The Consumer Protection Act, 2019 is an Act of the Parliament of India. It repeals and replaces the Consumer Protection Act, 1986.

Consumer Protection Act, 1986 ( the old act )

The Consumer Protection Act, 1986 (COPRA) was an Act by the Parliament of India aimed at protecting 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 dispute and matters connected with it.

History

Consumer rights in India were historically overlooked, leading to exploitation of consumers by businesses. This necessitated the creation of a robust legislation to protect consumers from unfair practices, hence the ‘Consumer Protection Act, 1986’ was introduced. This act was introduced under slogan Jago Grahak Jago.

Significance

This Act is regarded as the ‘Magna Carta’ in the field of consumer protection for checking unfair trade practices, ‘defects in goods’ and ‘deficiencies in services’. It has led to the establishment of a widespread network of consumer forums and appellate courts all over India. It has significantly impacted how businesses approach consumers and have empowered consumers to a greater extent.

Consumer Protection Council

Consumer Protection Councils are established at the national, state and district level to increase consumer awareness. They guide consumers on how to file cases in the Consumer Disputes Redressal Commissions.

Various Consumer Organizations

To increase the awareness of consumers, there are many consumer organisation and NGOs that have been established. Consumer Guidance Society of India (CGSI) was the first consumer organisation established in India in 1966; It was followed by many others such as:

• Consumer Education And Research Centre (Gujarat)
• Bureau Of Indian Standards
• Federation Of Consumer Organisation In Tamil Nadu
• Mumbai Grahak Panchayat
• Consumer Voice (New Delhi)
• Legal Aid Society (Kolkata)
• Akhil Bhartiya Grahak Panchayat
• The Consumers Eye India.
• United India Consumer’s Association.
• All India Consumer Welfare Council (AICWC)
• Consumer Protection Council Tamil Nadu

Consumer Disputes Redressal Agencies

• District Consumer Disputes Redressal Commission (DCDRC): Also known as the “District Commission” is established by the State Government in each district of the State. The State Governments may establish more than one District Forum in a district. It is a district-level court that deals with cases valuing up to ₹10 million (US$100,000).
• State Consumer Disputes Redressal Commission (SCDRC): Also known as the “State Commission” established by the State Government in the State. It is a state-level court that takes up cases valuing less than ₹10 million (US$100,000)
• National Consumer Disputes Redressal Commission (NCDRC): Established by the Central Government. It deals with matters of more than ₹10 million.

Objectives of the central council

The objectives of the Central Council are to promote and protect the rights of the consumers such as:-

1. The right to be protected against the marketing of goods and services which are hazardous to life and property.
2. The right to be informed about the quality, quantity, potency, purity, standard and price of goods or services, as the case may be to protect the consumer against unfair trade practices;
3. The right to be assured, wherever possible, access to a variety of goods and services at competitive prices;
4. The right to be heard and to be assured that consumer’s interest will receive due consideration at appropriate forums;
5. The right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers
6. The right to consumer education
7. The right to consumer protection

Jurisdiction/Three Tier System of Council Courts

Jurisdiction of District Forum

1. Subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed does not exceed rupees one crore.
2. A complaint shall be instituted in a District Forum within the local limits of whose jurisdiction:-

a) – the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain, orb) – any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office, or personally works for gain, provided that in such case either the permission of the District Forum is given, or the opposite parties who do not reside, or carry on business or have a branch office, or personally work for gain, as the case may be, acquiesce in such institution; orc) – the cause of action, wholly or in part, arises.

Consumer courts do not have jurisdiction over matters where services or goods were bought for a commercial purpose.

Jurisdiction of State Commission

Subject to the other provisions of this Act, the State Commission shall have jurisdiction:-

a) to entertain :

• i) complaints where the value of the goods or services and compensation, if any, claimed exceeds rupees one crore but does not exceed rupees ten crore; and
• ii) appeals against the orders of any District Forum within the State; and

b) to call for the records and pass appropriate orders in any consumer dispute

Jurisdiction of National Commission

a) to entertain—

• (i) complaints where the value of the goods or services and compensation, if any, claimed exceeds rupees ten crore; and
• (ii) appeals against the orders of any State mayor; and

(b) to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any State Commission. However, the Supreme Court of India has held that the jurisdiction of National Commission under Revision Jurisdiction is very limited and can only be exercised when State Commission exceeds its jurisdiction, fails to exercise its jurisdiction or there is material illegality in the order passed by State Commission.

Consumer Protection Act, 2019 ( the new act )

The Consumer Protection Act, 2019 was introduced in the Lok Sabha as a replacement of COPRA, 1986 on 8 July 2019 by the Minister of Consumer Affairs, Food and Public Distribution, Ram Vilas Paswan. It was passed by Lok Sabha on 30 July 2019 and later passed in Rajya Sabha on 6 August 2019.

The bill received assent from the President Ram Nath Kovind on 9 August, and was notified in The Gazette of India on the same date. The Act came into effect by 20 July 2020, while certain other provisions of the Act like establishing the Central Consumer Protection Authority came into effect from 24 July 2020.

The Act focuses on giving customer more power by taking transparency to another level. In September 2020 government declared a new draft known as advertising code which gives customer protection against false advertisements.

Provisions

The Consumer Protection Act has made it mandatory for every e-commerce entity to display the country of origin.

Councils, Authorities and Commissions established

This act is also focused on continuing the formally defined institutions created by the COPRA,1986 to take up cases and decisions related to consumer protection. It allows the central government to move away the burden of establishing consumer protection laws from the parliament and the burden of litigation from the courts; by providing an alternate pathway for the governments and citizens alike to approach, deliberate, discuss and decide on matters related to consumer protection in the interest of consumers.

Consumer Protection Authority (Body)

This act also allows for the establishment of independent statutory authority bodies on both the levels of the centre and the state to have jurisdiction over consumer protection law and cases. These bodies have a wide range of powers, including but not limited to search and seizure, declaration of judgements, protection of good-faith decisions. These bodies have formal internal structure with their own investigative wing to conduct research into a particular case.

They have the right to recall goods, refer the matter to other regulators for investigating a case on all fronts, to issue directions and penalties against false or misleading advertisements.

Consumer Disputes Redressal Commission (Body)

This act allows for the creation of commissions to which consumers can approach and place their concerns on the levels of the district, state, and centre. They function in a manner similar to the courts, and have complete jurisdiction over declaration of case judgements. Their function is similar to ones defined in the COPRA, 1986.

Consumer Protection Councils (Body)

The job of the body is to advise the central government and the prime minister on issues to be mitigated and policies to be made regarding consumer protection.

Rights of consumers

The consumer protection bill 2019 primarily defines the following consumer rights.

1. Be protected against marketing of goods and services which are hazardous to life and property.
2. Be informed of the quality, quantity, potency, purity, standard and price of goods and services.
3. Be assured of access to a variety of goods or services at competitive prices.
4. Seek redressal against unfair and restrictive trade practices.

Recommended Reads to explore more about this topic:

Consumer Protection Act: A Commentary by G.B. Reddy and Baglekar Akash Kumar

Consumer Claims by Akanksha Rana