Consumer Protection Laws in India - What You Need to Know

Introduction

The growth of businesses and the economy as a whole depends heavily on consumers. Consumer interest protection and product and service quality control are the main focuses of consumer protection legislation, which aims to empower consumers to make informed decisions. Keeping in mind the rapid changes in industry and commerce around the world, The (Indian) Consumer Protection Act, 1986 was updated with a new and more broader law which came into action in 2020 and new rules and regulations.

Need for the Consumer Protection Act, 2019

The Consumer Protection Act 2019 was enacted by the Indian legislature to address issues connected to consumer rights violations, unfair business practices, deceptive advertising, and all other situations that are detrimental to the rights of consumers, the Act aims to better protect the rights and interest of consumers by creating Consumer Protection Councils to resolve disputes should they occur and to give customers adequate compensation in the event that their rights have been violated. Also, alternative dispute resolution procedures, offer quick and efficient handling of customer complaints. In order to inform consumers about their rights and obligations and to help them resolve their complaints, the Act also supports consumer education.

The objective of the Consumer Protection Act, 2019

Protecting consumer interests and developing a trustworthy, efficient process for resolving customer complaints are the two main objectives of the Act. These things:

• Oppose the promotion of products that endanger property and human life.
• Provide consumers information about the potency, quantity, standard, purity, and price of the products to safeguard them from deceptive business tactics.
• Establish consumer protection councils to protect consumers’ rights and interests.
• Whenever practical, ensure that consumers can find a reliable source for reasonable goods.
• Investing in any unethical corporate practices or customer exploitation, as well as looking for solutions.
• choose authorities for the timely and adequate administration and resolution of consumer complaints, you can protect consumers.
• Outline the penalties for Act violations.
• Pay attention to the customer’s welfare concerns, if any problem or dispute arises and make sure they are taken into account in the appropriate forums.
• Educate consumers about their rights by offering them consumer education.
• Provide timely and efficient customer service by using alternative conflict resolution

What are consumer rights under the Consumer Protection Act, of 2019

According to the 2019 Consumer Protection Act, consumers have six rights referred to in Section 2(9) of the Act, which reads as follows:

• The right of a customer to be protected from the promotion of products and services that are risky and harmful to property and life.
• The consumer’s right to know the specifications of commodities, products, or services including their price, quantity, potency, purity, and standard.
• The consumer’s rights to affordable access to a wide range of products, services, and goods.
• The right to complain against unfair and constructive business practices in the appropriate forums.
• The right to just compensation or consideration from the proper consumer forums in the event that the merchant has damaged them.
• The right to receive consumer education.

What are Consumer Protection Laws?

Everyone who pays money for goods or services is considered a consumer under the Consumer Protection Act (NOT for resale). A consumer is also someone who uses the goods or services with permission from the person who made the purchase. The Act covers all products and services, including those offered by the banking, e-commerce, telecom, insurance, electricity, and transportation industries in both the public and private sectors.

The following list includes a few of the legislation and rules passed under the Consumer Protection Act;

Consumer Protection Act (E-Commerce)

In order to fulfill its powers conferred by sub-clause (zg) of sub-section (1) of section 101 of the Consumer Protection Act, 2019 (‘Act’), The Central Government has published the Consumer Protection (E-Commerce) Regulations, 2020 (“the rules”). These regulations largely outline the obligations and liabilities of e-commerce businesses that engage in online marketing and consumer product sales. All electronic retailers (e-retailers), whether registered in India or abroad and providing goods and services to Indian consumers, will be subject to the guidelines. The new regulations provide the federal government the authority to take action against deceptive direct-scale trade practices and online commerce.

Consumer Protection Councils

Central Consumer Protection Council

As per Section 3 of Chapter 2 of the Consumer Protection Act of 2019, the Central Consumer Protection Council which is also known as the Central Council must be created by the Central government. The Central Council’s advisory body must consist of the following people:

The central government’s Department of Consumer Affairs will be headed by the head of the council.

• Any number of members- official or not- who represent the requisite interest as defined by the Act.
• The chairperson of the council will be appointed as the Minister-in-charge of the Department of Consumer Affairs in the Central Government.
• Any number of members- official or non-official- representing necessary interests as defined under the Act.

The Central Council may convene as often as necessary, although they are required to hold at least one meeting annually. In accordance with the Act, the Central Council’s mission is to safeguard and advance consumer interests.

State Consumer Protection Councils

Every state government must create a State Consumer Protection Council, also known as the State Council, with the authority over that particular state. The State Council acts as an advisory body. The State Council’s members are composed of;

the State Government’s Minister who is in charge of Consumer Affairs will be named as the Council’s Chairperson.

• Whatever number of members, whether official or not, is essential to represent the Act’s interest.
• For the purposes of this Act, The Central Government may additionally nominate a minimum of ten individuals.
• At least two meetings of the State Councils must be held annually.

District Consumer Protection Council

As per to Section 8 of the Act, the state government must establish a District Consumer Protection Council, also known as the District Council for each district. The District Council’s members include:

• The collector for that District shall be the chairperson of the District Council.
• Any additional members required by the Act to represent interests.

Central Consumer Protection Authority

To regulate issues relating to consumers rights violations, unfair trade practices, and false or misleading advertisements that are detrimental to the interests of the public and consumers, as well as to promote, protect, and enforce the rights of consumers, the Central Government must create a Central Consumer Protection Authority which is known as the Central Authority under Section 10 of the Consumer Protection Act, 2019. According to the Act, the Central Government will appoint the Chief Commissioner and the other Commissioners of the Central Authority.

