Consumer Protection Act - 2019.pdf

The Consumer Protection Act, 2019 has been enacted for the purpose of providing timely and effective administration and settlement of consumer disputes and related matters.

1. Consumer Protection
Act -2019
http://bankingdigests.com/

2. INTRODUCTION
➢TheConsumerProtectionAct,2019hasbeenenactedforthepurposeof
providingtimelyandeffectiveadministrationandsettlementofconsumer
disputesandrelatedmatters.
➢Itisalegalforceavailabletocustomertoenforcetheirrightasconsumer.
➢TheConsumerProtectionActwasinitiallyenactedin1986and
implementedfromApril15,1987.
➢Amendmenton17.12.2002,andimplementedw.e.f.15
th
March2003
(WorldConsumers’RightsDay).
➢Further,itwasamendedin2019as‘TheConsumerProtection
(Amendment)Bill,2019’.2019ActwaspassedbytheIndianParliament
andreceivedtheassentofthePresidentonthe9
th
August,2019.
➢ThisnewactreplacedtheoldConsumerProtectionAct,1986.

3. DEFINITION OF CONSUMER
Consumer means any individual who-
1)Buysanygoodsforaconsiderationwhichhasbeenpaidor
promisedorpartlypaidandpartlypromised;or
2)Hiresoravailofanyservicesforaconsiderationwhichhasbeen
paidorpromisedorpartlypaidandpartlypromised,orunder
anysystemofdeferredpayment;
3)Includesanyuserofsuchgoodsotherthanthepersonwhobuys
suchgoodsorhiresofanyservicesforconsiderationpaid;or
4)Promisedorpartlypaidorpartlypromised,orunderanysystem
ofdeferredpayment,whensuchuseismadewiththeapproval
ofsuchperson.

4. WHI IS NOT A CONSUMER ?
1.Personbuyinggoodsforresale.
2.Personbuyinggoodsforanycommercial
purpose.
3.Personreceivinggoods/servicesfreeorgifts.
4.Personenjoyingpersonalserviceundera
contract(i.e.-servicebyemployees/maid
servants)etc.

5. CONSUMER DEFINITION CHANGES UNDER ACT, 2019
➢Thosewhomakepurchasesonline.Endorsementofgoodsand
services,normallydonebycelebrities,arealsocoveredwithin
theambitofthe2019Act.
➢Infact,anadditionalonushasbeenplacedonendorsers,apart
frommanufacturersandserviceproviders,topreventfalseor
misleadingadvertisements.
➢Thedefinitionof“goods”hasbeenamendedtoinclude“food”
asdefinedintheFoodSafetyandStandardsAct,2006and
includedfooddeliveryplatformswithinthefoldofthe2019Act.
➢Interestingly,“telecom”hasbeenaddedtothedefinitionof
“services”tobringtelecomserviceproviderswithinthe
purviewofthe2019Act.

6. CONSUMER DEFINITION CHANGES UNDER ACT, 2019
➢Asignificantadditiontothe2019Actistheintroductionof“product
liability”wherebymanufacturersandsellersofproductsorservices
havebeenmaderesponsibletocompensateforanyharmcausedtoa
consumerbydefectiveproductsorfordeficiencyinservices.
➢Anothernewlyintroducedconceptisthatof“unfaircontracts”
aimedtoprotectconsumersfromunilaterallyskewedand
unreasonablecontractswhichleaninfavourofmanufacturersor
serviceproviders.
➢Thedefinitionof“unfairtradepractices”hasbeenenlargedto
includeelectronicadvertisingwhichismisleading,aswellasrefusing
totakebackorwithdrawdefectivegoods,andtorefundthe
considerationwithintheperiodstipulatedwithinaperiodof30days.

