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Consumer Protection Bill, 2019
  • By: Adv. Jayatinn B Laalwani
  • Date: 04 Oct 2019
  • Consumer Grivances
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On 30th July 2019, LokSabha passed the Consumer Protection Bill, 2019, which wholly replace the Consumer Protection Act, 1986. The bill was introduced by the Minister of Consumer Affairs, Food and Public Distribution in LokSabha to enact a new law for strengthening consumer rights in the modern market.  It proposes to set up a Consumer Disputes Redressal Commission and forums at District, State and National level for the speedy redressal of the Consumer Complaints.

Key provisions of Bill:

  1. The Consumer Protection Bill is enacted to protect the interest of consumers with the means of redressal mechanism that would lead to the effective and speedy settlement of disputes.
  2. It seeks to enlarge the scope of existing law to be more effective.
  3. It empowers the Central Consumer Protection Authority to protect the rights of the consumer and to solve issues related to misleading and false acts. 
  4. It has the provision of an alternative dispute resolution mechanism in the form of mediation.

The objective of the Consumer Protection Bill:
The main aim of the bill is to ease the process of addressing the grievances to the Consumer Forums and to protect and enhance consumer rights.

Central Consumer Protection Authority (CCPA) and its powers:
It is the National level regulator dealing the matters related to the violation of consumer rights, unfair trade practices and misleading advertisement that are prejudicial to the consumer’s interest.  It is an investigation wing with the power of search and seizure the consumer-related matters under the head of Director-General. The District Collector is empowered to report the Central Consumer Protection Authority if they receive the massive consumer complaints in the particular jurisdiction. CCPA has the power to file a complaint before the relevant Consumer Dispute Redressal Forum. It also has the power to recall the goods that are deemed to be hazardous or dangerous to the consumers and practising unfair trade practices. It can impose penalties on manufacturers and endorses for misleading advertisement.

Penalties
The CCPA has the power to impose a penalty up to Rs. 10 Lakh and imprisonment up to 2 years for the false and misleading advertisement. Whereas, in case of a subsequent offence, the fine may extend to Rs.50 lakh and imprisonment for five years.

CCPA has the power to prohibit the endorser for endorsing the misleading advertisement on particular product and services for one year. Further for a subsequent offence, the period of prohibition may extend to three years.

Pecuniary jurisdiction:
The Bill has enhanced the pecuniary jurisdiction as follows:
  1. The District Consumer Dispute Redressal Commission will entertain the complaints where the value of goods and services exceeds up to Rs. One Crore.
  2. The State Consumer Dispute Redressal Commission has the power to entertain the complaints where the value of goods and service are more than Rs. One crore but less than Rs. 10 Crore.
  3. The National Consumer Dispute Redressal Commission will entertain the complaints with the value of goods and services over Rs. 10 Crore.

E-Commerce: 
The Consumer Protection Act, 2019 refers to e-commerce as trading by using electronic technology, majorly internet services. As per the new Consumer Protection Act 2019, now all the rules applicable for direct selling will be extended to E-commerce. It will be liable to ensure that no counterfeits products are sold on the website.

Product Liability: 
The term product liability came into picture through the new Consumer Protection Act, 2019, as there was no specific statute dealing with the claims of product liability. Product liability is the liability of a service provider, the product manufacturer or seller who needs to compensate the consumer for any harm or injury caused by the defective product or services. The consumer has to prove any of the defect or deficiency in product to claim compensation.

  1. Product liability action for the manufacturer: The product should not contain the defect in its manufacturing, design, or there should not be any deviation from specifications in manufacturing the product. Also, the product should contain adequate instructions of usage to prevent any harm to the consumer. It should contain warnings regarding the improper usage of the product. Also, the warranty should be as per the standard rules and laws. 
  2. Product Liability for Service Provider: The liability for the service provider is that he should adequately monitor the quality or manner of performance as mandated under the law. Proper instructions and warnings must be issued by the service provider to prevent any harm.
  3. Product Liability for the seller: The product seller can alter or modify the product only to the extent until it is not harmful to the consumer. The seller of the product should ensure that the product or service is inspected properly before selling. He should provide adequate information to the consumers as described by the manufacturer.

Exceptions to product liability
The product manufacturer shall not be liable; 
  1. If he fails to instruct the consumer about the danger of a product which is expected to be commonly known to the user of the product. 
  2. If the consumer, while using the product, was under the influence of alcohol or any drug not prescribed by the medical practitioners, then the manufacturer is not liable for such product liability.
  3. For any harm, if the product is misused or altered.

