The Lok Sabha passed the Consumer Protection Bill 2019 02/08/2019 – Posted in: Press Information Bureau

Consumer Protection Bill, 2019

(Ministry of Consumer Affairs, Food & Public Distribution)

WHAT

The Lok Sabha passed the Consumer Protection Bill 2019.

 

AIM

  • Protecting the interests of consumers by establishing authorities for timely and effective administration and settlement of consumers’ dispute.
  • The bill aims to simplify the entire process of redressal of consumer grievances.

 

PROPOSED PROVISIONS

  • Under the Bill, there is a provision for the central government to set up a Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers and will be empowered to investigate, recall, refund and impose penalties.
  • It will regulate matters related to violation of consumer rights, unfair trade practices, and misleading advertisements.
  • There is also a provision for class action law suit for ensuring that the rights of consumers are not infringed upon.
  • The authority will have the power to impose a penalty on a manufacturer or an endorser of up to 10 lakh rupees and imprisonment for up to two years for a false or misleading advertisement.

 

FEATURES

Central Consumer Protection Authority (CCPA)

  • Executive Agency to provide relief to a class of consumers. The CCPA will be empowered to-
  1. Conduct  investigations into violations of consumer rights and institute Complaints /Prosecution
  2. Order recall of unsafe goods and services
  3. Order discontinuance of Unfair Trade Practices and Misleading  Advertisements
  4. Impose penalties on Manufactures /Endorsers /Publishers of Misleading Advertisements

 

Simplified Dispute Resolution process

(i) Pecuniary Jurisdiction enhanced to-

  • District Commission –Up to Rs1 crore
  • State Commission- Between  Rs1 crore and Rs 10 crore
  • National Commission –Above Rs.10 crore

(ii) Deemed admissibility after 21days of filing

(iii) Empowerment of Consumer Commission to enforce their orders

(iv) Appeals only on question of law after second stage

(v) Ease of approaching consumer commission

  • Filing from place of residence
  • E-filing
  • Videoconferencing for hearing

 

Mediation

  • An Alternative Dispute Resolution (ADR) mechanism
  • Reference to Mediation by Consumer Forum wherever scope for early settlement exists and parties agree for it.
  • Mediation cells to be attached to Consumer Forum
  • No appeal against settlement through mediation

 

Product Liability

A manufacturer or product service provider or product seller to be responsible to compensate for injury or damage caused by defective product or deficiency in services

The Basis for product liability action will be:

  • Manufacturing  defect
  • Design defect
  • Deviation from manufacturing specifications
  • Not conforming to express warranty
  • Failing to contain adequate instruction for correct use
  • Services provided arefaulty, imperfect or deficient

 

PENALITIES FOR MISLEADING ADVERTISEMENT

  • The CCPA may impose a penalty on a manufacturer or an endorser of up to Rs 10 lakh and imprisonment for up to two years for a false or misleading advertisement.
  • In the case of a subsequent offence, the fine may extend to Rs 50 lakh and imprisonment of up to five years.
  • CCPA can also prohibit the endorser of a misleading advertisement from endorsing that particular product or service for a period of up to one year.
  • However, there are certain exceptions when an endorser will not be held liable for such a penalty.

 

BENEFITS TO CONSUMERS

  • Presently consumers only have a single point of access to justice, which is time-consuming. Additional swift executive remedies are proposed in the bill through the Central Consumer Protection Authority (CCPA)
  • Deterrent punishment to check misleading advertisements and adulteration of products
  • Product liability provision to deter manufacturers and service providers from delivering defective products or deficient services
  • Ease of approaching Consumer Commission and Simplification of the Adjudication process
  • Scope for early disposal of cases through mediation
  • Provision for rules for new-age consumer issues: e-commerce & direct selling

 

CONSUMER DISPUTES REDRESSAL COMMISSION

  • Consumer Disputes Redressal Commissions (CDRCs) will be set up at the district, state, and national levels.
  • A consumer can file a complaint with CDRCs in relation to:
  1. unfair or restrictive trade practices
  2. defective goods or services
  3. overcharging or deceptive charging
  4. the offering of goods or services for sale which may be hazardous to life and safety
  • Complaints against an unfair contract can be filed with only the State and National Appeals from a District CDRC will be heard by the State CDRC.
  • Appeals from the State CDRC will be heard by the National CDRC.
  • The final appeal will lie before the Supreme Court.

 

JURISDICTION OF CDRCs

  • The District CDRC will entertain complaints where value of goods and services does not exceed Rs one crore.
  • The State CDRC will entertain complaints when the value is more than Rs one crore but does not exceed Rs 10 crore.  Complaints with value of goods and services over Rs 10 crore will be entertained by the National CDRC.

 

Source: PIB

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