Consumer Protection Act, 2019 – What is in this new law?

Consumer Protection Act, 2019 – What is in this new law?
Posted on 10-06-2022

From 20 July 2020, the Consumer Protection Act, 2019 (New Consumer Protection Act 2019)  has come into effect across the country. It may be noted that this Act has replaced the Consumer Protection Act, of 1986.

Why did the need arise to replace the old Act?

In fact, the new Act i.e. Consumer Protection Act, 2019 will be able to act faster and in less time than the old Consumer Protection Act, 1986.

Single-point access to justice was given in the Consumer Protection Act of 1986, which used to take a lot of time. In the old Act, there was a system of three-tier consumer dispute redressal mechanism [National (National Consumer Disputes Redressal Commission), State and District level].

What's new again in the Consumer Protection Act, 2019?

  •  Given the definition of consumer in the Act, it has been said that a consumer is a person who buys any goods or services by paying a price. This means that if a person acquires any goods or services for resale or for commercial purposes, then that person will not be called a consumer.
  • All types of transactions have been included in the Act, such as - offline, online, teleshopping, multi-level marketing, or direct selling.
  • Some of the main rights of consumers have been mentioned in the Act:  i) to be protected from the marketing of goods and services injurious to life and property ii) to obtain information related to the quality, quantity, efficiency, purity, standard, and price of goods and services iii) iv) Access to a wide variety of goods or services at competitive prices iv) Seek solutions to unjust or compulsive trade practices.
  • According to the Act, the Central Government will constitute a Central Consumer Protection Authority  (CCPA) with the objective of promoting, protecting, and enforcing the rights of consumers. This authority will be the regulatory body for matters related to violation of consumer rights, unjust business practices, and misleading advertisements. This Authority shall also have an Investigation Wing headed by a Director-General who may inquire or investigate these contraventions.  
  • 10  lakh to the CCPA manufacturer or promoter for false or misleading advertisement. shall be punishable with a fine which may extend to two years and with imprisonment of either description for a term which may extend to two years. If a producer or a publicist commits such an offense again, then a fine of Rs 50 lakh will be imposed on him. shall be punishable with a fine which may extend to five years and with imprisonment of either description for a term which may extend to five years.
  • The government will notify the Consumer Protection (E-Commerce) Rules, 2020 under the Act.

Functions of CCPA

  1. To investigate and investigate cases of violation of consumer rights and to file suit at the appropriate forum.
  2. To issue orders to return harmful goods or services and to return the price paid and to stop unjust trading practices as defined in the Act.
  3. Issuing instructions to the concerned merchant/producer/promoter/advertiser/publisher to stop or rectify the false or misleading advertisements.
  4. to punish, and
  5. Issuing information to alert consumers about unsafe goods and services.

Rules on e-commerce and unfair trade practices

As we said that the Government will notify the Consumer Protection (E-Commerce) Rules, 2020 under the Act, the broad provisions of which are as follows:

  • Every e-commerce entity including its country of origin will be required to provide information regarding returns, refunds, exchanges, warranties and guarantees, delivery and shipments, modes of payment, grievance redressal mechanism, modes of payment, security of payment methods, duty refund options, etc. Reporting is mandatory.
  • All this information is necessary to enable the consumer to make a suitable decision before making a purchase on our platform.
  • The e-commerce platforms will have to inform the consumer of receipt of the complaint within 48 hours and the same will have to be disposed of within one month from the date of receipt of the complaint.
  • The new Act introduces the concept of product liability and brings under its ambit the product manufacturer, product service provider, and product seller for any claim of compensation.
  • The Consumer Protection (E-Commerce) Rules, 2020 are mandatory, they are not mere advisories.
  • Product Liability: If a defect is found in any product or service, then the product manufacturer/seller or service provider will be held liable for damages.
  • According to the Bill, defects can be found in a product on the following grounds:-
    • Error in the creation of the product/service.
    • Design error.
    • The actual product differs from the stated characteristics of the product.
    • Not to be in conformity with the specified warranty.
    • Defects in the services provided.
  • Punishment in respect of manufacture or sale of adulterated / counterfeit goods: This Act provides for punishment for the manufacture or sale of counterfeit goods by a competent court. In the case of the first conviction, the concerned court may suspend any license issued to a person for a period of up to two years and if found guilty for the second time or thereafter, his license may also be canceled.
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