Consumer Protection Act
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This article is written by Shreyak Patnaik, a third-year student pursuing B.A LL.B from Symbiosis Law School, Hyderabad. This article deal with the Consumer Protection Act, 2019, the changes the act has gone through, the relevant authorities and important cases to keep in mind. 


You’re a consumer. No, it’s not a conditional statement. If you are reading this article on the Ipleaders blog. You are a consumer. You have purchased a phone, a computer or whatever device you are viewing this on, you have bought an internet connection and have paid for the electricity which is charging the device you are using to read this article. You are a part of the society, and therefore are also a consumer of the market that inherently exists in modern society. Humans are not self-sustainable, they rely on each other which forms the basis of society, and with society, there also exists a market: A commonplace for individuals to trade their commodities and buy other individual’s commodities and services. So being a part of that system, makes you a consumer. Now, as a consumer, you are entitled to certain rights when you purchase something from the market, much like any other individual living in society being entitled to societal rights.

So, as an individual of the society, the way you are aware that you can’t be murdered or can’t have your purse stolen from you at gunpoint. Similarly, a consumer, you must also be aware of certain rights you are entitled to, as a participant of the market.

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Definition of consumer

I told you that you’re a consumer. But that’s not enough, is it? When are you a customer? What brings you within the ambit of a customer? The answer lies in The Consumer Protection Act, 2019. Any problems you have as a consumer and all the rights that you are entitled to as a consumer along with how to go about the procedure in case any of those rights are violated are all mentioned in this Act. So who is a consumer? 

Under section 2(7) of the Act, it is stated that consumer is anyone who:

 (i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or 

(ii) hires or avails of any service for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such service other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first-mentioned person, but does not include a person who avails of such service for any commercial purpose.

If you have bought any goods or hired any service whatsoever for any consideration or with a promise to pay consideration or with an arrangement which allows you to pay in instalment (think: EMI), or are using goods or availing services hired by someone else but with their permission, then you’re a consumer of the good or service. 

Definition of deficiency in service

Deficiency, within the meaning of the Act, is always of service. So, problems in the goods purchased are defects and defects in services availed is labelled as a deficiency. Deficiency is defined in the Act under section 2(11): 

“deficiency” means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service and includes:

 (i) any act of negligence or omission or commission by such person which causes loss or injury to the consumer; and 

(ii) deliberate withholding of relevant information by such person to the consumer; 

So for example, if you have hired a mechanic to refill your bike’s mobile oil and he negligently uses petrol instead of mobile oil, that will be called a deficiency in service. Basically, if you face a loss directly because of the acts of the individual whose service you hired, then it can be labelled a deficiency in service

Consumer protection redressal agencies

To protect consumer rights, the Act mentions the establishment of three redressal mechanisms wherein the consumers can approach to address their grievances. 

District Commission 

This the lowest rung in the redressal commissions that consumers can approach. The State Government, under section 28(1) establishes at least one district consumer dispute redressal commission in every district of the state. If the government deems fit, it can even establish more than one district commission in a district. Every district commission needs to have a minimum of one president and two members but can have more members after discussing it with the Central government. If your redressal value is 1 crore or less than that, then you can approach the district commission. 

Who can file a complaint at the district commission? 

The following people can file a complaint at the commission under section 35(1) of the Act:

  • The consumer

i) To whom such goods are delivered, or sold or agreed to be sold or such service which has been provided or has been agreed to be provided.

ii) Who alleges unfair trade practises in respect of such goods. 

  • Consumer Association

Any voluntary consumer association registered under the law. It doesn’t matter if the consumer is part of such association or not. 

  • One or more consumers appearing on behalf of all consumers with a common interest

These consumers would first need to get permission from the District Commission to proceed with the complaint in such a manner. 

