CONSUMER PROTECTION ACT

The Consumer Protection Act, 2019

The Consumer Protection Act, 2019 replaced the old Consumer Protection Act, 1986. The new bill was passed by the president on Aug 06, 2019. In our earlier blogs we have discussed how a bill becomes a Law. The new Consumer Protection Act, 2019 came into force on 20th July 2020 and it will empower consumers and help them in protecting their rights through its various notified rules and provisions.

what is the purpose of Consumer Protection Act, 2019 

Consumer Protection Act, 2019 is a law to protect the interests of the consumers. This act was inevitable to resolve a large number of pending consumer complaints in consumer courts across the country. It has ways and means to solve the consumer grievances speedily.

who is a consumer?

As per the act; a person is called a consumer who avails the services and buys any good for self-use. Worth to mention that if a person buys any good and avail any service for resale or commercial purpose, is not considered a consumer. This definition covers all types of transactions i.e. online and offline.

Key features of the Consumer Protection Act, 2019

1. Establishment of the Central Consumer Protection Authority (CCPA):

• The CCPA will regulate cases related to unfair trade practices, misleading advertisements, and violation of consumer rights.
• The CCPA will have the right to impose a penalty on the violators and passing orders to recall goods or withdraw services, discontinuation of the unfair trade practices and reimbursement of the price paid by the consumers.
• The Central Consumer Protection Authority will have an investigation wing to enquire and investigate such violations.
• The CCPA will be headed by the Director-General.

2. Rights of consumers: 

The act provides 6 rights to the consumers;

i. To have information about the quantity, quality, purity, potency, price, and standard of goods or services.

ii. To be protected from hazardous goods and services.

iii. To be protected from unfair or restrictive trade practices.

iv. To have a variety of goods or services at competitive prices

3. Prohibition and penalty for a misleading advertisement: 

The Central Consumer Protection Authority (CCPA) will have the power to impose fines on the endorser or manufacturer up to 2-year imprisonment for misleading or false advertisement.

• Worth to mention that repeated offense, may attract a fine of Rs 50 lakh and imprisonment of up to 5 years.

4. Consumer Disputes Redressal Commission: 

The act has the provision of the establishment of the Consumer Disputes Redressal Commissions (CDRCs) at the national, state and district levels.

The CDRCs will entertain complaints related to;

i. Overcharging or deceptive charging

ii. Unfair or restrictive trade practices

iii. Sale of hazardous goods and services which may be hazardous to life.

iv. Sale of defective goods or services

5. Jurisdiction under the Consumer Protection Act, 2019

The act has defined the criteria of Consumer Disputes Redressal Commission (CDRCs).

• The National CDRC will hear complaints worth more than Rs. 10 crores.
• The State CDRC will hear complaints when the value is more than Rs 1 crore but less than Rs 10 crore.
• While the District CDRC will entertain complaints when the value of goods or service is up to Rs 1 crore.

6. Alternate Dispute Resolution Mechanism of Mediation:

• A complaint will be referred by a Consumer Commission for mediation, wherever scope for early settlement exists and parties agree for it.
• The mediation will be held in the Mediation Cells which will be established under the aegis of the Consumer Commissions.
• There will be no appeal against settlement through mediation.

7.Simplification of the Consumer Dispute Adjudication Process:

• Empowering the State and District Commissions to review their own orders.
• Enabling a consumer to file complaints electronically and in consumer commissions that have jurisdiction over the place of his residence.
• Video-conferencing for hearing and deemed admissibility of complaints if the question of admissibility is not decided within the specified period of 21 days.

8. Punishment for Manufacture or Sale of Adulterated/Spurious Goods:

• In case of the first conviction, a competent court may suspend any licence issued to the person for a period of up to two years and in case of second or subsequent conviction, may cancel the licence permanently.

9.Other Rules and Regulations:

• As per the Consumer Disputes Redressal Commission Rules, there will be no fee for filing cases up to Rs. 5 lakh.
• The credit of the amount due to unidentifiable consumers will go to the Consumer Welfare Fund (CWF).
• State Commissions will furnish information to the Central Government on a quarterly basis on vacancies, disposal, the pendency of cases and other matters.
• Apart from these general rules, there are Central Consumer Protection Council Rules, provided for the constitution of the Central Consumer Protection Council (CCPC).
  
• It will be an advisory body on consumer issues, headed by the Union Minister of Consumer Affairs, Food and Public Distribution with the Minister of State as Vice Chairperson and 34 other members from different fields.
• It will have a three-year tenure and will have Minister-in-charge of consumer affairs from two States from each region- North, South, East, West, and North-East Region.

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