UNIT-5

The Consumer Protection Act, 2019

Consumer Protection Act, 2019:

The new Consumer Protection Act was passed by Parliament in 2019. It came into force in July 2020 and
replaced the Consumer Protection Act, 1986.
Consumer Protection Act, 2019 is a law to protect the interests of the consumers. This Act provides safety to
consumers regarding defective products, dissatisfactory services, and unfair trade practices.

Meaning of the word ‘consumer’:

Section 2(7) of the Consumer Protection Act, 2019 defines a consumer as any person who buys goods or
services in exchange for consideration and utilises such goods and services for personal use and for the
purpose of resale or commercial use.

Objective of the Consumer Protection Act, 2019:

Protect against the marketing of products that are hazardous to life and property.

Inform about the quality, potency, quantity, standard, purity, and price of goods to safeguard the consumers
against unfair trade practices.

Establish Consumer Protection Councils for protecting the rights and interests of the consumers.
Hear and ensure that consumers’ welfare will receive due consideration at appropriate forums in case any problem or dispute
arises.

Provide consumer education, so that the consumers are able to be aware of their rights.

Provide speedy and effective disposal of consumer complaints through alternate dispute resolution mechanisms.

What are consumer rights under Consumer Protection Act, 2019:

The rights of the consumers are mentioned under Section 2(9) of the Act, which are as follows:

The right of a consumer to be protected from the marketing of goods and services that are hazardous and detrimental to life and
property.

The right of a consumer to be protected against unfair trade practices by being aware of the quality, quantity, potency, purity,
standard and price of goods, products or services.

The right of a consumer to have access to a variety of goods, services and products at competitive prices.

The right to seek redressal at respective forums against unfair and restrictive trade practices.

The right to receive adequate compensation or consideration from respective consumer forums in case they have been wronged
by the seller.

The right to receive consumer education.

Unfair Trade Practice:

The Consumer Protection Bill, 2019 gives the power to the Central Consumer Protection Authority ("CCPA") to initiate
actions such as refund, recalls and returns.

Section 2(47) of the Consumer Protection Act, 2019 defines the term ‘unfair trade practices’ which include:

Manufacturing spurious goods or providing defective services.

Not issuing cash memos or bills for the goods purchased or services rendered.

Refusing to take back or withdraw the goods or services and not refunding the consideration taken for the purchase of the
goods or services.

Disclosing the personal information of the consumer.

Unfair Trade Practice means a trade practice which, for the purpose of promoting the sale, use or supply of any goods
or for the provision of any service adopts any unfair method or unfair or deceptive practice including any of the
following practices namely:

making any statement, whether orally or in writing or by visible representation including by means of electronic record,
which—

a) falsely represents that the goods are of a particular standard, quality, quantity, grade, composition, style or model;
b) falsely represents that the services are of a particular standard, quality or grade;
c) falsely represents any re-built, second-hand, renovated, reconditioned or old goods as new goods;
d) represents that the goods or services have sponsorship, approval, performance, characteristics, accessories, uses or
benefits which such goods or services do not have;
e) represents that the seller or the supplier has a sponsorship or approval or affiliation which such seller or supplier does
not have;
f) makes a false or misleading representation concerning the need for, or the usefulness of, any goods or services;
RESTRICTIVE TRADE PRACTICES:
The definition of restrictive trade practice is given under section 2(1) (nnn) of the Consumer Protection Act, 1986. It is
defined as a trade practice that has the capability to manipulate the price or conditions of delivery or to affect flow of
supplies in the market of goods and services and it will affect the consumer in terms of unjustified costs or restrictions.

Illustrations of Restrictive Trade Practices:

A trader accumulates his stock of food grains in order to increase the price of the grains in the market so that he can sell it
at a higher price.
In order to buy a television from trader X, one needs to buy a table first.

The Consumer Dispute Redressal Forum is a three tier system.

The three tier redressal methods in consumer awareness comprising National Consumer Redressal Forum (NCRF), State
commission and District forums.
DISTRICT CONSUMER FORUM

Introduction:

A district consumer forum, also known as the District Commission, is a consumer dispute redressal commission established by the
State Government, by a notification, in each district of the state, under the section 28(1) of the Consumer Protection Act, 2019.

These consumer forums are established with the purpose of protecting and enforcing the rights of the consumers and providing
them with an additional way, along with the action in civil courts, to seek redressal. These consumer forums are quasi-judicial
bodies, established by the act of the Parliament which run parallel to the civil courts.

Composition:

The District Forum would be composed of:

President—a person who is, or has been, or is qualified to be a District Judge,

Not less than two other members— one of the two members shall be a woman. The two members shall have the following
qualifications:
35 years of age is bare minimum;
having a bachelor’s degree from a university which is recognised;
have adequate knowledge and experience of at least 10 years of dealing problems related to economics, public affairs, industry,
commerce, accountancy, law or administration.
Jurisdiction:

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. If the Central Government feels necessary, it would provide
other values as it deems fit.

