of the new Act. For more / exact details kindly refer to the notification dated 9.8.19 notifying the Act.

Highlights – Consumer Protection Act, 2019

The Consumer Protection Act, 2019 (“New Act”) proclaims the start of another period of shopper rights in India that are in a state of harmony with new-age buyer desires. It conveys forward the rich tradition of The Consumer Protection Act, 1986 (“Act”) that was viewed as a way breaking at the hour of its order, however, which couldn’t address the difficulties of a quickly developing, refined, and the between the subordinate market for products and ventures.

Key Highlights of the New Act-

Foundation of Central Consumer Protection Authority: The New Act will set up another administrative position known as the Central Consumer Protection Authority (“Central Authority”), which will have wide powers of examination including the intensity of search and seizure. The CCPA will have an examination wing, headed by a Director-General, which may lead request or examination concerning infringement of purchaser rights or out of line exchange rehearses (much like the MRTP Commission under recent Monopolies and Restrictive Trade Practices Act, 1969 that had forced to explore monopolistic or prohibitive exchange practice).

The Central Authority has been conceded wide powers to take Suo-moto moves, review items, request repayment of the cost of merchandise/administrations, and record class-activity suits if a buyer grievance influences multiple (one) person.

Item Liability: The New Act has officially presented the idea of item obligation and brought inside its overlay not simply the item producer and item specialist organization yet the item vendor too. An ‘item dealer’ is such an individual who is engaged with putting the item on the lookout for a business reason (for example brand proprietor). An item obligation activity for pay would now be able to be officially made on grounds of the blemish of good or inadequacy of administrations that have made mischief an individual or his/her property on grounds. The extent of imperfection and lack has been extended to incorporate non-conformance to communicate guarantee or determinations, plan deformity, inability to give satisfactory guidelines or admonitions to forestall any mischief, and so on Certain special cases have been given under the New Act from item obligation activities, for example, that the item dealer won’t be subject where the item has been abused, changed, or altered.

Unjustifiable Contracts: Following global law, the New Act presents a novel arrangement that shields purchasers against uncalled for decreases by pronouncing them to be unlawful. An uncalled for contract covers contracts between maker/broker and a shopper that causes critical changes in the privileges of the buyer that the New Act expressly perceives, for example, via – forcing outlandish commitment or condition on the purchaser which puts the customer to disservice; claiming authority to one-sided end (without sensible reason) or task without assent (which is to the inconvenience of the purchaser) in the agreement; forcing a punishment for a break which is unbalanced to misfortune caused, and so on.

Unreasonable Trade Practices: The New Act presents a more extensive meaning of Unfair Trade Practices, which likewise incorporates sharing of individual data given by the shopper in certainty except if such exposure is made as per the arrangements of some other law. The New Act engages the Central Authority and Consumer Commission (for example the legal form) to arrange the culprit of such practice to end it.

Punishments for Misleading Advertisement: The New Act presents, unexpectedly, a meaning of deluding promotion. It covers bogus portrayals and certifications of an item or administration. It likewise covers data that was purposely disguised from the purchaser. On the off chance that a deceptive commercial is discovered to be biased to the interest of shoppers, at that point the Central Authority may force a punishment of up to INR 1,000,000 (Indian Rupees One Million) on a producer. Independently, the New Act has made it a criminal offence to distribute bogus or deluding ads for makers and specialist co-ops. Whenever saw as blameworthy, they could be condemned to detainment for up to 2 (two) a long time.

Superstar Endorsement: The New Act fixes obligation on endorsers thinking that there have been various occurrences in the ongoing past where customers have fallen prey to unjustifiable exchange rehearses affected by big names going about as brand diplomats. In such cases, it gets significant for the endorser to take the onus and exercise due to ingenuity to confirm the veracity of the cases made in the notice to disprove obligation claims. In the event that a deceptive commercial is discovered to be biased to the interest of purchasers, at that point the Central Authority may force a punishment of up to INR 1,000,000 (Indian Rupees One Million) on the endorser also. The Central Authority can likewise restrict the endorser of a deceptive promotion from supporting that specific item or administration for a time of up to 1 (one) year. For each resulting offense, the time of forbiddance may reach out to 3 (three) a long time.

Internet business Transactions Covered: The New Act has enlarged the meaning of ‘customer’. The definition presently incorporates any individual who purchases any products, regardless of whether through disconnected or online exchanges, electronic methods, mail order shopping, direct selling, or staggered showcasing. The previous Act didn’t explicitly incorporate online business exchanges.

Improvement of Pecuniary Jurisdiction: Like the past Act, there are three fora for customer complaint redressal: The District Commission, State Commissioner, and National Commission. Each for a has been given a monetary cut-off to engage shopper protests. These cut-off points are far higher than the cut-off points set by the past Act. The District Commission (prior alluded to as District Forum) would now be able to engage shopper grumblings where the estimation of products or administrations paid doesn’t surpass INR 10,000,000 (Indian Rupees Ten Million). The State Commission can engage questions where such worth surpasses INR 10,000,000 (Indian Rupees Ten Million) yet doesn’t surpass INR 100,000,000 (Indian Rupees One Hundred Million), and the National Commission can practice locale where such worth surpasses INR 100,000,000 (INR One Hundred Million).

E-FILING OF COMPLAINTS: The New Act gives adaptability to the buyer to document objections with the jurisdictional shopper gathering situated at the spot of home or work of the purchaser. This isn’t a choice under the past Act, which ordered the recording of the protest at the work environment or business of the contrary party. The New Act additionally contains empowering arrangements for purchasers to document grievances electronically and for hearing or potentially looking at parties through video-conferencing. This ought to lessen bother for the customers, particularly the ones who are genuinely tested because of infirmity or mature age.

Arrangement for Alternate Dispute Resolution: The New Act accommodates intervention as another question goal component, making the cycle of debate settling less complex and speedier. This will help the speedier the goal of debates and decrease tension on customer courts.

DATE OF REQUIREMENT: The New Act has been told on August 9, 2019. It will supplant the Consumer Protection Act, 1986 when implemented. The date of the implementation of the New Act 2019 has yet not been reported however is normal soon.

With the New Act turning into the tradition that must be adhered to, gone are the times of ‘Purchasers be careful’. The purchaser is currently the lord, in business as well as in law. Subsequently, it is significant for FMCG, E-retailers, and Celebrity Endorsers to be aware of the arrangements of the New Act. All organizations must try harder and revise their strategic approaches and agreements to meet the desires for the New Act so they don’t end up got on some unacceptable side of the law when the New Act is authorized.