Note: For earlier blog go on this link https://legatoapp.com/blog-in-detail.php?bp_id=65

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Consumer Protection Bill, 2019

By: Adv. Jayatinn B Laalwani Consumer Grivances 04 Oct 2019

On 30th July 2019, LokSabha passed the Consumer Protection Bill, 2019, which wholly replace the Consumer Protection Act, 1986. The bill was introduced by the Minister of Consumer Affairs, Food and Public Distribution in LokSabha to enact a new law for strengthening consumer rights in the modern market.  It proposes to set up a Consumer Disputes Redressal Commission and forums at District, State and National level for the speedy redressal of the Consumer Complaints.

Key provisions of Bill:

  1. The Consumer Protection Bill is enacted to protect the interest of consumers with the means of redressal mechanism that would lead to the effective and speedy settlement of disputes.
  2. It seeks to enlarge the scope of existing law to be more effective.
  3. It empowers the Central Consumer Protection Authority to protect the rights of the consumer and to solve issues related to misleading and false acts. 
  4. It has the provision of an alternative dispute resolution mechanism in the form of mediation.

The objective of the Consumer Protection Bill:
The main aim of the bill is to ease the process of addressing the grievances to the Consumer Forums and to protect and enhance consumer rights.

Central Consumer Protection Authority (CCPA) and its powers:
It is the National level regulator dealing the matters related to the violation of consumer rights, unfair trade practices and misleading advertisement that are prejudicial to the consumer’s interest.  It is an investigation wing with the power of search and seizure the consumer-related matters under the head of Director-General. The District Collector is empowered to report the Central Consumer Protection Authority if they receive the massive consumer complaints in the particular jurisdiction. CCPA has the power to file a complaint before the relevant Consumer Dispute Redressal Forum. It also has the power to recall the goods that are deemed to be hazardous or dangerous to the consumers and practising unfair trade practices. It can impose penalties on manufacturers and endorses for misleading advertisement.

Penalties
The CCPA has the power to impose a penalty up to Rs. 10 Lakh and imprisonment up to 2 years for the false and misleading advertisement. Whereas, in case of a subsequent offence, the fine may extend to Rs.50 lakh and imprisonment for five years.

CCPA has the power to prohibit the endorser for endorsing the misleading advertisement on particular product and services for one year. Further for a subsequent offence, the period of prohibition may extend to three years.

Pecuniary jurisdiction:
The Bill has enhanced the pecuniary jurisdiction as follows:
  1. The District Consumer Dispute Redressal Commission will entertain the complaints where the value of goods and services exceeds up to Rs. One Crore.
  2. The State Consumer Dispute Redressal Commission has the power to entertain the complaints where the value of goods and service are more than Rs. One crore but less than Rs. 10 Crore.
  3. The National Consumer Dispute Redressal Commission will entertain the complaints with the value of goods and services over Rs. 10 Crore.

E-Commerce: 
The Consumer Protection Act, 2019 refers to e-commerce as trading by using electronic technology, majorly internet services. As per the new Consumer Protection Act 2019, now all the rules applicable for direct selling will be extended to E-commerce. It will be liable to ensure that no counterfeits products are sold on the website.

Product Liability: 
The term product liability came into picture through the new Consumer Protection Act, 2019, as there was no specific statute dealing with the claims of product liability. Product liability is the liability of a service provider, the product manufacturer or seller who needs to compensate the consumer for any harm or injury caused by the defective product or services. The consumer has to prove any of the defect or deficiency in product to claim compensation.

  1. Product liability action for the manufacturer: The product should not contain the defect in its manufacturing, design, or there should not be any deviation from specifications in manufacturing the product. Also, the product should contain adequate instructions of usage to prevent any harm to the consumer. It should contain warnings regarding the improper usage of the product. Also, the warranty should be as per the standard rules and laws. 
  2. Product Liability for Service Provider: The liability for the service provider is that he should adequately monitor the quality or manner of performance as mandated under the law. Proper instructions and warnings must be issued by the service provider to prevent any harm.
  3. Product Liability for the seller: The product seller can alter or modify the product only to the extent until it is not harmful to the consumer. The seller of the product should ensure that the product or service is inspected properly before selling. He should provide adequate information to the consumers as described by the manufacturer.

Exceptions to product liability
The product manufacturer shall not be liable; 
  1. If he fails to instruct the consumer about the danger of a product which is expected to be commonly known to the user of the product. 
  2. If the consumer, while using the product, was under the influence of alcohol or any drug not prescribed by the medical practitioners, then the manufacturer is not liable for such product liability.
  3. For any harm, if the product is misused or altered.