According to Section 15 of the Act, the Central Authority must have an “Investigative Wing” to conduct an inquiry or investigation. The Director general as well as the necessary number of Additional Director-Generals, Director-Generals, Directors, Joint Directors, Deputy Directors, and Assistant Directors who have the necessary training and credentials to carry out the duties under this Act, must make up the investigative wing.

Consumer disputes redressal commission

According to the Consumer Protection Act of 2019, the state government must create a District Consumer Disputes Redressal Commission, also known as the District Commission, in each district of the state. A president and a minimum of two members designated by the Central Government must make up the District Commissions.

the District Commission may hear complaints under Section 34 of the Act if the values of the products or services received in exchange do not exceed one crore rupees. The consumer, recognized consumer association, Central Authority, Central Government, State Government, etc. may make a complaint to the district Commission relating to goods and services.

As per Section 36 of the Act, all the proceedings made to the District Commission will be conducted by the President and at least one member of the commission.

Mediation

According to chapter 5 Section 74 of the Consumer Protection Act, 2019, the Central Government shall establish a Consumer Mediation Cell at the national level. It also states that each state government shall establish a Consumer Mediation Cell exercising within the jurisdiction of that state. the mediation will be conducted by the mediator nominated to carry out it within the timeframe and according to the protocols that may be prescribed by the rules.

the Act’s Section 75 discusses the appointment of the mediators. It outlines the requirements, terms, and conditions of service, the appointment process, and the payment obligations to the impaneled mediators.

It is the mediator’s responsibility to disclose certain information that is necessary information for the protection of consumer rights, such as; any personal, financial, or professional outcomes of the consumer dispute, the circumstances that led to the mediator’s independence or impartiality, and any other relevant details.

Product liability

A complainant may file a product liability case against a product seller, product service provider, or product manufacturer under Section 83 of the Act.

Liability of product manufacturers

Under the following circumstances, the product manufacturer will be held liable in a product liability action

• There are Manufacturing defects in the product.
• There is a defective product.
• Manufacturing specifications are not followed correctly.
• The product does not contain enough information for proper usage
• There is a breach of the express warranty with the merchandise.

Liability of product service provider

under the following circumstances, A product service provider will be held accountable in a product liability action;

• When the service provided by them is fake or imperfect, then the service provider will be accountable.
• They neglected their part of the work.
• The service provider didn’t provide sufficient instructions and warnings for the services.
• The service provider didn’t follow the contract’s express warranty or terms and conditions.

Liability of product seller

In the following circumstances, A product seller will be held liable in a product liability action;

They made changes or modifications to the products which resulted in being detrimental to the consumers.

They failed to assemble, inspect, or maintain products with reasonable care.

They had a significant amount of influence over the product which resulted in causing harm to the consumer.

Exceptions to product liability

Section 87 of the Act lists a few exceptions to product liability actions, which include;

• The consumer altered, modified, or misused the product.
• When the manufacturer has provided proper warnings and instructions for the use of the product, a consumer cannot file a product liability action.
• In case of a product liability action, the manufacturer would not be liable for failing to warn of any known harm to the general public.

Offenses and penalties under Consumer Protection Act, 2019

The following list includes the offenses and penalties under this Act;

Penalties for false and deceptive advertisements: According to Section 89 of the Act, any manufacturer or service provider who promotes fake or misleading advertisements, will be punished with up to two years in prison and with a fine that may extend to ten lakh rupees.

Penalties for manufacturing, selling, and distributing products containing adulterants: Section 90 of the Consumer Protection Act, 2019 imposes fines on those who sell, manufacture, or distribute products containing adulterants shall be penalized in case of the following circumstances.

• If the adulterated product results in an injury that is not extremely serious, the sentence for imprisonment will increase to one year, and the maximum punishment is three lakh rupees.
• If the adulterated product results in an injury that are not extremely serious, the sentence for imprisonment will increase to one year and the maximum punishment is three lakh rupees.
• A seven-year prison sentence and a fine that might reach five lakh rupees are possible if the adulterated goods results in an injury that amounts to serious harm.
• If the product results in a consumer’s death, a seven-year prison sentence that might be extended to life in prison, and a fine of at least ten lakh rupees will be imposed.

Penalties for manufacturing, selling, and distributing spurious products: According to Section 91, anyone caught selling, manufacturing, or distributing spurious products shall be punished for such acts.

How to Complain

Each consumer complaint concerning a good or service must be filed in writing with a District Forum by the consumer, along with the fee. Within 21 days from the date of the complaint, the District Forum may reject or approve the complaint. However, a copy of the complaint will be delivered to the opposite party for approval within 45 days.

The goal is to hear each consumer case as quickly as feasible. Also, it is aimed to resolve the complaint within three months of the day the opposing party received notice. As a result, if the complainant is summoned to appear before the District Forum during the proceedings but does not, the District Forum may either dismiss the complaint about default or decide it on merits.

Conclusion

Learning more about one’s rights as a consumer is the first and foremost step toward protecting such rights. Customers must be well aware of their rights and understand when, where, and how they can utilize these and how to exercise them. Customers will benefit from knowing this by being reminded to be vigilant and by feeling more certain that, should something go wrong, they will be able to enforce their rights.