The Consumer Protection Bill Passed

By Moderator July 31, 2019 11:13

The Lok Sabha on Tuesday passed the Consumer Protection Bill, 2019, which promises to strengthen the rights of consumers and provides a mechanism for redressal of complaints regarding defects in goods and deficiency in services.

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  • Union Food and Consumer Affairs Minister Ram Vilas Paswan stressed that the overall purpose of the legislation was to ease the process of addressing grievances of consumers.
  • The Bill, replacing the earlier Consumer Protection Act, 1986, was passed after all the amendments moved by Opposition were negated.
  • Bill contains key provisions dealing with class actions, product liability, misleading advertisements, liability for celebrity endorsements, etc.

The Consumer Protection Bill 2019 Objective

The main objective of the Consumer Protection Bill is to ease the process of addressing the grievances of consumers.

The highlight of the Bill

Rights of consumers

This includes the right to:

  • be protected against the marketing of goods and services which are hazardous to life and property;
  • be informed of the quality, quantity, potency, purity, standard and price of goods or services;
  • be assured of access to a variety of goods or services at competitive prices; and
  • seek redressal against unfair or restrictive trade practices.

Central Consumer Protection Authority

  • The central government will set up a Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers.
  • It will regulate matters related to violation of consumer rights, unfair trade practices, and misleading advertisements.
  • The CCPA will have an investigation wing, headed by a Director-General, which may conduct inquiry or investigation into such violations.

CCPA will carry out the following functions, including:

  • inquiring into violations of consumer rights, investigating and launching prosecution at the appropriate forum;
  • passing orders to recall goods or withdraw services that are hazardous, reimbursement of the price paid, and discontinuation of the unfair trade practices, as defined in the Bill;
  • issuing directions to the concerned trader/ manufacturer/ endorser/ advertiser/ publisher to either discontinue a false or misleading advertisement or modify it;
  • imposing penalties, and;
  • issuing safety notices to consumers against unsafe goods and services.

Penalties for a misleading advertisement:

  • The CCPA may impose a penalty on a manufacturer or an endorser of up to Rs 10 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.
  • CCPA can also prohibit the endorser of a misleading advertisement from endorsing that particular product or service for a period of up to one year.
    • For every subsequent offense, the period of prohibition may extend to three years. However, there are certain exceptions when an endorser will not be held liable for such a penalty.

Consumer Disputes Redressal Commission

  • Consumer Disputes Redressal Commissions (CDRCs) will be set up at the district, state, and national levels.
  • A consumer can file a complaint with CDRCs in relation to (i) unfair or restrictive trade practices; (ii) defective goods or services; (iii) overcharging or deceptive charging; and (iv) the offering of goods or services for sale which may be hazardous to life and safety.
  • Complaints against an unfair contract can be filed with only the State and National Appeals from a District CDRC will be heard by the State CDRC.  Appeals from the State CDRC will be heard by the National CDRC.
  • The final appeal will lie before the Supreme Court.

Jurisdiction of CDRCs:

  • The District CDRC will entertain complaints where the value of goods and services does not exceed Rs one crore.
  • The State CDRC will entertain complaints when the value is more than Rs one crore but does not exceed Rs 10 crore.
  • Complaints with the value of goods and services over Rs 10 crore will be entertained by the National CDRC.

Product liability

  • Product liability means the liability of a product manufacturer, service provider or seller to compensate a consumer for any harm or injury caused by a defective good or deficient service.
  • To claim compensation, a consumer has to prove any one of the conditions for defect or deficiency, as given in the Bill.

Also read: Draft Personal Data Protection Bill

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By Moderator July 31, 2019 11:13