  • The Central Government, The State Government or the Central Authority as the case might be 

Under Section 34(2), a complaint can be filed at the District Court under within whose local limits: 

    • The opposite party or each of the opposition parties, in case there are more than one, normally reside, or carry on business, or have a branch or personally work for gain. 
  • Any of the opposite parties ordinarily reside, or carry on business, or personally work for gain. Provided, the permission of the district commission is taken. 
  • Where the cause of action wholly or partly arises. 
  • Where the complainant resides or personally works for gain. 

On filing the complaint, it is necessary for the Commission to admit or reject the complaint within 21 days of receiving the complaint. It is legally prohibited under Section 36 for the commission to reject a complaint without first hearing the complainant. It is also necessary for every proceeding to be presided by the President and one member at least. Where the member who has been sitting for a particular proceeding is absent, the proceeding can be resumed with another method.
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Once the complaint is admitted, the commission must:

  1. Refer a copy of the complaint, within 21 days of the complaint being admitted, to the opposite party and direct it to give its version of the story within 30 days or the extended period granted by the commission. 
  2. If the opposite party disputes the allegation or fails and omits to take any action regarding the complaint, then district commission must deal with it in the following ways. 
  3. Must seal the allegedly defective goods, and send them to the appropriate laboratory after authenticating it in the manner required. It must direct the laboratory to find if there is any genuine fault with the goods and report its findings to the commission within 45 days or how much ever time granted by the commission.
  4. Before the goods go to the library, the complainant must be directed to deposit the sum of money required for testing in the credit of the commission. 
  5. If any of the parties dispute the correctness of the finding of the laboratory, then the parties must be directed to submit their objections in writing to the commission.
  6. Give a reasonable opportunity to the opposite party or the initiating party to be heard regarding their objections. 

If the above-mentioned procedure can’t be followed due to the lack of goods to take a sample from or if the defect alleged is in the service of the opposite party. Then the commission shall settle the dispute: 

  1. On the basis of evidence provided by the complainant or the opposite party if the opposite party disputes the allegation. 
  2. Take an ex parte decision if the opposite party omits to do anything regarding the allegations. 
  3. Decide the case on its merits if the complainant fails to show up for the hearing. 

If it’s inconvenient for the party to show up to the commission in person, you can submit an application for hearing or examination of parties through video conferencing and if the district commission agrees with the reasons then it may allow so after recording the reason. 

The commission must deal with the case as expeditiously as possible and endeavour must be done to dispose of the case within three months if no analysis or testing is required and five months if analysis and testing are required. 

The District commission has the same power as the district court under this act.

If a party is aggrieved by the order of the district commission then they may prefer an appeal to the State Commission within 45 days of receiving such order. Even though the State Commission may entertain the plea after 45 days if sufficient reason is given by the party. 

The State Commission shall not hear the appeal of the party if the party has to pay a certain amount ordered to be paid by the District Commission. Minimum 50% of the amount must be paid before the State Commission will hear the appeal.

State Commission 

The State government establishes a State commission, under section 42(1) of the Act, in the state through the notification and can even establish regional branches if it seems fit. Each State Commission shall consist of one President and no less than four members and a maximum of as many members as is required. 

According to section 47, the State Commission has the jurisdiction to entertain:

(i) complaints where the value of the goods or services paid as consideration, exceeds rupees one crore but does not exceed rupees ten crores: 

Provided that where the Central Government deems it necessary so to do, it may prescribe such other value, as it deems fit; 

(ii) complaints against unfair contracts, where the value of goods or services paid as consideration does not exceed ten crore rupees; 

(iii) appeals against the orders of any District Commission within the State;

Apart from that, it also has the jurisdiction to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any District Commission within the State, where it appears to the State Commission that such District Commission has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested or has acted in exercise of its jurisdiction illegally or with material irregularity. 

A bench of the State Commission must consist of a President and one member or more if the president deems it fit. 

The State Commission also has the power to shift proceedings from one district commission to another under section 48. The State Commission can do that on its own cognizance or through an application filed by the parties. But it must be to serve the purpose of justice. 

