The Central Government has issued a notification designating the 20th day of July 2020 as the date of entry into force of the many provisions of the Consumer Protection Act, 2019 . With effect from the above date, the following provisions will come into force for the aforesaid date: –
a. Section 2 [Except clauses (4), (13), (14), (16), (40)] [Definitions]
b. Sections 3 to 9 (both inclusive); [Consumer Protection Councils]
c. Sections 28 to 73 (both inclusive); [Except sub-clause (iv) of clause (a) of sub-section (1) of section 58.] [Consumer Disputes Redressal Commission]
d. Sections 74 to 81 (both inclusive); [Mediation]
e. Sections 82 to 87 (both inclusive); [Product Liability]
f. Sections 90 and 91; [Except sections 88, 89, 92 & 93] [Offences and Penalties]
g. Sections 95, 98, 100, -Section101 [Except clauses (f) to (m) and clauses (zg), (zh) and (zi) of sub –section 2] [Miscellaneous]
h. Sections 102, 103, 105, 106, 107 [Except sections 94, 96, 97, 99, 104] [Miscellaneous]
Parliament passed the Consumer Protection Bill 2019 last year, which aims to amend completely the Consumer Protection Act 1986 . The Act seeks to ensure the protection of consumer interests and, for that reason, to create authorities to manage and resolve consumer disputes in a timely and efficient manner. On 9 August 2019, the Bill received the President’s assent.
The scope of the Act has been broadened by the inclusion under its purview of various provisions like e-commerce. The Act seeks to protect and strengthen consumers ‘ rights by creating authorities, enforcing strict liability and penalties on drug producers, electronic service providers, misleading marketers, and by providing direct mediation to settle consumer disputes.
There are administrative shifts in numbers of members, honorariums, and personnel in the Customer Courts. There are administrative improvements like giving notice of specific mode and the improvements are based on legal issues like giving powers of review.
Enhanced Pecuniary Jurisdiction: –
The limits of pecuniary jurisdiction has been expanded in the following manner : –
• District Forum: – Rs. One Crore from Rs. Twenty Lakhs
• State Commission: – Rs. Ten Crores from Rs. One Crore
• National Commission: – Above Rs. Ten Crores from Rs. One Crores
Liability of celebrity endorse: –
The Act tackles endorser liability. ‘Endorsement’ means, pursuant to Clause 2(18),:- I any letter, verbal declaration, demonstration; or (ii)representation of an individual’s name, signature, likeness or other recognizable personal characteristics; or (iii)representation of any institution or organization’s name or seal, which makes the user believe that it responds to the opinion, nding or experience of the person making such a declaration; Under Clause 21, the endorser may be charged with penalty for false and misleading advertising to rupees of ten lakhs by the CCPA. The endorser would not be responsible, however, if he has exercised due diligence to check the veracity of the statements made in the advertising relating to the product or service which he endorses.
Offences: – The Act makes consumer rights violations criminal offences and Chapter VII tackles them. As mentioned above, misleading advertising is punishable. The Act also addresses the threat of adulteration by making punishable offences for manufacturing , selling, storing products mixed with adulterants. Cognizance of offence may only be taken by a judge on a CCPA-led case. The Act also includes extended denials under Clauses 2(47) and 2(46), respectively, for “unfair trade practices” and “unfair contracts.” The Central Government is empowered to control direct sales, multi-level marketing, e-commerce, tele-shopping and so on.
Lok Sabha Passes Consumer Protection Bill
The Lok Sabha passed the Consumer Protection Bill 2019 on July 30th, 2019, which aims to provide enhanced protection for consumers’ interests and to settle their grievances on time.
The Bill, soon to be debated in the Rajya Sabha, provides for the creation of an executive agency called the Central Consumer Protection Authority (CCPA) with a mandate to investigate consumer rights abuses, recall hazardous products and services and discontinue unfair trade practices and misleading ads. The CCPA also has the authority to enforce fines on hazardous products producers and endorsers and publishers of misleading advertising.
It aims to give repeatedly a prison sentence of up to five years to manufacturers and service providers who make false or misleading ads and a fine of up to half a lakh. However, an additional aspect of the proposed Legislation is the amount of penalties it aims to give out to celebrities who promote goods or star in ads with false statements.
According to the Bill, an endorser may have to pay a fine of up to a maximum of Rs.10 lakhs and may also be barred for one year from endorsing any drug. Any subsequent violation of the bar will last up to three years.
However, the current law, which would amend the Consumer Protection Act, 1986, expanded the reach of product liability beyond manufacturing and design defects to involve deviations from production requirements, failing to provide sufficient directions for proper usage and for the delivery of faulty, incomplete and inadequate services.
This Article is Written by Ayush Garg, 3rd Year Student of Gujarat National Law University.