Note: For earlier blog go on this link https://legatoapp.com/blog-in-detail.php?bp_id=65
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Consumer Protection ACT, 1986

By: admin Consumer Grivances 30 Jul 2019

The enforcement of the Consumer Protection Act, 1986 is one of the most critical breakthroughs in the sphere of the consumer protection movement in India. It was a continuous and comprehensive piece of legislation of its time, covering all goods and services. The Act ensures the rights of the consumer and provides for a simple, speedy and inexpensive redressal to the consumers and also award compensation, wherever appropriate, to the consumer. An exclusive three-tier redressal system as an alternative to the civil court has been inculcated under the Act, wherein an aggrieved consumer can seek redressal against any defects in the goods purchased or deficiencies in services availed. It also includes restricting unfair trade practices if adopted by the trader of goods or the service provider. In the last thirty years, more than 4.3 million consumer cases were adjudicated and decided by the consumer forum.

Laws Protecting Consumers Under Different Regulations:

1. The Bureau of Indian Standards Act (2016) establishes the Bureau as the National Standards Body of India. Besides containing provisions for establishing voluntary standards, the Act also contains provisions to make compulsory certification regime of any article, process or service which it considers necessary from health, safety, environment, prevention of false practices, security etc. Several enabling provisions have also been made for hallmarking of the precious metal articles as mandatory. This Act allows multiple types of conformity assessment schemes, including Self Declaration of Conformity against any standard which provides simplified options to manufacturers to adhere to the standards and get a certificate of conformity. It authorises the Central Government to appoint any authority, in addition to the BIS, to verify the compliance of products and services to a standard and issue certificate of conformity.

2. The Legal Metrology Act 2009: The Act has come into force on 01.04.2011 and has repealed the Standards of Weights & Measures Act, 1976 & Standards of Weights & Measures (Enforcement) Act, 1985. The Act ensures that all weight and measure used for trade or commerce or protection of human health and safety are accurate and secure so that users are guaranteed for correct Weighing and Measurement. The Act also empowers regulatory and enforcement actions for ensuring that the consumer gets the right quantity for which he has paid for.

3. The Essential Commodities Act 1955: The Act empowers the Government to regulate prices, production, supply, distribution etc. of essential commodities for maintaining or increasing their supplies and for securing their equitable distribution and availability at fair prices. Most of the powers under the Act have been delegated by the Central Government to the State Governments in the direction that they shall exercise these powers. Exercising powers under the Act, various Ministries/Departments of the Central Government and State Governments/UT Administrations have issued Control Orders for regulating the production, distribution, pricing etc. and trading of the commodities declared as essential to the public. At present, seven commodities have been retained under the Essential Commodities Act, 1955 to protect the interests of the consumers, which include farmers, general population and the families below the poverty line.

4. Food Safety and Standards Act, 2006 (FSS): It envisages regulation relating to the manufacture, distribution, storage, sale and the import of food articles to ensure availability of safe and wholesome food for human consumption and consumers connected in addition to that. Authority by name Food Safety and Standards Authority of India (FSSAI) has been established under this Act for laying down scientific standards for foods articles. This Act was operational read with the notification of Food Safety and Standards Rules, 2011 and six Regulations w.e.f the 5 August 2011. The setting of food standards is undertaken through several Scientific Panels and the Scientific Committee of the FSSAI and final approval by the Authority.

5. The Contract Act, 1872 binds people on their promises, which are reduced to writing in a contract. In case of breach of contract, the Act also provides remedies available to parties.

6. The Sale of Goods Act, 1930: It provides for the safeguard and relief to customers in case goods not complying with the expressed conditions and warranty.

7. The Competition Act, 2002, governs Indian competition law. It succeeded in the Monopolies and Restrictive Trade Practices Act, 1969. This Act established the Competition Commission of India to prevent the activities that have an adverse effect on competition in India. It acts as a tool to implement and enforce competition policy and to prevent and punish anti-competitive business methods by firms and unnecessary Government interference in the market. Competition law is equally applicable to writing as well as oral agreement, arrangements between the enterprises or persons.

8. The Drugs and Magic Remedies (Objectionable Advertisements) Act introduced in 1954: This Act controls the drugs-related advertisement in India by prohibiting the advertisements of drugs and remedies that claim to have magical traits and declares it as a cognizable offence. The Act further defines "magic remedy" as any talisman, amulet, mantra, or any other object, which is alleged to have miraculous powers to cure, diagnose, prevent or mitigate disease/illness. It also includes such devices that have the power to influence the structure or the function of an organ in humans or animals. It prohibits advertisements of drugs and remedies have magical properties and makes doing so a cognizable offence.

9. The Drugs and Cosmetics Act of 1940 governs the import, manufacture, and distribution of drugs in India. The primary aim of this act is to ensure that the drugs and cosmetics are safe for sale in India, and are effective as well as confirm the state quality standards. The Drugs and Cosmetics Rules, 1945 framed under the Act contain provisions for the different classes of drugs under given schedules, and also lays the guidelines for the storage, sale, display, and prescription of each schedule. It also defines the standards of quality for drugs and defines the term "misbranding". The drug is considered misbranded if it claims to be of more curative/therapeutic value than it is actually. Several times the manufacturer of such a drug may be asked to suspend manufacturing of the drug. The Act also deals with fake and adulterated drugs.

