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  • New Consumer Protection Bill 2018 Will Entail More Punishment

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New Consumer Protection Bill 2018 Will Entail More Punishment

Courtesy/By: SANJEEV SIROHI  |  10 Feb 2018     Views:1603

 Introduction

                                               Coming straight to the crux of the matter, let me begin first and foremost pointing out that a new Consumer Protection Bill has been tabled in the Lok Sabha on January 5, 2018. This was presented on the last day of the winter session of Parliament. The Union Minister for Consumer Affairs – Ram Vilas Paswan introduced the new Consumer Protection Bill, 2018 in the Lok Sabha.

                   Replacing Old Act By New

                                       Needless to say, if all goes well, the Bill will certainly become an Act sooner than later. It will replace the Consumer Protection Act, 1986. The Consumer Protection Bill, 2018 is more wider in its ambit as compared to the Act of 1986.

                            Object Of New Bill

                                      This new Consumer Protection Bill, 2018 seeks to enforce stringent provisions in order to protect consumers by regulating online sales, providing for higher manufacturer liabilities, even restricting tall claims, including some made through celebrity brand endorsers. It thus legislates on at least three new areas vis-à-vis the older law. It seeks to set up an authority to safeguard consumer rights in view of current challenges posed by e-commerce, direct selling, tele-marketing and misleading ads, among others.

                         Wider Scope

                                    As it turns out, the new law will apply to all goods and services, including sale/construction of homes/flats and telecom services. It brings within its fold all forms of selling – offline/online sales, teleshopping, direct selling and multi-level marketing. In other words, this new law envisages wider application covering all goods, services and selling.

                                         Truth be told, while the earlier law did cover unfair trade practices, the current one certainly seeks to make it more comprehensive. It adds practices such as failure to issue a bill or a receipt, refusal to accept a good returned or refusal to discontinue service within 30 days (if it is so stipulated and requested by the consumer) and disclosure of personal information given in confidence, to the list of unfair practices. It also defines unfair contracts. Issues such as excessive security deposit requirements, penalty for breach of contract which is disproportionate to the loss incurred and refusal to accept early repayment of debt on payment of applicable penalty will now fall squarely under its ambit.

                        Product Liability

                                  It must be reiterated here that the highlight of the new law is the inclusion of the product liability action. Thus, we see that when any one of us suffer any harm due to a defect in a product made by the manufacturer, serviced by a service provider or sold by a product seller, earlier there was no fixed liability but now we have a right to claim compensation once the 2018 Bill becomes a law. The 2018 Bill further lays down the appropriate circumstances under which the manufacturer, service provider and seller will be held liable.

                        Conditions For Liability

                                      As for instance, we see now that a product manufacturer will be liable to compensate for harm caused to the consumer under any one of the following conditions. Those conditions are as follows: -

  1. The product contains a manufacturing defect;
  2. It is defective in design;
  3. There is a deviation from the manufacturing specifications;
  4. It does not conform to the express warranty; and
  5. It does not contain adequate instructions for correct usage.

                    Regulator On Anvil

                                    It is well known that to promote and protect the consumer rights, the Consumer Protection Councils at the district, state and national levels are prescribed under the current law. But its biggest handicap is that it is only an advisory body and hence does not have powers of enforcement. To overcome this handicap, this new Bill brings in a regulator for consumer affairs, much like the Securities and Exchange Board of India  (SEBI) for the markets or the Insurance Regulatory and Development Authority of India (IRDAI) for insurers.

                                      To be called the Consumer Protection Authority, the new regulator will be a central authority with offices at the regional level. The new Consumer Protection Authority will have power to monitor and enforce the new regulatory regime that the Bill seeks to implement. The Bill says very specifically that, “This fills an institutional void in the regulatory regime extant. Currently, the task of prevention of or acting against unfair trade practices is not vested in any authority.”

                                      To be sure, this Authority will have the requisite powers to inquire and investigate into complaints and initiate prosecution. It will also be empowered to issue safety notices/pass orders in relation to matters such as recall of goods, reimbursements of the amount paid by consumers, misleading advertisements and unfair trade practices/contracts. This would ensure that consumer protection law is not blatantly violated with impunity as this Consumer Protection Authority would check this and act as a powerful deterrent.