7. COVERAGE UNDER THE ACT
➢Explanation: -For the purposes regarding definition of consumer;
(a)Theexpression"commercialpurpose"doesnotincludeusebya
personofgoodsboughtandusedbyhimexclusivelyforthepurpose
ofearninghislivelihood,bymeansofself-employment;
(b)Theexpressions"buysanygoods"and"hiresoravailsany
services"includesofflineoronlinetransactionsthroughelectronic
meansorbytele-shoppingordirectsellingormulti-levelmarketing;
➢Coverage:Allgoodsandservicesincludingbanking,insurance,
transport,processing,electricity,professionalsuchasphysiciansetc.
inprivate,publicandcooperativesectorsarecoveredunderthisAct.
Allbankingservicesarecoveredduetotheirbeingessentialservices.

8. RIGHTS OF CONSUMERS
Theactprovidesfollowingrightstotheconsumers;
i.Tohaveinformationaboutthequantity,quality,
purity,potency,price,andstandardofgoodsor
services;
ii.Tobeprotectedfromhazardousgoodsandservices;
iii.Tobeprotectedfromunfairorrestrictivetrade
practices;
iv.Tohaveavarietyofgoodsorservicesatcompetitive
prices;
v.Tohavetherighttoconsumerawareness.

9. CONSUMER PROTECTION COUNCIL
Topromoteandprotecttherightof
theconsumers,councilsare
established.Theirscopeisnot
regardingdirectlydealingwiththe
consumercomplaintsatinitialor
appellatescopebuttopromoteand
protecttherightsofconsumer.

10. OBJECTIVE OF THE COUNCILS
TheobjectivesoftheCouncilsunderConsumerProtectionActisto
promoteandprotecttherightsoftheconsumerssuchas:-
➢Therighttobeprotectedagainstthemarketingofgoodsandservices
whicharehazardoustolifeandproperty.
➢Therighttobeinformedaboutthequality,quantity,potency,purity,
standardandpriceofgoodsorservices,asthecasemaybesoasto
protecttheconsumeragainstunfairtradepractices;
➢Therighttobeassured,whereverpossible,accesstoavarietyofgoods
andservicesatcompetitiveprices;
➢Therighttoseekredressalagainstunfairtradepracticesorrestrictive
tradepracticesorunscrupulousexploitationofconsumers;andTheright
toconsumereducation.

11. CENTRAL CONSUMER PROTECTION COUNCIL
TheCentralGovernmenthasestablishedacouncilknown
astheCentralConsumerProtectionCouncil,calledthe
CentralCouncil.TheCentralCouncilconsistofthe
following:
a)TheMinister-In-chargeoftheConsumerAffairsinthe
CentralGovernmentshallbetheChairmanofthecouncil,
and
b)Suchmemberofotherofficialornon-officialmembers
representingsuchinterestsasmaybeprescribed.
TheCentralCouncilshallmeetasandwhennecessary
butatleastonceinayear.

12. STATE CONSUMER PROTECTION COUNCIL
TheStateGovernmenthasestablishedacouncilknownasthe
StateConsumerProtectionCouncil,calledtheStateCouncil.The
StateCouncilconsistofthefollowing:
a)TheMinister-In-chargeoftheConsumerAffairsintheState
GovernmentshallbetheChairmanofthecouncil,
b)Suchmemberofotherofficialornon-officialmembers
representingsuchinterestsasmaybeprescribedbytheState
Government,and
c)Suchmemberofotherofficialornon-officialmembersnot
exceedingtenasmaybenominatedbyCentralGovernment.
TheStateCouncilshallmeetasandwhennecessarybutatleast
twiceinayear.

13. DISTRICT CONSUMER PROTECTION COUNCIL
TheStateGovernmenthasestablishedacouncilknownasthe
DistrictConsumerProtectionCouncilineverydistrict,called
theDistrictCouncil.TheDistrictCouncilconsistofthe
following:
a)TheCollectoroftheDistrictshallbetheChairmanofthe
council,
b)Suchmemberofotherofficialornon-officialmembers
representingsuchinterestsasmaybeprescribedbytheState
Government,and
TheStateCouncilshallmeetasandwhennecessarybutat
leasttwiceinayear.

