Overview of the Consumer Protection Act, 2019

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The Consumer Protection Act, 2019 finally replaced the 3-decade-old Consumer Protection Act, 1986. It received the assent of the President of India and was published in the official gazette on 9th August 2019. It came into force recently on 20th July 2020. The analysis of the 2019 act is important for two reasons. First, it introduces various new terms and provisions, including the much-needed definition of e-commerce. Second, it brings significant amendments to the key sections of the 1986 Act, thereby widening its scope. This piece of work aims to highlight the new as well as the amended aspects of this act and draw a comparison with the old act in these aspects.

Need for the 2019 Act 

There was a need for this act to be enacted in order to provide timely and effective administration and settlement of consumer disputes. With the advancement of technology and the growing predominance of e-commerce, there was a need felt to revamp the law and sink it with the societal changes.  This replacement is done primarily to meet the increasing needs of the modern-day consumer. It extends the basic rights of a consumer to e-commerce consumers. There are six basic rights of a consumer in India– Right to Safety, Right to Choose, Right to seek Redressal, Right to be Informed, Right to consumer education, Right to be heard. This act thus aims to protect these rights by introducing new procedures and terms. 

1986 Act v/s 2019 Act

S.No. Basis Consumer Protection Act, 1986 Consumer Protection Act, 2019
1 Scope All goods & services for consideration, while free and personal services were excluded All goods & services, including telecom and housing construction and all modes of transactions (online, etc.) for consideration, while free and personal services are excluded. 
2 Product Liability No Provision Claim for product liability can be made against a manufacturer, service provider, and seller. Compensation can be obtained by proving one of the several specified conditions in the Act.
3 Pecuniary jurisdiction of Commissions District: Up to Rs 20 lakh; 

State: Between Rs 20 lakh and up to Rs one crore;

 National:  Above Rs one crore.

District: Up to Rs one crore;

 State: Between Rs one crore and up to Rs 10 crore; 

National:  above Rs 10 crore.

4 Unfair contracts No Provision Contracts that cause a significant change in consumer rights. Lists six contract terms which may be held as unfair.
5 Central Protection Councils (CPCs) CPCs promote and protect the rights of consumers. They are established at the district, state, and national level. The new Act makes CPCs advisory bodies for promotion and protection of consumer rights. Establishes CPCs at the District, State and National Level.
6 E-commerce No Provision Defines direct selling, e-commerce and electronic service provider. The central government may prescribe rules for preventing unfair trade practices in e-commerce and direct selling.
7 Regulator No Provision Establishes the Central Consumer Protection Authority (CCPA) to promote, protect, and enforce the rights of consumers as a class.   CCPA may: issue safety notices;  pass orders to recall goods, prevent unfair practices, and reimburse purchase price paid; and impose penalties for false and misleading advertisements.
8 Composition of Commissions District: Headed by current or former District Judge and two members. State:  Headed by a current or former High Court Judge and at least two members. National:  Headed by a current or former Supreme Court Judge and at least four members. District:  Headed by a president and at least two members. State:  Headed by a president and at least four members. National:  Headed by a president and at least four members
9 Alternate dispute redressal mechanism No Provision Mediation cells will be attached to the District, State, and National Commissions
10 Penalties If a person does not comply with orders of the Commissions, he may face imprisonment between one month and three years or fine between Rs 2,000 to Rs 10,000 or both. If a person does not comply with orders of the 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. (in case he does not suffer any injury.)
11 Appointment Selection Committee (comprising a judicial member and other officials) will recommend members on the Commissions. No provision for Selection Committee.  Central Government will appoint through notification.
12 Appeals Earlier 30 days period for appeal against the order of District forum  Now, it is for 45 days.

 

Offences and penalties under the 2019 Act

For non-compliance of orders 

    • Imprisonment from 1 month to 3 years; Fine from Rs. 25,000/- to Rs. 1,00,000 /- or both.

For products containing adulterants 

      1. If it does not result in injury– Imprisonment: Up to 6 months Fine: Up to Rs 1,00,000/-
      2. Injury not amounting to grievous hurt-  Imprisonment: Up to 1 year Fine: Up to Rs. 3,00,000/-
      3. Injury resulting in grievous hurt-  Imprisonment: Up to 7 years Fine: Up to Rs. 5,00,000/-
      4. For causing the death of consumer-  Imprisonment: Up to 7 years extended Up to life imprisonment   Fine: Up to Rs. 10,00,000/-

For Spurious Goods

    1. Injury not amounting to grievous hurt-  Imprisonment: Up to 1 year Fine: Up to Rs. 3,00,000/-
    2. Injury resulting in grievous hurt-  Imprisonment: Up to 7 years Fine: Up to Rs. 5,00,000/-
    3. For causing the death of consumer–  Imprisonment: Up to 7 years extended Up to life imprisonment   Fine: Up to Rs. 10,00,000/-

Conclusion 

All-in-all the 2019 Act is a positive step towards reformation and development of consumer laws, in the light of dynamically changing socio-economic developments. We can say that the Consumer Protection Act, 2019 is one of the sincerest steps taken by the central government for enhancing consumer rights and speedy delivering of justice. The new Act encompasses multiple aspects such as Mediation and E-commerce, which the world was unaware in 1986. It is crucial to amend the act when digitalization has changed the way a consumer conducts transactions online, especially when the mode of purchase has shifted from offline to online. Certainly 2019 Act is a positive step towards reformation, development and enhancing consumer rights, but the real test for the 2019 Act is in its implementation, and some leeway needs to be given for it to actualize the relief for the consumers.


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