Consumer Protection Bill

OVERVIEW

Enacted in 1986, the Consumer Protection Act protects the interests of consumers in India against deficiencies and defects in goods or services. It makes provision for the establishment of consumer councils and other authorities for the easier and quicker settlement of consumers’ disputes and related matters. However, this Act needed changes which gave birth to Consumer Protection Bill, 2018.

On December 20, 2018, The Consumer Protection Bill, 2018 with some significant amendments was passed in the Lok Sabha. However, the Bill lapsed in the Rajya Sabha awaiting passage when the Parliament was adjourned sine die on Wednesday, 13th February, 2019. Since this Bill had been introduced in Lok Sabha which had completed its term, the Bill in Rajya Sabha lapsed upon dissolution of Lok Sabha as per parliamentary procedure.

OBJECTIVES

  • The Bill seeks to set up a central consumer protection authority (CCPA) to “promote, protect and enforce the rights of the consumers.” The CCPA can act on complaints of unfair trade practices, issue safety guidelines, order product recall or discontinuation of services, refer complaints to other regulators, and has punitive powers such as imposing penalties.”
  • The Bill also seeks to provide Consumer Disputes Redressal Commissions at national, State and district-levels to look into consumer complaints. Consumer Protection Councils will also be set up at the district, State, and national level, as advisory bodies. Consumer mediation cells will be set-up on the same lines.

SALIENT FEATURES

Few Important features of the Consumer Protection Bill, 2018 that makes it superior over Consumer Protection Act, 1986

  • Ambit of law- All goods and services, including telecom and housing construction, and all modes of transactions (online, teleshopping, etc.) for consideration. Free and personal services are excluded.
  • Unfair trade practices (Defined as deceptive practices to promote the sale, use or supply of a good or service.)- The new Bill adds three types of practices to the list, namely: (i) failure to issue a bill or receipt; (ii) refusal to accept a good returned within 30 days; and (iii) disclosure of personal information given in confidence, unless required by law or in public interest. Contests/ lotteries may be notified as not falling under the ambit of unfair trade practices.
  • Product liability- Claim for product liability can be made against manufacturer, service provider, and seller. Compensation can be obtained by proving one of the several specified conditions in the Bill.
  • Unfair contracts- Defined as contracts that cause significant change in consumer rights. Lists six contract terms which may be held as unfair.
  • Central Protection Councils (CPCs)- The new Bill makes CPCs advisory bodies for promotion and protection of consumer rights. Establishes CPCs at the district, State and national level.
  • Regulator- Establishes the Central Consumer Protection Authority (CCPA) to promote, protect, and enforce the rights of consumers as a class.
  • Pecuniary jurisdiction of Commissions- District: Up to Rs one crore; State: Between Rs one crore and up to Rs 10 crore; National: above Rs 10 crore.
  • Penalties- If a person does not comply with orders of the Commissions, he may face imprisonment up to three years, or a fine not less than Rs 25,000 extendable to Rs one lakh, or both.

 IMPORTANCE OF CONSUMER PROTECTION BILL 2018

So what changes will the Bill bring in the lives of an average consumer?

The Bill has introduced ‘e-commerce’ which will broaden the scope of the Act. So if you  are using any online platform for shopping or booking hotels and tickets, you will be treated as a consumer.

The Bill has also introduced ‘product liability.’ It means that the product manufacturer shall be liable in a product liability action if the product contains a manufacturing defect or design defect. The manufacturer can be held liable even if he proves that he was not negligent or fraudulent in making the express warranty of a product.

For speedy disposal of consumer grievances, the Bill seeks to establish a Central Consumer Protection Authority.  A person aggrieved by any order passed by the new Central Consumer Protection Authority can file an appeal to the National Commission. 

The Bill also provides the option of alternate remedy through mediation. Consumer disputes can be solved through mediation which will reduce the burden on the consumer disputes redressal authorities.

The Bill also contains a provision which imposes penalty on the manufacturer or service provider who causes a false or misleading advertisement.

The term unfair trade practices has been widened in the Bill to include practices such as non-issuance of a receipt for goods sold or services rendered among others.

STRATEGY

To fight consumer cheating, we need to support consumer law in the next Lok Sabha. The Bill needs to be passed as it will encourage consumers to approach the consumer courts  with their grievances. The Bill will cover some gaps like no provision for mediation and out of court settlement, inordinate delay, lengthy process of appeal, several adjournments due to unavailability of quorams etc. Consumer VOICE therefore has started an online petition urging all consumers and leaders of the National Political parties to sign and help pass the much needed CONSUMER PROTECTION BILL, 2018 in the new Lok Sabha after election. Sign our petition here

CASE LAWS

Here are some case laws where consumer approached the consumer court with his complaint and the order was passed in favour of the consumers

1) Ambrish Kumar Shukla & 21 ors. Vs. Ferrous Infrastructure Pvt. Ltd.
2) Moulivakkam Trust Heights Flats Affected Buyers Association & Other
3) National Insurance Co.Ltd vs Hindustan Safety Glass Works Ltd
4) Lourdes Society Snehanjali Girls Hostel and ANR. Vs. M/s. H & R Johnson (India) Ltd. & Others

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