    Consumer Disputes Redressal Commission (CDRC)

                                 It must be added here that the CDRCs will be set up at the district, state and national levels. A consumer can file a complaint with CDRCs in relation to:

(i)                         unfair or restrictive trade practices;

(ii)                      defective goods or services;

(iii)                   overcharging or deceptive charging; and

(iv)                   the offering of goods or services for sale which may be hazardous to life and safety.

Complaints against an unfair contract can be filed with only the State and National CDRCs. Appeals from a District CDRC will be heard by the State CDRC. Appeals from the State CDRC will be heard by the National CDRC. The final appeal will lie before the Supreme Court.  

         Jurisdiction Of CDRCs

                           To tell the truth, the District CDRC will entertain complaints where value of goods and services does not exceed Rs one crore. The State CDRC will entertain complaints when the value is more than Rs one crore but does not exceed Rs 10 crore. Finally, the complaints with value of foods and services over Rs 10 crore will be entertained by the National CDRC.

        Punishment For Non-Compliance  

                                        To put things in perspective, the non-compliance of the order issued by the Consumer Protection Authority is punishable with am imprisonment of up to six months or a fine of up to Rs 20 lakh, or both. The Authority may also impose penalties with regard to the misleading advertisements, food adulteration and spurious goods. A penalty on the endorser of the misleading advertisement is suggested as well, which could put celebrities who endorse products that don’t live up to its claims, in the dock.

Punishment For False Claims In Advertisements  

                                       It must be highlighted here that misleading ads in various media touting exaggerated claims are very common and it is the consumers who have to suffer the most because of all this! Earlier there was a lack of clear legal provisions. But this new Consumer Bill of 2018 seeks to specify what constitutes false and unfulfilled claims.

                                      This proposed new Consumer Protection Bill of 2018 imposes a jail term of up to two years and Rs 10 lakh as fine for manufacturers making false and misleading claims in advertisements. This could go up to five years in jail and Rs 50 lakh fine for repeat offenders. Very rightly so!

                                         It is noteworthy that endorsers making such claims will face a penalty of up to Rs 10 lakh and a ban of a year from making endorsements. The repeated offenders would attract fines of up to Rs 50 lakh and a ban of up to three years. In fact the jail term for such repeated offenders must not be less than 5 years. But what an unbeatable irony that for repeated offenders no jail term is prescribed. This again must be set right!

                                       Not just this, the repeated offenders must be barred permanently from making endorsements but this has not been done till now. It must be done before it becomes a law so that it acts as an adequate deterrent for repeated offenders. It is quite baffling that why this has not been done. 

                 Defence For Endorsers   

                                    According to the Bill, the endorsers who can prove that they applied “due diligence” or appeared in an ad in “normal course of business” without knowledge of fraudulent intentions may use it as a “defence”. They have every right to stand immune from legal proceedings if they can prove that they had no fraudulent intentions of any kind while endorsing. No one can deny or dispute this! However, the Bill in the same vein also states that, “The burden of proof of such defence shall lie on the person raising such defence”.

               Vulnerability Of Consumers

                                 The Bill says that growth in e-commerce, international trade and newer services as well as innovative delivery chains have increased the choice before consumers but also made them vulnerable. So consumers have to be protected from becoming a vulnerable target who are liable to be exploited most easily!      

                                 Truly speaking, the Bill also states that, “The modern market place contains a plethora of products and services. The emergence of global supply chains, rise in international trade and the rapid development of e-commerce have led to new delivery systems for goods and services and have provided new options and opportunities for consumers. Equally, this has rendered the consumer vulnerable to new forms of unfair trade and unethical business practices.”

        Curbing The Misuse Of Limitation

                                          Unfair trade practices often take advantage of limitations in the current law. This must be plugged in the new Bill. If this is not done, the whole purpose of the new Bill will stand defeated. Pradeep Mehta of the CUTS International which is a consumer rights activist group points out that, “In an earlier era, issues like misleading ads and cheating were dealt with under the Monopolistic and Restrictive Trade Practices (MRTP) Act. But since the Competition Act, 2002, replaced the MRTP Act, it left out effective regulations to deal with unfair trade practices. This new Bill hopefully will address these shortcomings.” The Bill also provides for framing of rules subsequent to passage of the Bill for product recalls and on the responsibility of a firm for both safety and efficacy of its products.