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Rights of Consumers

By: Adv. Jayatinn B. Lalwani Consumer Grivances 12 Sep 2019

A consumer is considered the real king of the market. The consumer is the one who buys the products for consumption and not for resale or any other commercial purpose. He pays some amount of money to avail these goods and services offered to him. 

A Consumer plays a crucial role in changing the market. If there is no consumer, the manufacturer will have no one to provide its services. More often, the consumer is offered contaminated food or uncertified products. 

Being an important participant in the market, the rights of the consumer must be protected. Until the commencement of the Consumer Protection Act, 1986, India was severely affected by black marketing, food adulteration, inadequate weighing, etc., which affected the well-being of the consumers in the Indian market. Due to these malpractices, the government decided to enact the Consumer Protection Act on 24th December 1986. The main objective of the act was to protect the rights of the consumer.

There are six primary consumer rights defined as per the Consumer Protection Act, 1986:

Right to Safety: The Consumer Protection Act defines this right as protection against goods and services that are ‘dangerous to life and property’. It applies to medicines, pharmaceuticals, foodstuffs, and automobiles. The Right to safety says that all such products of critical nature to life and property should be carefully tested and validated before being marketed to the consumer. The goods and services purchased by the consumer should not only meet the immediate needs but also fulfil the interests for the long term goal. It is suggested to choose the product holding quality mark.

Right to Information: Right to information says that the consumers have the right to be informed about the quality and quantity of goods sold. They must have the information about the price of product and access to other information about the product that consumer intends to buy. A consumer should get all the information about the goods and services before making a choice. The consumer may now seek the information of the product by filing the complaint under Right to Information Act, 2005 before the appropriate authority.

Right to Choose: The consumer must have the right of choosing the products at competitive prices. Thus, the concept of a competitive market explains that there are many sellers to sell similar products, but it’s the consumer right to choose what they intend to consume and in what quantity. This is done to avoid a monopoly in the market. It also includes the right to choose the basic goods and services. 

Right to Seek Redressal: When a consumer is exploited, he/she have the right to file a complaint against the faulty product and approach a consumer court. A consumer court is a forum that hears the criticism and provides justice to the exploited parties. The consumer has the right to be represented in various forums formed for the welfare of the consumer. The Consumer Protection Act defines the three-tier redressal system to execute the right of redressal.

Right to be Heard: The right to heard ensures that if the consumers are dissatisfied with the product purchased, then they can be heard in consumer redressal forums. When a consumer feels exploited, he has the right to approach a consumer court to file his complaint. This right respect the claim made by the consumer and will be duly heard. The said complaint cannot go unheard as it must be addressed within the appropriate time frame. The right to be heard empower consumers to voice their concerns fearlessly and seek justice if exploited.

Right to Consumer Education: Consumers have the right to know all information and should be aware of their rights and responsibilities. Lack of awareness is the major problem in our country, which results in the exploitation of Consumer rights. This information can help them to choose what to purchase, how much to buy and at what price. Consumers are not even aware of the acts protecting them. Unless they are aware of the right, they cannot seek justice when exploited. 

Also, in addition to the above mentioned six consumer rights, there are also a few other consumer rights.

Right to file a complaint: The consumers can file a complaint with the District Consumer Commission or State Consumer Commission directly as the Consumer affairs are now framing rules for electronic filing of complaints and payment of fees digitally.

Right to seek compensation: The complainant can now file a case against the manufacturer or seller of a particular product for any loss occurred. This new provision brings e-commerce under the ambit of consumer laws.

Right to seek hearing via video conference: As per the new act of consumer protection, if any of the consumer forwards the application for being present for hearing through video conference, the commission can allow the same.

Right to know the reason for rejection of complaint: No complaint can be rejected by the commission, in fact, as per the act, the commission must decide to admit or reject a complaint within 21 days of the filing of the complaint.

Right to protect the consumer as a class: The complaint which relates to the violation of consumer rights, unfair trade practices or misleading advertisement which are prejudicial to the interest of the consumer as a class, the complaint can be filed before the district collector, commissioner of regional office or the authority of Central Consumer for a class action.

Conclusion: The Consumer Protection Act, 1986 was enacted in order to protect the rights of the consumer on 24th December 1986. Now, in 2019, this three-decade-old Consumer Protection Act is repealed by new Consumer Protection Act, 2019 in order to enhance consumer rights in the digital economy and expand the scope of consumer grievances with easy process of filing complaints.

The existing legal framework of Consumer protection Act failed to address the emerging issues and new modes of business like telemarketing, multi-level marketing, e- commerce, etc. there was a dire need of a  legal framework that gives the regulatorsuo-moto powers.

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