This era is considered as the era of the consumers where the king of the market is the consumer only. No country will let the consumer disregard its interest. To safeguard the interest of consumers the government of India has introduced the Consumer Protection Act 2019. The main objective of the act is to protect the interest of consumers. The provisions of the act do not protect the interest of the consumers only but are compensatory in nature too. The act does provide a speedy and cost-saving redressal to the consumers. This article does highlights various provisions and key features of the CP act, 2019. Moreover, it(article) does try laying down the comparative study between CPA 1986 and CPA2019.
Why do we need Consumer protection?
A consumer is said to be the king in a free market economy as in a free market economy price determination is done on the basis of demand and supply only. The earlier approach of Caveat emptor which means let the buyer beware has now been changed to caveat vendor (let the seller beware). Due to the growing competition and an attempt to increase their sales and market share may be tempted to engage in unscrupulous, exploitative and unfair trade practices like defective and unsafe products, adulteration, false and misleading advertisement. Due to all these practices, consumers might suffer from bad health-related issues. Moreover, the consumer might have to pay a higher price when sellers engage in practices like overpricing, hoarding, etc. Here to provide adequate protection to the consumer against such practices consumer protection act is necessary.
Importance of consumer protection
Consumer protection is essential for a consumer as well as a businessman. Consumer protection has a wide agenda as its objective is not only to educate consumers about their rights and responsibilities but also helps in getting their grievances redressed. Not only a piece of Judicial machinery is required for protecting the interests of the consumer but it also requires the consumer to get together and form a consumer association for protection and promotion of their rights.
From a consumer point of view
The consumer is not well aware of his rights and responsibilities which leads to consumer ignorance and therefore it does become necessary to educate them. Consumers do get exploited very often due to unfair trade practices like defective and unsafe products, adulteration, false and misleading advertising, hoarding and black marketing and due to these reasons, a need to organize consumers do emerges into a consumer organization that would take care of their interest.
From the business point of view
- Long-term interests of the business: The main aim of the firms should be long-term profit maximization through consumer satisfaction. To maintain a long-term interest of the firm, the consumer shall be satisfied with the sales and other services of the firm and a satisfied consumer will not only increase the sale but also provide feedback to prospective consumers.
- Business uses resources of society: The business person uses the resources of the society only so it’s the responsibility of the business person to supply goods and services which are in the interest of the public.
- Social responsibility: There are many stakeholders of the firm(business) and one of those stakeholders is the consumers only, therefore, it’s a social responsibility of the firm to be fair enough while doing business in the market.
- Moral justification: It’s the moral duty of a business to take care of the consumer’s interest and avoid any kind of exploitation.
- Government interventions: Government does intervene in the business regulations but is quiet when the company/firms are not exploitative with their consumers.
Various laws enacted by the government concerning consumer protection
- The Consumer Protection Act, 1986 (COPRA) was an Act of the Parliament of India enacted in 1986 to protect the interests of consumers in India. It was replaced by the Consumer Protection Act, 2019. It was made for the establishment of consumer councils and other authorities for the settlement of consumer’s grievances and matters connected therewith it. The act was passed in Assembly in October 1986 and came into force on December 24, 1986. The statute on the right was made before this COPRA act.
- The Indian Contract Act, 1872 prescribes the law relating to contracts in India and is the key act regulating Indian contract law. The Act is based on the principles of English common law. It applies to all the states of India. It determines the circumstances in which promises made by the parties to a contract shall be legally binding. Under Section 2(h), the Indian Contract Act defines a contract as an agreement that is enforceable by law.
- The Indian Sale of Goods Act, 1930 is a Mercantile Law, which came into existence on 1 July 1930, during the British Raj, borrowing heavily from the Sale of Goods Act 1893. Its provisions for the setting up of contracts where the seller transfers or agrees to transfer the title (ownership) in the goods to the buyer for consideration. It is applicable all over India, except Jammu and Kashmir. Under the act, goods sold from owner to buyer must be sold for a certain price and at a given period. The act was amended on 23 September 1963 and was renamed the Sale of Goods Act, 1930. It is still in force in India, after being amended in 1963 and in Bangladesh as the Sale of Goods Act, 1930 (Bangladesh).
- The Essential Commodities Act (ECA) is an act of the Parliament of India that was established to ensure the delivery of certain commodities or products, the supply of which, if obstructed due to hoarding or black marketing, would affect the normal life of the people. This includes foodstuff, drugs, fuel (petroleum products), etc. This act was modified by the Essential Commodities (Amendment) Act, 2020 as part of the 2020 Indian farm reforms.
- The Agricultural Marketing Agreement Act of 1937 provides authority for federal marketing orders, and also reaffirmed the marketing agreements provisions of the Agricultural Adjustment Act of 1933.
- Prevention of Food Adulteration Act.
The prevention of Food Adulteration Act, (PFA) 1954 operated by the Directorate General of Health Services, Ministry of Health was designed for the following purposes :
1. It formulates and monitors the standard of quality and purity of foods with an emphasis on the prevention of adulteration of foods.
2. It is the basic structure intended to protect the common consumer against the supply of adulterated foods.
3. It makes provision for the prevention of adulteration of food and lays down the rule that no person shall manufacture for sale, store, sell or distribute any adulterated or misbranded food or food which contravenes the provision of act or rules.
4. It has set the yardstick to ascertain adulteration. According to this act, a food is deemed to be adulterated.
5. It is not of nature, substance and quality, which the food ought to be.
6. It contains any other substance which affects, or if the article is so processed to affect injuriously the nature, substance and quality of the food.