                        Mediation Cells

                          Presently, a Redressal Commission operates at the district, state and national levels to adjudicate consumer disputes. The new law stipulates for an alternative dispute redressal mechanism if there is chance for a settlement agreeable to the parties to the dispute. The new Bill calls for setting up of mediation cells attached to the district, state and national commissions.

                               Conclusion

                                  All said and done, this new Bill is certainly a marked improvement over the previous one. But still many more loopholes can and must be plugged before finally getting it assented to by the President. It certainly merits more deliberation in both Houses of Parliament. Only after a proper debate, discussion and deliberations by both Houses of Parliament should it be passed after going through it in detail so that no loophole is left out. This new Bill directly affects consumers in a huge way and so has to be taken most seriously so that consumers don’t suffer under any circumstances and have enough remedy to pursue when aggrieved which can be possible only if all their genuine concerns are taken into board and simultaneously also addressed before making it into a law by getting it passed in both Houses of Parliament!


Courtesy/By: SANJEEV SIROHI  |  10 Feb 2018     Views:1603

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Victim Has A Right To Assist The Court In A Trial ...
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Study of Lakes to be Conducted by NEERI...
07 Aug 2019     Views:1802
SC Denies Permission to Conduct DNA Tests...
07 Aug 2019     Views:1704
Whatsapp's fight against interference with User-Pr...
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Evidence Of A Solitary Witness In A Criminal Trial...
07 Aug 2019     Views:1573
High Court of Karnataka set aside the retirement o...
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Study of Lakes to be Conducted by NEERI...
06 Aug 2019     Views:1677
History-sheeter kidnaps and rapes a College Studen...
06 Aug 2019     Views:1741
No Room For Sympathy While Sentencing Terror Convi...
06 Aug 2019     Views:1701
Rejected Plea: Declaration of Vande Mataram as Nat...
05 Aug 2019     Views:1926
Madras HC corrects the computation error of Motor ...
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Fundamental Right To Privacy Not Absolute And Must...
05 Aug 2019     Views:1747
Diocese of Tanjore Society School gets relief from...
04 Aug 2019     Views:1710
THE TEMPLES IN KARNATAKA NO MORE BE GOVERNED UNDER...
03 Aug 2019     Views:1781
Triple Talaq legislation is challenged in the Delh...
03 Aug 2019     Views:1493
Special Olympics International Football Championsh...
03 Aug 2019     Views:1409
Concession to be given to disabled persons appeari...
03 Aug 2019     Views:2066
Bombay High Court Hears Dowry Case Involving A Civ...
03 Aug 2019     Views:1813
Karnataka High Court on the condition of Roads...
02 Aug 2019     Views:2076
SC ORDERS DEATH PENALTY IN COIMBATORE GANG-RAPE CA...
02 Aug 2019     Views:1608
RBI Changes Features Of New Currency Notes. Bombay...
02 Aug 2019     Views:1462
Interest Of Victim And Society At Large Must Also ...
02 Aug 2019     Views:1494
Abolition of Colonial Decorum in Courts...
01 Aug 2019     Views:5762
Punjab & Haryana HC Bans Use Of Loudspeakers Witho...
31 Jul 2019     Views:2322
ICJ Has Rightly Called Pakistan’s Bluff In Jadha...
26 Jul 2019     Views:1517
Review And Reconsider Conviction And Sentencing Of...
22 Jul 2019     Views:1558
Plaintiff Cannot Be Forced To Add Parties Against ...
21 Jul 2019     Views:1771
Biggest Slap By ICJ Directly Right On The Face Of ...
19 Jul 2019     Views:1474
Delhi HC Imposes Rs. 50,000 Cost On Woman For Fals...
17 Jul 2019     Views:1503
Non-Appointment Of Judges Affects Speedy Justice: ...
16 Jul 2019     Views:1427
Right To Get Anticipatory Bail Is Not Any Fundamen...
14 Jul 2019     Views:1794
Plea For Anticipatory Bail Not Maintainable Before...
13 Jul 2019     Views:1947
Divorce Cannot Be Granted Only On Ground Of Irretr...
11 Jul 2019     Views:1444
Right To Shelter A Fundamental Right; State Has Co...
08 Jul 2019     Views:1571
HC Cannot Reverse Acquittal Without Affording Oppo...
06 Jul 2019     Views:1330
Centre Is Legally Empowered To Create A High Court...
05 Jul 2019     Views:2024
Centre Must Now Immediately Order Creation Of HC B...
03 Jul 2019     Views:1390
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How To Record The Evidence Of Deaf And Dumb Rape V...
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Ban Advocates From Carrying Weapons Inside Court P...
26 Jun 2019     Views:2750
Enact Strict Law To Ensure Personal Safety Of Doct...
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Mere Aggressive Behaviour Of Wife Not A Ground Of ...
26 Jun 2019     Views:2870
Court Cannot Destroy Faith & Beliefs Of People: Ma...
07 Jun 2019     Views:1366
Insult Of Soldier In Name Of Law Is Most Disgracef...
07 Jun 2019     Views:1674
Courts Cannot Decide Eligibility And Essential Qua...
