Name: Yash Prakash Yadav, LL.B. at Campus Law Centre, Delhi University
The Consumer Protection act, 2019 was brought and introduced in the Lok Sabha on 8 July 2019 by Mr. Ram Vilas Paswan, who was at that time held the post of Minister in Consumer Affairs, Food and Public Distribution. Lok Sabha passed this act on 30 July 2019 and later passed by upper house, that is Rajya Sabha on 6 August 2019. President Ram Nath Kovind gave his consent to the same on 9 August and was notified in the Gazette of India on the same date. The Act came into effect on 20th July 2020, while some other provisions of the Act like formation of the Central Consumer Protection Authority came into effect from 24th July 2020.
People consume a variety of things in daily lives. All of us are consumers in one way or the other. When one buy things from the market he or she acts as a consumer, and expect in return value for our money, i.e., quality, quantity, right price, etc. But there may be situations every now and then where a consumer is cheated. The Consumer Protection Act, 1986, was enacted to provide an easy and fast redressal to consumer problems. It promotes and protect the interest of consumers against inappropriateness and defects of goods or services. It also secures the rights of a consumer against unethical trade methods.
The agenda of a consumer forum was to provide relief to both parties and discourage long litigation.
Then why introduce new act in 2019
The Consumer Protection Act, 1986 was a very positive move and was appreciated by all, but during the past 3 decades the market conditions changed very rapidly in India and the elements of the above-mentioned legislation started to become less effective and many loopholes were noticed. To tackle the same the legislation was amended from time to time to keep it effective in light of changes brought by globalization, digitalization, and liberalization of markets. But these efforts were not enough to tackle the new age issues of the consumers and thus the legislation was now failing to fulfill the promise in its preamble. Thus, Consumer Protection Act, 2019 was brought in the picture. Note, preamble for both the legislation is same.
The Consumer Protection Act, 2019 changed three-decade old Consumer Protection Act, 1986. This new Act brought in force new measures and gave more effectiveness to the existing laws to further protect the rights of consumer. Introduction of a central regulator, high penalties for false and misleading advertisements and guidelines for e-commerce and electronic service providers are some of many positive part of this new Act. Consumer courts, in appropriate hierarchy are given the powers to address appeals even against their own decisions, therefore providing power of judicial review to these consumer forums. The old legislation (the act of 1986) had its ambit of law to all goods and services for consideration, while free and personal services are excluded but in the act of 2019 all goods and services, also adding into it telecom and housing construction, and all types of transactions (online, teleshopping, etc.) for consideration are included, but free and personal services are not included even now. In contrast to the act of 1986, the 2019 act establishes the Central Consumer Protection Authority (CCPA), somewhat as a regulator to protect, and enforce the rights of consumers. CCPA can issue safety notices, give orders to recall goods, prevent unfair practices, and provide purchase price paid and order penalties for misleading advertisements.
Some Notable Changes
Now the definition of consumer, in the new legislation, also includes those who use online platforms to buy their goods and services. New onus has been placed on the endorsers, other than manufactures and service providers, to prevent consumers from fake and misleading advertisements and endorsements. It also prevents celebrities and influencers to provide and published fake opinions and feedbacks. One more positive point to note here is that the advertisement code in this act is applicable to all forms of communications, online and social platforms. Now the definition of “goods” has been changed to include “food” as mentioned in the Food Safety and Standards Act, 2006. This step also brings the rising number of food delivery platforms within the jurisdiction of the 2019 Act. In addition to it “telecom” has been included to the definition of “services” to bring telecom service providers within the fold of the 2019 Act. But note that, such inclusion has not been put up as “telecommunication service” as defined under the Telecom Regulatory Authority of India Act, which would have included internet, cellular and data services. An important addition is the introduction of the concept of “product liability”. By this manufacturers and sellers of products or services have been made more accountable and also responsible to compensate for any harm caused to a consumer by defective products, manufactured or sold, or for deficiency in services. One more new concept is that of “unfair contracts” aimed to protect consumers from unreasonable contracts which lean in favor of manufacturers or service providers. The definition of “unfair trade practices” has been increased and made more comprehensive to include electronic advertising in it, which is misleading, as well as acts of refusing to take back or exchange or withdraw faulty and defective products, or to withdraw or discontinue services which are found to be deficient, and to refund the value of the consideration within a decided time period or, in the absence of such stipulation, within 30 days. In act of 2019 it is now an offence in eyes of the law if any private information, given in confidence and obtained in the course of a business transaction, gets disclosed in public. All these changes are an attempt to bring more transparency in the market, through legislative powers. Act of 2019 still provide for Consumer Dispute Redressal Commissions at the District, State and National levels (Consumer Commissions), but the pecuniary limits for jurisdiction, i.e., the monetary value of complaints that can be discussed and decided, of each of these commissions have been moved up to reduce the workload of State and National Commissions by letting consumers to approach the District Commission for complaints valued up to Rupees 1 Crore. Also, now the admissibility of a complaint filed must be finalized within 21 days.
Many more changes and new additions have taken place in the Act, some changes are favored by many and some are disputed by many but overall, the 2019 Act is a remarkable step towards development of consumer laws in India, in the light of fast changing socio-economic conditions. We can see that similar steps have been brought in different spheres for example, homebuyers being considered Financial Creditors under the Bankruptcy Code and the coming into effect of RERA. But the real test for the 2019 Act is in its implementation. The Consumer Protection Act, 2019 has taken transparency to a new level for the consumers. If no loopholes are allowed to curtail this transparency then this act will lead a path towards more efficient market conditions for both, the producers, and the consumers.