NEW CONSUMER PROTECTION BILL, 2018

INTRODUCTION

The consumer protection law was made in 1986 to provide for better protection of the interests of consumers and to establish consumer protection councils for settlement of consumer disputes the government feels the working of the consumer disputes Dressel agencies have served the purpose to a great extent but disposal of cases has not been fast due to various constraints on consumer markets for goods and services have under gone drastic transformation in the last three decades the emergence of global supply chains rise in international trade and the rapid devdelopment of e-commerce have led to new delivery systems for goods and services and have provides new options and opportunities for consumers equally this has rendered the consumer wonderful two new forms of unfair trade and unethical bussiness practice, misleadnig advertisements, telemarketing, multi level marketing, Direct selling of e-commerce pase new challenges to consumer protection and need swift executive interventions to prevent consumer troubles.

The consumer protection bill 2018 provides for the establishment of an executive agency to be known as the central consumer protection authority CCPA to promote protect and enforce the rights of consumer it will deal with matters related to violation of consumer rights unfair trade practices and misleading advertisement the CCPA will have an investigation wing headed by a director general which may conduct inquiry and investigations of violations the CCPA has been empowered to inquire into violations of consumer rights. Investigation and prosecution it will have hours to recall goods or withdraw services that the hazardous reimbursements of the price paid and discontinuation of the unfair trade practice it will be able to issue directions to the concerned entity to either discontinue of false or misleading advertising or modified it will be able to impose penalties and he should safely notice to consumers against dangerous or unsafe goods and services the bill also details six consumer rights which include the rights.

RECENT DEVELOPMENT  

In 2011, a bill to amend the 1986 Act was introduced to enable consumers to file online complaints and against unfair terms in a contract. However, the bill lapsed with the dissolution of the 15th Lok Sabha. The consumer protection Bill 2015 was introduced in Lok Sabha to replace the 1986 act the bill introduced various new provisions, which included (i) Product Liability (ii) unfair Contracts (iii) Setting up of a regulatory body. The bill was examined by the standing committee on consumer affairs which submitted its report in April 2016. The committee gave several recommendations with regard to (i) product liability (ii) Power and functions of the regulatory body (Central consumer protection Authority) being set up (iii) penalties for misleading advertisements and endorsers of such advertisements (iv) pecuniary jurisdiction of the adjudicatory body at the district level.

The consumer protection bill, 2018 was introduced in Lok Sabha by the minister consumer affairs food and public distribution Ram Vilas Paswan on January 5th, 2018 the bill replaces the consumer protection Act, 1986 a consumer protection bill to replace the act was introduced in 2015 but has been withdrawn after the introduction of the latest 2018.

KEY FEATURES OF THE BILL

Consumer Complaints 

The Bill setup consumer Disputes Redressal Commissions (Consumer court) to hear complaints on matters like (i) Defect in goods or deficiency in services (ii) unfair or restrictive trade practices (iii) Excessive pricing (iv) knowingly selling goods or providing services that do not meet safety norms; and (v) product liability such complainant can be filed electronically and from where the complainant resides or works.

These commissions will be set up a District, State, and National level with pecuniary jurisdiction up to Rs one crore, Rs one crore to 10 crores and above Rs 10 Crore respectively. In case of unfair contracts, the state commissions will hear complaints, where the value is up to Rs 10 crore and National Commission will hear complaints above that value. These commissions can declare unfair terms of such contracts to be null and void.

Appeal 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 Commission will attempt to dispose a complaint within three months if the complaint does not require analysis or testing of commodities if analysis and testing are required the complaints will be disposed within a period of five months.

The District Commissions will consist of a president and at least two members. The state and National commission will consist of a president and at least four members the qualifications of tenure, and method of appointment and removal of the president and member of these commissions will be prescribed by central government through notification.

The bill also provides for mediation cell attached to the district, state and national commission. The commissions may refer a matter for mediation if the parties consent to settle their dispute in this manner.

Central Consumer Protection Authority

The bill set up the central consumer protection authority (CCPA) to promote, protect and enforce the rights of consumers as a class it will be headed by a chief commissioner and comprise other commissioners. it may (i) issue safety notices (ii) pass orders to recall goods prevent unfair and restrictive trade practices (iii) reimburse purchase price paid and (iv) impose penalties for false and misleading advertisements. It may also file complaints before the consumer Dispute redressal commissions.

Consumer Protection Councils 

The bill sets up consumer protection councils (CPCs) at district, state, national level as advisory bodies. The council will advise on promotion and protection of consumer rights under the bill the central and state council will be headed by the minister-in-charge of consumer affairs at the central and state level respectively. The district council will be headed by the district collector.

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. A claim for compensation may be made for any harm caused including (i) Property damage (ii) Personal injury, illness or death (iii) Mental agony or emotional harm accompanying.

UNFAIR CONTRACT 

A contract is said to be unfair it is causing a significant change in the rights of the consumer which include the following

  •  Requiring excessing securing deposits
  • Imposing a disproportionate penalty for a breach of contract
  • Refusing to accept early repayment of debts
  • terminating the contract without reasonable cause
  • transferring a contract to a third party to the detriment of the consumer without his consent
  • Imposing unreasonable charge of obligations which put the consumer at a disadvantage.

The state and National commissions may determine if the terms of a contract are unfair to declare such terms to be and void.

UNFAIR AND RESTRICTIVE TRADE PRACTICE

  • Making a false statement regarding the quality or standard of a good or service
  • Selling of goods not complying with the standard
  • manufacture of spurious goods
  • Non-issuance of a receipt for a good or service sold
  • refusing to withdraw or refund goods or services within 30 days
  • Disclosing personal information provided by a consumer to any other person
  • A restrictive trade practice is one that imposes unjustified costs or restrictions on consumers, including (i) delays in supply that lead to increase in price (ii) Requiring purchase of certain goods or services.
  • The CCPA may take steps to prevent and discontinue unfair and restrictive trade practices. The district, state or national commissions may order the discontinuation of unfair and restrictive trade practices.

PENALTIES UNDER THIS BILL

  • 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.
  • If a person does not comply with an order issued by the CCPA, he may face imprisonment of up to six months or a fine of up to Rs 20 lakh or both.
  • For false and misleading advertisements, a Penalty of up to Rs 10 Lakh may be imposed on a manufacturer or an endorser for a subsequent offence, the fine may extend to Rs 50 Lakh. the manufacturer can also be punished with imprisonment of up to two years, which may extend to five years in case of every subsequent offence.
  • The CCPA can also prohibit the endorses of a misleading advertisement from endorsing any particular product or service for a period of up to one year for every subsequent offence the period of prohibition may extend to three years. There are certain exceptions when an endorser will not be held liable for such a penalty.
  • The CCPA may also impose penalties for manufacturing, selling storing, distributing or importing adulterated products. The penalties are as follows.
    1. If the injury is not caused to a consumer, the penalty would be a fine of up to Rs one lakh alone with imprisonment of up to six months.
    2. if the injury is caused, the penalty would be a fine up to Rs three lakh along with imprisonment of up to one year.
    3. if grievous hurt is caused penalty would be a fine up to Rs five lakh with imprisonment up to seven years.
    4. In case of the death, the penalty would be Rs ten lakh or more along with a minimum imprisonment of seven years, extendable to imprisonment for fine.

Source

[1] PRS Legislative Research

[2] Bill 2018,  Click Here

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About Lalit Sharma

Student of Constitution Law.
This entry was posted in Consumer Law, Important Bills and Acts. Bookmark the permalink.

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