20 May 2019     Views:4954
SC Upholds Constitutionality Of Section 23 Of PCPN...
20 May 2019     Views:2742
My Unflinching Faith In CJI Stands Fully Vindicate...
20 May 2019     Views:1892
Solitary Confinement Of Death Convict Prior To Rej...
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Section 498A & 306 IPC: Incidents Which Happened M...
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“Drop This Episode From Your Minds And Gossips...
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Is The Criticism Of In-House Procedure Justified?...
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Delhi High Court Directs Government To Set Up 18 F...
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18 May 2019     Views:1392
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Lawyers Resort To Seek Unnecessary Adjournments Am...
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Magistrate Shall Specify Whether Sentences Awarded...
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Mere Inability To Repay Loan Does Not Constitute C...
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Inability To Establish Motive In A Case Of Circums...
23 Feb 2019     Views:2863
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Long Pendency Amounts To A Special Reason For Impo...
23 Feb 2019     Views:1654
Successive Applications For Recalling Witnesses Sh...
23 Feb 2019     Views:3233
Lieutenant General (Rtd) Cannot Be Tried In A Gene...
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Autonomy Of the Bar Cannot Be Taken Over By The Co...
05 Feb 2019     Views:3221
Casual Act Of Possession Over Property Does Not Co...
04 Feb 2019     Views:2461
No Authority Can Claim Privilege Not To Comply Wit...
04 Feb 2019     Views:2709
Death Sentence Only When The Alternative Option Is...
04 Feb 2019     Views:2783
SC Imposes Rs 5 Crore Penalty On A Medical College...
28 Jan 2019     Views:2054
A Judicial Officer Is Not An Ordinary Government S...
25 Jan 2019     Views:2173
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23 Jan 2019     Views:2221
Mere Allegations Of Harassment Without Proximate P...
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Legal Article Why Should They Speak Lies: Decease...
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Mutual Consent Divorce Procedure in Chennai Family...
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Quick Divorce in India...
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4 Important things to file Divorce in Chennai...
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Offences Under Section 307 IPC Can’t Be Quashed ...
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26 Nov 2018     Views:2433
SLP Against Death Sentence Shall Not Be Dismissed ...
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Sexual Offenders Registry For Law Enforcement Agen...
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Men Too Have Right Not To Be Defamed And Denounced...
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Legal Article Now Bar Council ID Card Is Valid Id...
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Devotion Cannot Be Subjected To Gender Discriminat...
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There Cannot Be Any Mechanical Denial Of Appointme...
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Rights Of Accused Far Outweigh That Of Victims, Ne...
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Extra-Judicial Confession Of Accused Need Not In A...
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Mirchpur Dalit Killings: “Atrocities Against SCs...
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People Without A Degree Performing Surgeries: Utta...
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MP HC To Debar Members/Office Bearers Of Bar Counc...
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Special Squad, Police Patrolling Every 24 Hours To...
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NRC Being Prepared Under Supreme Court’s Watch I...
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Delhi HC Strikes Down Provisions In Law That Crimi...
13 Aug 2018     Views:2156
Delhi HC Quashes Govt Notification Revising Minimu...
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Poorest Of Poor Cannot Go To Private Hospitals: Ut...
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How Long Will Lawyers Of West UP Just Keep Strikin...
04 Aug 2018     Views:2400
Courts Must See That The Public Doesn’t Lose Con...
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UK Tier 1 Entrepreneur Visa: Overview from Experts...
31 Jul 2018     Views:1993
Enact Law For Safety Of Soldiers Of Jammu And Kash...
23 Jul 2018     Views:1864
SC Advocates Creating A Special Law Against Lynchi...
23 Jul 2018     Views:3237
Matrimonial Discord Can’t Be Considered As Reaso...
23 Jul 2018     Views:3230
Uttarakhand HC Recommends Govt To Enact Legislatio...
23 Jul 2018     Views:3083
High Court Priests Cannot Refuse To Perform Religi...
23 Jul 2018     Views:2352
Uttarakhand High Court Passes String Of Directions...
