New Consumer Protection Act, with more teeth and covering e-commerce, comes into force

Vibha Sharma

Tribune News Service

New Delhi, July 20

The Consumer Protection Act, 2019, empowering consumers and seeking to revamp the process of administration and settlement of consumer disputes with strict penalties, including jail term for adulteration and misleading advertisements by firms and punishment for manufacture or sale of products containing adulterant or spurious goods, came into force from today.

It proposes setting up of a Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers as a class. The CCPA would make interventions to prevent consumer detriment arising from unfair trade practices. The agency can also initiate class action, including enforcing recall, refund and return of products.

The rules also specify the duties and liabilities of e-commerce entities (Market place and Inventory Model) and sellers on market place e-commerce entities.

BENEFITS TO CONSUMERS

• The CP Act 1986 -- single point of access to justice, which is time consuming. Additional swift executive remedies provided through CCPA

• Deterrent punishment to check misleading advertisements and adulteration of products

• Product liability provision to deter manufacturers and service providers from delivering defective products or deficient services

• Ease of approaching Consumer Commissions and simplification of adjudication process

• Scope for early disposal of cases through mediation

• Provision for rules for new age consumer issues: e-commerce & direct selling

Every e-commerce entity is required to provide details about it on its platform. “It shall acknowledge the receipt of any consumer complaint within forty-eight hours and redresses the complaint within one month from the date of receipt.”

They are also required to provide information relating to return, refund, exchange, warranty and guarantee, delivery and shipment, modes of payment, grievance redressal mechanism, payment methods, security of payment methods, charge-back options, etc.

“A seller on a marketplace will provide all relevant details about the goods and services offered for sale, including country of origin, which are necessary for enabling the consumer to make an informed decision at the pre-purchase stage,” it says.

Salient features of the Act include establishment of the CCPA, empowered to conduct investigations into violations of consumer rights and institute complaints and prosecution, order recall of unsafe goods and services, order discontinuance of unfair trade practices and misleading advertisements, impose penalties on manufacturers/endorsers/publishers of misleading advertisements.

The new Act provides for simplifying the consumer dispute adjudication process in the consumer commissions, which include, among others, empowerment of the State and District Commissions to review their own orders, enabling a consumer to file complaints electronically and file complaints in consumer commissions that have jurisdiction over the place of his residence, videoconferencing for hearing and deemed admissibility of complaints if the question of admissibility is not decided within the specified period of 21 days.

Mediation as an Alternate Dispute Resolution mechanism has been provided in the new Act. This will simplify the adjudication process. A complaint will be referred by a Consumer Commission for mediation, wherever scope for early settlement exists and parties agree for it. Mediation will be held in the Mediation Cells to be established under the aegis of the Consumer Commissions. There will be no appeal against settlement through mediation.

The New Act introduces the concept of product liability and brings within its scope, the product manufacturer, product service provider and product seller, for any claim for compensation.

The Act provides for punishment by a competent court for manufacture or sale of adulterant/spurious goods. The court may, in case of first conviction, suspend any licence issued to the person for a period of up to two years, and in case of second or subsequent conviction, cancel the licence.

The Central Consumer Protection Council Rules: It provides for constitution of the Central Consumer Protection Council, an advisory body on consumer issues, headed by the Union Minister of Consumer Affairs, Food and Public Distribution with the Minister of State as Vice Chairperson and 34 other members from different fields. The Council, which has a three-year tenure, will have Minister-in-charge of consumer affairs from two States from each region- North, South, East, West, and NER. There is also provision for having working groups from amongst the members for specific tasks.

It provides for the eligibility criteria for appointment of President and Members of the State Commission and the District Commission. For appointment as President of State Commission, a person should be or should have been a High Court judge. For appointment of member in State Commission, a person should have 10 years’ experience as presiding officer of a district court or of any tribunal at equivalent level or combined service as such in district court and tribunal or twenty years’ experience in consumer affairs, law, public affairs, administration, economics, etc. The minimum age for appointment as a member will be 40 years.

For appointment as president in the District Commission, a person should be or should have been or should be qualified to be, a District Judge. For appointment as a member in District Commission, the person should not be less than thirty-five years of age, have a bachelor’s degree from a recognised University and have not less than fifteen years’ experience in consumer affairs, law, public affairs, administration, economics, commerce, industry, finance, etc.

Appointment of president and members will be on the recommendations of the Selection Committee consisting of Chief Justice of the High Court or his nominee, Consumer Secretary and nominee of the Chief Secretary. The term of office of president and member would be four years or up to the age of sixty-five years, whichever is earlier.

As per these Rules there will be no fee for filing cases up to Rs 5 lakh. There are provisions for filing complaints electronically, credit of amount due to unidentifiable consumers to Consumer Welfare Fund (CWF). The State Commissions will furnish information to Central Government on a quarterly basis on vacancies, disposal & pendency of cases & other matters.

Each of the Consumer Commissions will have a Mediation Cellv headed by president. These Model Rules are to be adopted by the State Governments.

Join Whatsapp Channel of The Tribune for latest updates.