Context

The Parliament had passed the Consumer Protection Bill, 2019 which aims to protect the rights of consumers by establishing authorities for timely and effective administration and settlement of consumers’ dispute. The Bill will replace the more than three decades old Consumer Protection Act, 1986.

Key Provisions of the Bill

• Definition
• • A consumer is defined as a person who buys any good or avails a service for a consideration. It does not include a person who obtains a good for resale or a good or service for commercial purpose.
• Consumer Complaints
  • The Bill sets up Consumer Disputes Redressal Commissions (consumer courts) to hear complaints by the consumers.
  • These Commissions will be set up at District, State and National level, with pecuniary jurisdiction up to Rs 1 crore, Rs 1 crore to Rs 10 crore, and above Rs 10 crore, respectively.
  • The District Commissions will consist of a President and at least two members. The State and National Commissions will consist of a President and at least four members.
  • Appeals from the District Commissions will be heard by the State Commission, and from the State Commission by the National Commission. Appeals from the National Commission will be heard by the Supreme Court.
  • The Commissions will attempt to dispose a complaint within three months, if the complaint does not require analysis or testing of commodities. If analysis and testing is required, the complaint will be disposed within a period of five months.
  • The Bill sets up the Central Consumer Protection Authority (CCPA) to promote, protect, and enforce the rights of consumers as a class.
• Product Liability
  • The Bill allows a person to make a claim of product liability against a manufacturer, seller, or service provider for any defect in a product or deficiency in a service
• Unfair contracts
  • A contract is said to be unfair if it causes significant change in the rights of the consumer like demanding excessive security deposits, imposing a disproportionate penalty for a breach in contract etc.
  • The State and National Commissions may determine if the terms of a contract are unfair and declare such terms to be null and void.
• Unfair and restrictive trade practices
  • An unfair trade practice includes making a false statement regarding the quality standard of a good or service or selling of goods not complying with standards etc.
  • A restrictive trade practice is one that imposes unjustified costs or restrictions on consumers, including delays in supply that lead to increase in price or requiring purchase of certain goods or services as a condition for procuring any other goods or services etc.
  • The CCPA may take steps to prevent and discontinue unfair and restrictive trade practices.
• Penalties
  • If a person does not comply with the orders of the District, State or National Commissions, he may face imprisonment up to three years, or a fine not less than Rs 25,000 extendable to Rs one lakh, or both.