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SC Finally Decides Master Of Roster Case...
23 Jul 2018     Views:1640
Stone Pelters And Terrorists Have No Right To Life...
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Remove Designations Like Police, HC, Journalist, A...
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Why Centre is Providing Security For Separatists B...
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Farmer Suicide Due To Bankruptcy Or Indebtedness: ...
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Every Indian Should Salute Brave Soldier Aurangzeb...
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Uttarakhand HC Issues Directions To Curb Drug Pedd...
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Have A Functional National Law University Within 3...
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Establish Regional Bench Of AFT In The State Withi...
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Cancel Licences of Drivers Using Cell Phones; Helm...
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Uttarakhand High Court Puts Restrictions On Noise ...
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Supreme Court To Look Into Validity Of Amended Law...
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29 Jun 2018     Views:2706
No Politics Please Over Plan To Assassinate PM Mod...
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Free Mentally Ill Children And Formulate Policies ...
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Landmark Ruling By Uttarakhand HC On Solitary Conf...
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Right Of Adult Couple To Live Together Without Mar...
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Why BJP Will Be Wiped Out In West UP And UP?...
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Why UP Has Just One High Court Bench And West UP N...
05 Jun 2018     Views:1835
Women Governed By Muslim Personal Law Can Invoke P...
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Why Is BJP Not Creating More Benches In UP?...
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Probation Period To Count For New Civil Servants B...
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SC Women Lawyers Association Seeks Chemical Castra...
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SC Finally Steps In To Expedite POCSO Cases...
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UP Former CMs Can’t Stay In Govt Bungalows: SC...
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Make BCCI A Public Body: Law Panel...
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Self-Styled Godman Asaram Awarded Life Until Death...
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A High Court Bench For West UP In Meerut Is Impera...
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People Of Karnataka Should Worship Congress...
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Delhi HC Upholds Life Term To Seven Policemen...
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Finance Act-2018 And Customs Act-1962 (Amendments)...
28 Feb 2018     Views:1788
Why No Death Or Life Term For Corruption?...
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Will Electoral Bonds Usher In Transparency?...
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How Long Will Lawyers Of West UP Keep Striking?...
19 Feb 2018     Views:1653
Finance Act 2018 and Customs Act 1962...
18 Feb 2018     Views:2127
Why Has Stone Pelting Been Legalised In Kashmir?...
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Shopian Firing: Major's Dad Moving SC For Quashing...
12 Feb 2018     Views:1604
Soldiers Have Every Legal Right To Kill Stone Pelt...
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Attack On Lawyers: Delhi HC Issues Notice To Delhi...
10 Feb 2018     Views:1574
Female Foeticide Must Be Punished Most Strictly...
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Soldiers Have Every Legal Right To Act In Self Def...
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New Consumer Protection Bill 2018 Will Entail More...
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CJI Brings Out A Roster To Allot Cases...
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Five Year Jail Term For Lalu In Third Fodder Scam ...
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SC Quashes All The 88 Mining Leases In Goa...
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Prevention Of Money Laundering Act -2002 (PMLA-20...
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Prevention Of Money Laundering Act-2002 Amended ...
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Prevention Of Money Laundering Act-2002 PMLA...
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Right to Know...
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A STUDY OF CERTAIN DEDUCTIONS ON INCOME TAX RELATI...
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Enviornment protection is for saving universe...
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RIGHT TO PRIVACY AND STATUS OF SECTION 377, IPC, 1...
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