7. It contains added inferior or cheaper substance that affects the nature and quality of the food.
8. Any constituent of the food is removed to affect injuriously the nature, quality and substance of the food.
9. It is prepared, packed and stored under unsanitary conditions.
10.It contains any filthy, disgusting, rotten, decomposed substance of a diseased animal or vegetable substance or is insect-infested or otherwise unfit for human consumption.
- The Standard of Weights and Measures Act, 1976 was enacted to establish standards of weights and measures, to regulate inter-state trade or commerce in weights, measures and other goods which are sold or distributed by weight, measure, or number, and to provide for matters connected therewith or incidental thereto. The Act extends to the whole of India.
- Trademark rights in India are statutorily protected by the Trademark Act, 1999 and also under the common law remedy of passing off. The administration of such protection under the Act is done by the Controller General of Patents, Designs and Trademarks. The Trademark Act, 1999 deals with the protection, registration and prevention of fraudulent use of trademarks. It also deals with the rights of the holder of the trademark, penalties for infringement, remedies for the damaged as well as modes of transference of the trademark.
- The Bureau of Indian Standards (BIS) is the national Standards Body of India working under the aegis of Ministry of Consumer Affairs, Food & Public Distribution, Government of India. It is established by the Bureau of Indian Standards Act, 1986 which came into effect on 23 December 1986. The Minister in charge of the Ministry or Department having administrative control of the BIS is the ex-officio President of the BIS.
Consumer protection act 2019
Consumer protection bill was introduced in Lok Sabha by Mr. Ram Vilas Paswan the minister of consumer affairs, food and public distribution on 8th July 2019, was enacted in Lok Sabha on 30th July 2019, was passed on 2nd August 2019 and a final assent was given by the President (Ram Nath Kovind) on 9th August 2019. Cp act 2019 do repeals and replaces the Consumer protection act 1986 and it is applicable in India.
The law enacted does protect the interest of the consumers. The basic aim of the Consumer Protection act, 2019 is to save the right of the consumers by establishing authorities for timely and effective administration and settlement of consumer disputes. The act does possess the feature of saving the rights of the consumers as speedy redressal to the consumer grievance is required.
Definition of consumer
As per the act, a person is who avails the services and buys the good for persona consumption is called as a consumer. The definition does cover all types of transactions that are online and offline. If a person who buys goods and avails any services for retail or the commercial purpose is not considered to be a consumer.
Key features of the act
Central consumer protection authority would be established under the act which will protect, promote and enforce the rights of practices, misleading advertisements and violation of consumer rights. The act does hold the power to impose a penalty on the violators of the laws mentioned under the act moreover an investigation wing would be established under the act for such violators. Broadly regulatory moves of the cp act will be directed towards the manufacturers, sellers and service providers and will not address the consumer’s grievance and dispute directly.
Rights of the consumers
The consumer does possess the following rights-
- To have information about the quality, quantity, purity, price and standards of goods or services.
- To be protected from hazardous goods and services.
- To be protected from unfair trade practices or restrictive trade practices.
- To have a variety of goods or services at competitive prices.
Prohibition and penalty foe misleading advertisement
C.P act will have the power to impose fines on the endorser or manufacturer up to 2 years of imprisonment for misleading or false advertisement and if the offence is repeated the fine imposed will be amounting to 50 lakhs and imprisonment up to five years.
Consumer Dispute Redressal Commission (CDRCS)
- Provisions of the establishment of consumer dispute redressal commission at the national, state and district level.
- CDRCS will entertain the complaints related to-
- Overcharging and deceptive
- Unfair or deceptive
- Sale of hazardous goods and services which may be hazardous to life
- Sale of defective goods or services.
Jurisdiction under the consumer protection act, 2019
The national consumer dispute redressal commission will hear complaints worth more than 10 crores, the state CDRC will hear complaints of more than one crore but less than 10 crore rupees and the district CDRC will hear the complaints with a value of goods or services up to 1crore rupees.
Consumer protection act 1986
C.P act 1986 is considered an important part of the history of India. Here the objective of the councils is to protect the interests of the consumers. The act was passed by the parliament in 1986 and came into force with effect from July 1987. The Act extends to the whole of India except Jammu and Kashmir.
Key features of the act
- Coverage of items: Applies to all products and services unless the government of India makes some items out of the scope of it and by the amendment in 1993 by including complaints relating to restrictive trade practices, complaints against goods which are hazardous to life and safety of consumers and information has not been given about the content and the usage of the product.
- Coverage of sectors: applies to public, private and joint sectors.
- The provisions laid down in the Act are compensatory.
- Group of consumers rights provisions for lodging complaints by consumers having the same interest.
- The establishment of three-tier redressal machinery is there under the act.
- The facility of time-bound redressal can be seen.
- Do imposes punishments to those consumers who do file a false and meaningless complaint.
Rights to the consumer under the act
- Right to consumer education– Knowledge of the availability of a legal remedy should be so widely explained, advertised and circulated so that people become aware.
- Right to safety– protecting against the marketing of dangerous goods and services.
- Right to seek redressal– remedy against unfair trade practices.
- Right to choose– Right to access the variety.
- Right to information- Right to be informed about the product’s quality, quantity, purity and price.
Consumers have been facing a lot of unfair trade practices and market manipulations too in its day to day life. Consumer protection act, 2019 comprises of all the major concerns that a consumer may face. CP act, 2019 is not just an act but a warning for the people involved in unfair trade practices moreover it acts as a caution for manufacturers, sellers and service providers, giving more power to the consumers.