Consumer Protection Bill, 2018
The Consumer Protection Bill was introduced with the aim of completely overhauling the provisions of Consumer Protection Act, 1986. It was drafted in 2015 and sent to a Standing Committee on Food and Consumer Affairs in 2016. The object behind the Bill is to protect consumer interests and enable quick and effective administration and settlement of disputes by responding to the new changes in the market.
Requirement of the Bill
Although the Consumer Protection Act, 1986 has been playing the role as a legislative measure, of protecting the interest of consumers, there have been several shortcomings that have called for its amendment. Some of the shortcomings are:
- Delay in disposal- There have been practical constraints during disposal of cases under this Act. This has resulted in undue delay in disposal of the cases.
- New challenges-With the advent of globalization, there has been major changes in the market like increase in international trade, expansion of e-commerce resulting in new delivery systems for goods and services, new options to be explored by consumers involving different terms and conditions, tele-marketing, misleading advertisements etc. have given rise to new issues in consumer protection. But these new issues do not come within the ambit of the Act.
In order to address these shortcomings this new Bill is a necessity.
Features of the bill
The key features of this bill are as follows:
Definition of consumer
A consumer is defined as a person who buys any good or avails a service for a consideration. It covers transactions through all modes including offline, and online through electronic means, teleshopping, multi-level marketing or direct selling.
Six Consumer Rights
Six consumer rights have been defined in the Bill which includes right to be protected against marketing of goods and services which are hazardous to life and property, right to be informed of the quality, quantity, potency, purity, standard and price of goods or services, right to be assured of access to a variety of goods or services at competitive prices, and right to seek redressal against unfair or restrictive trade practices.
Concept of Product Liability action
This is a new concept that has been added, which envisages liability of manufacturer, producer or seller in certain circumstances specified herein. These are personal injury, death, damage to property caused to a consumer as a result of any defect in manufacturing, construction, formula, designing, preparation, assembly, testing, service, instruction, marketing, warning, packaging or labeling a product.
Adulteration as Separate Offence
The Bill provides that if a party is found to be guilty of adulteration and this results in death of a consumer, the offender shall be punished with 7 years imprisonment which may be extended to life imprisonment and a fine not less than Rs 1 million.
Class Action Suits
Instead of holding a manufacturer or producer liable only against an affected consumer, now they can be made liable towards a group of consumers. So, consumers can file a class action suit and gain benefit at once.
Definition of e-commerce
It sought to include e-commerce within its ambit by defining it and also sought to give powers to the Central Government for making rules to prevent unfair trade practices.
Central Consumer Protection Authority
The bill provides for setting up of Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers. The CCPA will have an investigation wing, headed by a Director-General, which may conduct inquiry or investigation into matters such as violation of consumer rights, unfair trade practices, and misleading advertisements.
Penalties for misleading advertisement and false complaints
The CCPA may impose a penalty on a manufacturer or an endorser for a false or misleading advertisement. The penalty for bringing false or frivolous claims has been increased from Rs 10,000 to Rs 50,000.
Consumer Disputes Redressal Commission
The bill provides for setting up of Consumer Disputes Redressal Commissions (CDRCs) at the district, state, and national levels.
Electronic Complaints
New provisions are being made to file complaints online, which shall be admitted within a period of 21 days from the date on which the complaint is filed. If the admission is not done within 21 days it is deemed that the complaint has been accepted.
Pecuniary jurisdictions
New limits have been set for the pecuniary jurisdiction of Consumer Disputes Redressal Agencies. For the District Consumer Forum the limit has been extended to Rs 10 million from earlier Rs 2 million. The limit of the State Consumer Forum has been set at Rs 10 million to Rs 100 million. In case of value exceeding Rs 100 million the National Consumer Redressal Forum can be approached.
Mediation Cell
The bill provides for establishment of mediation cell attached to Consumer Disputes Redressal Commission at district, state, and national levels.
Significance of the bill
- It reflects the realities of 21stcentury by widening of the definition of the consumer to include online, teleshopping etc.
- Setting up of Central Consumer Protection Authority will provide for an institutional mechanism for dealing with matters related to consumer interests.
- It provides for extended liabilities on the manufacturer or an endorser for a false or misleading advertisement. Celebrity status was often misused to market fraudulent products.
- Provision of mediation cell will promote alternate adjudication mechanisms and reduces burden on the judiciary.
The consumer rights protection mechanisms needs to be strengthened so that the consumers are well aware of the rights and there is an effective mechanisms to uphold the consumer rights. The bill is a step forward in that direction.
