In India, a set of laws known as the Consumer Protection Act (CPA) was passed in order to safeguard consumers’ rights in the marketplace and safeguard them from unfair business practises. Since it was first introduced in 1986, the act has undergone a number of revisions and currentlyits known as Consumer Protection Act 2019.
According to the CPA, a consumer is someone who purchases goods or services for their own use rather than for resale or other business purposes. The act applies to a broad range of consumer products and services, including food, medicine, transportation, and housing.
Need of Consumer Protection Act
To safeguard consumer interests and ensure fair trade practises, India’s Consumer Protection Act is crucial. Here are a few explanations for why India requires a robust Consumer Protection Act:
- High prices of goods and services.
- False representation of quality, standard of service.
- Monopoly by public sector.
- Short supply of goods and services.
- Uncreative discounts.
- Represents that goods have certain uses or benefits which they do not have.
- Represents that the seller has approval or affiliation which he does not have.
- Incorrect weight or quantity.
- Legal limitations.
- Lack of awareness.
- Advertisements leading to confusion.
- Incomplete information.
- Adulterated goods.
- Lack of competition.
- Consumers are not well organised.
- Rebuilt and second hand goods as new.
- Misleading representation of goods or services.
- Warranty or guarantee not based on proper test.
- Misleads the public regarding the price.
In overall, the Consumer Protection Act is essential for safeguarding consumers and making sure that companies behave morally and responsibly. Building consumer trust, which is essential for the expansion and improvement of any economy, is encouraged by it.
Objectives of the Consumer Protection Act
The Consumer Protection Act (CPA) in India has the following objectives:
- Protection of Consumer Rights: The CPA aims to protect the rights of consumers against unfair trade practices, misleading advertisements, and defective goods and services. The Act provides for the establishment of consumer courts at the district, state, and national levels to provide speedy and effective redressal of consumer complaints.
- Redressal of Consumer Grievances: The CPA provides for the establishment of consumer courts, which are empowered to hear and dispose of consumer complaints. These courts have the power to award compensation, issue injunctions, and order the recall of defective goods. The objective of the CPA is to ensure that consumers have access to a quick and efficient redressal mechanism for their grievances.
- Promotion of Consumer Welfare: The CPA seeks to promote the welfare of consumers by ensuring the availability of goods and services at reasonable prices, preventing unfair trade practices, and promoting competition. The Act also provides for the establishment of consumer councils at the district, state, and national levels to promote consumer awareness and education.
- Establishment of Consumer Protection Councils: The CPA provides for the establishment of consumer councils at the district, state, and national levels to promote consumer awareness and education. These councils are responsible for creating awareness about consumer rights, conducting surveys, and providing information to consumers.
- Establishment of Consumer Dispute Redressal Forums: The CPA provides for the establishment of consumer dispute redressal forums at the district, state, and national levels. These forums are empowered to hear and dispose of consumer complaints and are intended to provide speedy and effective redressal of consumer grievances.
- To provide for simple, speedy and inexpensive redressal of consumer disputes: The Act provides for the establishment of consumer courts at the national, state, and district levels to provide consumers with a quick and inexpensive way of resolving disputes with traders and manufacturers.
- To promote fair trade practices: The CPA, 1986 seeks to promote fair trade practices by prohibiting unfair trade practices such as false and misleading advertisements, charging excessive prices, and offering goods and services that are hazardous to the health and safety of consumers.
- To ensure consumer education: The Act recognizes the need for consumer education and provides for the establishment of a central consumer protection council to promote consumer education and awareness.
- Enacted to provide for the better protection of the interest of consumer.
- Empowerment of consumers by making them aware about their rights and responsibilities.
- Provision of effective, inexpensive and speedy redressal system to Consumers.
- Provision for three tier system-District Forum, State Commissions and National Commission.
- Consumer Forum is headed by persons with judicial background (normally retired Judges).
- Enabling National Test House to become more self sustaining.
- Strengthening of National Test House Laboratories and installation of MIS.
- Efficient Regulation of Commodity Futures Markets.
- Strengthening of Forward Markets & Forward Markets Commission.
- Formulation of Standards & Strengthen Conformity Assessment of Products and Services.
- A consumer may conduct his case on his own.
- Monitoring of prices of Essential Commodities.
- Implementation and regulation of Essential Commodities Act.
- To promote and protect the interests of consumers through various Schemes.
- Harmonious, development of standardization and quality control in national and international arena.
