The Consumer Protection Act (CPA), 2019, which has replaced old Consumer Protection Act 1986 has came into force w.e.f. July 20, 2020 aiming to enforce and protect the rights of consumers, and provide an effective mechanism to address consumer grievances. The act was briefed by Union Minister for Consumer Affairs, Food & Public Distribution Ram Vilas Paswan through video conference with media.
- Notably, the rules for prevention of unfair trade practice by e-commerce platforms will also be covered under this Act.
- The rules for this new act will be finalized after the meeting of former Secretaries of the Consumer Affairs Department and Members of Parliament which will be held this month.
Punishment for manufacture or sale of products containing adulterant / spurious goods
A product manufacturer and seller will be liable to provide compensation for injury or damage caused by a defective product or service.
- 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.
- A product manufacturer and seller will be penalized with up to 6 months in jail or a fine of up to Rs 1 lakh if the consumers do not suffer any injuries.
- In cases where the consumer is injured, the fine to the manufacturer, seller or distributor could go up to Rs 5 lakh and up to seven years in jail.
- In case of death of the consumer, the culprit will have to pay a minimum fine of Rs 10 lakh and spend seven years in jail, which can be extended to life imprisonment.
Establishment of Central Consumer Protection Authority (CCPA)
The Act proposes the establishment of a Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers, and make interventions in situations of unfair trade practices.
- CCPA will be empowered to conduct investigations into violations of consumer rights and institute complaints / 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
Rules for e-commerce
Every e-commerce entity is 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. including country of origin which are necessary for enabling the consumer to make an informed decision at the pre-purchase stage on its platform.
- E-commerce platforms have to acknowledge the receipt of any consumer complaint within 48 hours and redress the complaint within one month from the date of receipt under this Act.
Simplified dispute resolution mechanism
The Act provides for a simplified dispute resolution mechanism, with a provision for mediation and e-filing of cases. The consumers are provided with a three-tier consumer dispute redressal machinery at the National (NCDRC), State (State Commissions) and District levels ( District Fora)
- It also enables 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.
- There will be no fee for filing cases upto Rs 5 lakh as per Consumer Disputes Redressal Commission Rules.
- There is provision to credit the amount due to unidentifiable consumers to Consumer Welfare Fund (CWF).
The Consumer Protection Bill, 2019 was introduced in the Upper House of Parliament by the Minister of Consumer Affairs, Food and Public Distribution, Ram Vilas Paswan, on July 8, 2019. It was passed by the Lok Sabha on July 30, 2019 and Rajya Sabha on August 6, 2019. The Bill was then signed into law by President Ram Nath Kovind on August 9, 2019.