A complaint shall be instituted in a District Forum within the local limits of whose jurisdiction:

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 the
permission of the District Commission is given;

the cause of action, wholly or in part, arises; or

Residence or the workplace of the complainant.
Mere dealing with claim by some at Regional Office would not furnish part of cause of action.
In cases of vacancy, the State Government may extend the jurisdiction of a particular district commission, beyond that district
to the one with a vacancy.
The functions of the District Commission would be ordinarily performed at the headquarters or any other place as notified by
the State Government.
Powers:

The district commission has the power to entertain complaints and charge fee in relation to the goods sold or agreed to be
sold or the services provided or agreed to be provided by:

The consumer of such goods or services; or

Any recognised consumer association; or

One or more consumers in case where numerous consumers have the same interest; or

the Central Government, the Central Authority or the State Government, as the case may be.

In case of an allegation of a defect in a good which cannot be ascertained without a test or proper analysis of the
substance, the commission may obtain a sample of the goods from the complainant, seal it and provide it to the
appropriate laboratory for analysing or testing, as the case may be, for which a fee must be deposited by the complainant.
State Consumer Disputes Redressal Commission or State Commission

The State Commission is to be appointed by the State Government in consultation with the Centre. It has the same function as
state level. The state consumer protection council is also known as “Consumer Disputes Redressal Commission”.

Members:

Each State Commission shall consist of the following members.

1. A person who is or has been a Judge of a High Court appointed by the State Government as its President.

2. Two other members who shall be persons of ability, integrity and standing and have adequate knowledge or experience of or
have shown capacity in dealing with problems relating to economics, law, commerce, industry, public affairs or administration of
them, one shall be a woman.

Members should not less than 35 years of age.

Possess a bachelor’s degree from a recognized university.
Be persons of ability, integrity and standing, and have adequate knowledge and experience of at least ten years in dealing with
problems relating to economics, law, accountancy, commerce, public affairs, industry or administration.
Salary and Terms of Service:

The salary and other allowances payable to the members and their other terms of service, shall be such as may prescribed,
by the State Government.

Every member of the state shall hold the office for a tenure of 5 years or upto the age of 67 years, whichever is the earlier.

A member shall be eligible for re-appointment of another term of 5 years or upto the age of 67 years.

A member may resign his office in writing by addressing it to the State Government . His vacancy may be filled as per the
above mention procedure.

Jurisdiction:

The Jurisdiction of the State Commission is as follows.

The State Commission can entertain complaints within the territory of entire state and where the value of the goods or
services and the compensation, if any claimed exceed Rs. 20 lakhs and below Rupees One Crore.

The State Commission also has the jurisdiction to entertain appeals against the orders of any District Forum within the State.
Powers:

The following are the powers of the State Commission.

The State Commission also has the power to call for the records and pass appropriate orders in any consumer dispute which is
pending before or has been decided by any District Forum within the State.

To produce before and allow to be examined by an officer of any of these agencies, such books of accounts, documents or
commodities as may be required and to keep such books, documents, etc., under his custody for the purposes of the Act.

To furnish such information that may be required for the purposes of the Act to any officer so specified.

Appellate Forum:

The State Commission’s jurisdiction may be original, appellate or revision. The State Commission may reverse or confirm the
orders passed by the District Forum.

Any person aggrieved by an order of the State Commission may prefer an appeal to the National Commission within 30 days
from the date of such order.
The National Consumer Disputes Redressal Commission or the NCDRC :

The National Consumer Disputes Redressal Commission or the NCDRC is a quasi-judicial commission established as per the
provisions of the Consumer Protection Act, 1986.

It was established in 1988.

Its headquarters is in New Delhi.

The NCDRC is headed by a retired or a sitting judge of the Supreme Court.

The objective of the National Consumer Disputes Redressal Commission, as well as the respective state commissions and district
fora is to provide speedy, economical and summary resolution of consumer complaints or disputes.

The NCDRC is at the apex while it has 35 state commissions and 629 district fora under it.
NCDRC Jurisdiction

Section 21 of the Consumer Protection Act 1986 provides that the NCDRC can entertain consumer complaints that are valued over
Rs. 1 Crore. As per the 2019 Act that replaced the 1986 Act, the NCDRC will entertain complaints valued above Rs. 10 Crore.

Also, the Commission has appellate as well as revisional jurisdictions from the orders of the State Consumer Disputes Redressal
Commissions and the District Fora, as the case may be.

The Act also provides that any person who is aggrieved by an order of the NCDRC may appeal against the order in the Supreme
Court of the country within a period of 30 days.

The State commissions will entertain cases between Rs. 1 Crore and Rs. 10 Crore.

The District fora will look into cases up to Rs. 1 Crore.

Another change made in the 2019 Act is that the complainant can make the complaint in the place where he/she works or
resides rather than where the opposite party resides or conducts business, thereby, easing the burden on consumers.
Powers:

Adoption of uniform procedure in the hearing of the matters is followed in the National Commission

Prior service of copies of documents produced by one party to the opposite parties.

Speedy grant of copies of documents are issued by the National Commission.

Generally over-seeing the functioning of the State Commissions and the District Forums to ensure that the objects and
purposes of the Consumer Protection Act are best served, without interfering with their quasi-judicial freedom.

Appellate Forum:

Any consumer dispute which is pending before or has been decided by any State Commission where it appears to the National
Commission that such State Commission has exercised a jurisdiction not vested in it by law, or has failed to exercise a
jurisdiction so vested or has acted in the exercise of its jurisdiction illegally or with material irregularity.

Section 23 of Consumer Protection Act, 1986, provides that any person aggrieved by an order of National Commission may
prefer an Appeal against such order to Supreme Court of India within a period of 30 days.