- Certification schemes for products and systems.
- Growth and development of Indian industry, commerce and exports.
- Technicalities of procedures stated in CPC are dispensed with (summary procedures prescribed).
- Proceedings are conducted as per Rules of Natural Justice.
- Amended in 1991, 1993 & 2002.
- Chapters I, II, IV came into force on 15 April, 1987 and Chapter III came into force on 1 July, 1987.
The Consumer Protection Act’s goals are to protect consumers from unfair business practises, provide them with access to goods and services of satisfactory quality, and give them access to channels for complaint resolution. The act also encourages consumer education and creates organisations to support India’s consumer protection.
Reasons for the enactment of the Consumer Protection Act, 2019
The Consumer Protection Act, 2019 was enacted by the Government of India to replace the old Consumer Protection Act, 1986. The new act aims to provide better protection to consumers against unfair trade practices, misleading advertisements, and deficient goods and services.
The Consumer Protection Act of 2019 was enacted for a number of reasons, including:
- To modernize the consumer protection framework: The old Consumer Protection Act, 1986 was outdated and did not reflect the changes in the market and technological advancements. The new act seeks to modernize the consumer protection framework and make it more relevant to the current times.
- To strengthen consumer rights: The new act recognizes and strengthens consumer rights such as the right to be protected against unfair trade practices, the right to seek redressal for grievances, the right to be informed about the quality, quantity, potency, purity, standard, and price of goods and services, and the right to be heard and assured of timely and effective resolution of grievances.
- To establish a comprehensive and efficient system for consumer protection: The new act establishes a Central Consumer Protection Authority (CCPA) to protect, promote, and enforce consumer rights. It also provides for the establishment of Consumer Dispute Redressal Commissions at the national, state, and district levels to provide speedy and effective resolution of consumer complaints.
- To address emerging issues in consumer protection: The new act addresses emerging issues such as e-commerce, direct selling, and product liability. It provides for the regulation of e-commerce transactions and sets out the liabilities of product manufacturers and service providers.
From the above stated reasons, it is understood that the Consumerer Protection Act, 2019 seeks to provide a robust and efficient system for consumer protection in India, with a focus on ensuring that consumers are empowered and their rights are protected.
Differences between Consumer Protection Act, 1986 and Consumer Protection Act, 2019
|The Consumer Protection Act, 1986
|The Consumer Protection Act, 2019
|District forum (upto 20 lacs), State commission (from 20 lacs to 1 crore), National commission (from 1 crore and above)
|District forum (upto 1 crore), State commission (from 1 crore to 10 crore), National commission (from 10 crore and above)
|No such provision
|Central Consumer protection authority to be formed
|No such provision
|Court can refer for settlement through mediation (Section 80)
|Earlier MRP was a criteria to decide pecuniary jurisdiction
|Now discounted price/ actual purchase price is criteria
|Earlier no specific mention
|Now all provision applicable to direct seller has been extended to e-commerce
|Where seller has office
|Where complainant resides or works
|Earlier DCF did not have the power to review
|Now DCF has power to review
|District consumer forum, State consumer forum, National Consumer Dispute Redressal Commission
|District commission, State commission, National Consumer Dispute Redressal Commission
|COMPOSITION OF STATE COMMISSION
|President and 2 other members
|President and 4 other members
|Earlier 30 days period for appeal against the order of District forum (Section 15)Earlier 50% or 25,000 whichever is less is to be deposited
|Now it is 45 days (Section 41)Now 50% of award amount
|UNFAIR TERMS AND CONDITIONS
|No such provision
|Section 49(2) and 59(2) of the new act gives power to the State Commission and NCDRC respectively to declare any terms of contract, which is unfair to any consumer, to be null and void
Write four objectives of the Consumer Protection Act, 2019 ?
(a) This Act provides for the establishment of an executive agency to be known as the Central Consumer Protection Authority (CCPA).
(b) To promote, protect, and enforce consumer rights.
(c) To initiate class actions, including enforcing product recall, refunds, and returns.
(d) As an additional dispute resolution option, “Mediation” is also made available.
Why there is need of the Consumer Protection Act ?
1.High prices of goods and services.
2.False representation of quality, standard of service.
3.Monopoly by public sector.
4.Short supply of goods and services.
- Consumer Protection (Law & Practice) by V. K. Agarwal
- Consumer Protection Act: A Commentary by G. B. Reddy
- Commentary on the Consumer Protection Act by J. N. Barowalia