14. CENTRAL CONSUMER PROTECTION AUTHORITY ( CCPA)
Oneofthemostsignificantadditionstothe2019Actistoestablish
CentralConsumerProtectionAuthority(CCPA)withthefollowing
features;
❖TheCentralAuthorityshallconsistofaChiefCommissionerand
otherCommissionersasmaybeprescribed,tobeappointedbythe
CentralGovernment.
❖TheCentralAuthorityshallhaveanInvestigationWingheadedbya
DirectorGeneralforthepurposeofconductinginquiryor
investigationunderthisAct.
❖TheCCPAhastoregulate,protectandenforcetheinterestofthe
consumersandmattersrelatedtounfairtradepractices.

15. CENTRAL CONSUMER PROTECTION AUTHORITY (CCPA)
❖TheCCPAhasbeenprovidedwithvastpowerstoinquire,investigateand
takeactionagainstviolationsofthe2019Act.
❖AnothersignificantpowertheCCPAhasbeenshoweredwith,isthe
powertotakeactionandimposepenaltyagainstmisleadingandfalse
advertisementaswellasagainstanyendorserofsuchadvertisement.
❖ItmeanstheCCPAcannowinitiateactionagainstthecelebritieswho
haveendorsedsuchmisleadingandfalseadvertisementprovidedsuch
celebritiesfailedtocarryoutanyduediligencebeforeparticipatinginsuch
advertisements.
❖TheCCPAmayimposeapenaltyofuptoRs.10Lakhsforfirstviolation
anduptoRs.50Lakhsoneverysubsequentviolationonamanufactureror
anendorser,forafalseormisleadingadvertisement.
❖Inadditiontothis,suchmanufacturerorendorsermaybesentencedto
imprisonmentforuptotwoyears.

16. WHO CAN FILE A COMPLAINT ?
❖Aconsumer(individuallyorjointly),any
voluntaryconsumerorganisation,Central
orStateGovernments.
❖Limitationperiodis2yearsfromthe
dateofcauseofactioni.e.purchaseof
goods/hiringofservices.

17. PROCEDURE
❖Asimplewrittencomplaintinduplicatewithfull
nameandaddressofoppositepartynarrating
factsofthecomplaintalongwithcopiesofthe
supportingdocumentsanddetailsofrelief
sought.
❖NoCourtFeeischarged.
❖EngagingofLawyerisnotnecessary,consumeror
anyonecanrepresenthiscase.

18. CONSUMER CAN FILL HIS COMPLAIN IN THE
FOLLOWING CONSUMER COMMISSION
1)DistrictCommission:ADistrictCommissionestablishedbytheState
GovernmentineachdistrictoftheStatebynotification.TheDistrict
Commissionhavejurisdictiontoentertaincomplaintswherethevalueof
thegoodsorservicespaidasconsiderationdoesnotexceedRs.1Crore.
2)StateCommission:EachStateCommissionshallconsistofaPresident
andnotlessthanfourmembers.complaintswherethevalueofthegoods
orservicespaidasconsideration,exceedsrupeesonecrore,butdoesnot
exceedrupeestencrore.
3)NationalCommission:TheNationalCommissionshallconsistofa
Presidentandnotlessthanfourmembers.complaintswherethevalueof
thegoodsorservicespaidasconsideration,exceedsrupeesonecrore,but
doesnotexceedrupeestencrore.

19. PECUNIARY JURISDICTION
.
Commission Claim Amount Office Structure
District
Commission
UptoRs.1Crore HeadedbyPresident&2other
members.
State
Commission
MorethanRs.1Crore
uptoRs.10Crore
HeadedbyPresident&4other
members.
National
Commission
AboveRs.10Crore HeadedbyPresident&4other
members.Maximum age70
yearsforPresidentand67
yearsforanyothermember.

20. CONSUMER MEDIATION CELL
Anotherprovisionintroducedbythe2019Acttoensurespeedyresolutionof
disputesistoprovideforreferringthedisputestomediation.TheConsumer
Commissionshallreferthemattertomediationonwrittenconsentofboththe
parties.
TheStateGovernmentshallestablishaconsumermediationcelltobeattachedto
eachoftheDistrict/StateCommissionsofthatState.TheCentralGovernment
shallestablishaconsumermediationcelltobeattachedtotheNational
Commission.Everyconsumermediationcellshallmaintain:
(a) a list of empanelled mediators;
(b) a list of cases handled by the cell;
(c) record of proceeding; and
(d) any other information as may be specified by regulations.
TheCommissionshallwithinsevendaysofthereceiptofthesettlement
reportpasssuitableorderrecordingsuchsettlementofconsumerdispute
anddisposeofthematteraccordingly.

21. RELIEF BY DISTRICT COMMISSION
If,aftertheproceedingconductedtheDistrictCommission
issatisfiedaboutthecomplaint,itshallissueanorderto
theoppositepartydirectinghim:
➢Toremovethedefectpointedoutfromthegoods;
➢Toremovalofdeficienciesinservices;
➢Toreplacementbynewgoodsfreefromdefects;
➢Torefundofprice/chargesetc.;
➢Topaysuchamountasmaybeawardedas
compensationtotheconsumerforanylossorinjury
sufferedbytheconsumer,duetothenegligenceofthe
oppositeparty.

22. SUMMARY OF OFFENCE AND PUNISHMENT
Particulars Offence Type Punishment
Amount
Imprisonment
Period
Order made by the District /
State / National Commission
Found guilty Min. Rs. 25000/-
Max. Rs. 1 Lakh
Min. 1 month
Max. 3 years
Direction of Central AuthorityFails to comply with any
direction
Max. Rs. 20 LakhMax. 6 months
False or misleading
advertisement
First time offence Max. Rs. 10 LakhMax. 2 years
every subsequent offenceMax. Rs. 50 LakhMax. 5 years
Manufacturing for sale or
storing, selling or distributing
or importing products
containing adulterant or
importing spurious goods.
(1
st
conviction, suspend
licence for a period up to two
years, and in case of second
or subsequent conviction,
cancel the licence)
Does not result any injuryMax. Rs. 1 LakhMax. 6 months
Causing injury not
amounting to grievous hurt
Max. Rs. 3 LakhMax. 1 years
Causing injury resulting in
grievous hurt
Max. Rs. 5 LakhMax. 7 years
non-bailable
Results in the death of a
consumer
Min. Rs. 10 LakhMin. 7 years
Max. Whole life
non-bailable

23. APPEAL AGAIST THE ORDER
➢AnypersonmayappealtoStateCommissionagainsttheawardof
DistrictCommissionwithin45daysfromthedateoforderafter
Depositamountis50%oftheamount.
➢AnypersonmayappealtoNationalCommissionagainsttheawardof
StateCommissionwithin30daysfromthedateoforderafterDeposit
amountis50%oftheamount.
➢AnypersonmayappealtoSupremeCourtagainstNational
Commissionwithin30daysfromthedateoforderafterDeposit
amountis50%oftheamount.
➢ApersonaggrievedbyanyorderpassedbytheCentralAuthority
mayfileanappealtotheNationalCommissionwithinaperiodof
thirtydaysfromthedateofreceiptofsuchorder.

24. TIME LIMIT FOR ACTION
ACTION TAKEN ON COMPLAINT TIME LIMIT
Admissionofcomplaintfromthedateofreceiptofthecomplaint. 21 days
Disposalwithoutanalysisortestingofcommodities. 3 months
Disposalanalysisortestingofcommodities. 5 months
AppealagainsttheordermadebytheDistrictCommissiontothe
StateCommission.
45 days
AppealagainsttheordermadebytheStateCommissiontothe
NationalCommission.
30 days
AppealagainsttheordermadebytheNationalCommissiontothe
SupremeCourt.
30 days
AppealagainsttheordermadebytheCentralAuthoritytotheNational
Commission.
30 days
DecisionshouldbetakenonAppealsforadmissionorrejection. 90 days