State Commission disposes of the case in the exact same method as the District Commission and also holds the power to review its own cases. 

If aggrieved by the decision, the aggrieved party may prefer an appeal to the National Commission within 30 days of receiving the order from the state commission. If sufficient reason is shown then the national commission can also entertain the plea after the thirty days. 

The national commission shall not listen to an appeal if the person who has to pay a particular amount from the order of the state commission, has not paid at least 50% of the amount ordered to be paid.

The appeal must be dealt with expeditiously and endeavours must be made to dispose of the appeal within 90 days from its date of admission.

National Commission 

Under Section 53(1), the Central Government establishes a National commission through notification. The main National Commission operates on the national capital region but the Central government can establish regional branches through notification. The National Commission must have one president and at least 4 members with the maximum being whatever is prescribed by the national government. 

The National Commission has jurisdiction, under section 58 of the Act: 

(a) to entertain:

(i) complaints where the value of the goods or services paid as consideration exceeds rupees ten crores: Provided that where the Central Government deems it necessary so to do, it may prescribe such other value, as it deems fit; 

(ii) complaints against unfair contracts, where the value of goods or services paid as consideration exceeds ten crore rupees; 

(iii) appeals against the orders of any State Commission; 

(iv) appeals against the orders of the Central Authority; and 

(b) to call for the records and pass appropriate orders in 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. 

A bench in the National Commission must at least consist of the President and one member but there can be more members if the President deems it fit.

The National Commission disposes of a case in the same manner as the district commission and also reserves the right to review its cases suo moto or based on an application filed by one of the parties.

Section 65(1) also states

All notices, required by this Act to be served, shall be served by delivering or transmitting a copy thereof by registered post acknowledgment due addressed to opposite party against whom complaint is made or to the complainant by speed post or by such courier service, approved by the District Commission, the State Commission or the National Commission, as the case may be, or by any other mode of transmission of documents including electronic means:

If the postal delivery guy acknowledges that the post was refused by the party then the commission must acknowledge the party as duly served under 65(2).

If aggrieved by the decision then an appeal does lie to the Supreme Court if made within thirty days of receiving the order.

Administrative control

Section 70 of the act states that the national commission shall lay down regulations for the State Commission after consultation with the Central government, for the better protection of the consumers and for that purpose must also have administrative control over all state commissions in the following matters: 

a) monitoring performance of the State Commissions in terms of their disposal by calling for periodical returns regarding the institution, disposal and pendency of cases; 

(b) investigating into any allegations against the President and members of a State Commission and submitting inquiry report to the State Government concerned along with copy endorsed to the Central Government for necessary action; 

(c) issuance of instructions regarding the adoption of uniform procedure in the hearing of matters, prior service of copies of documents produced by one party to the opposite parties, furnishing of the English translation of judgments written in any language, speedy grant of copies of documents;

(d) Overseeing the functioning of the State Commission or the District Commission either by way of inspection or by any other means, as the National Commission may like to order from time to time, to ensure that the objects and purposes of the Act are best served and the standards set by the National Commission are implemented without interfering with their quasi-judicial freedom.

There shall be a monitoring cell instituted by the president of the national commission and the State Commission shall also have the same administrative control over the district commission. 

Section 71 of the Act also states that every decision of the commission must be enforced in the same way as a decree made by the court under Order XXI of the first schedule of the Civil procedure code. 

Section 72 lays down the punishment on the disobedience of commission orders:

Whoever fails to comply with any order made by the District Commission or the State Commission or the National Commission, as the case may be, shall be punishable with imprisonment for a term which shall not be less than one month, but which may extend to three years, or with fine, which shall not be less than twenty-five thousand rupees, but which may extend to one lakh rupees, or with both. 

The section further grants the commissions the same power as a judicial magistrate first class under the Code of Criminal Procedure.

Comparative Analysis of Consumer Protection Act: 1986 and 2019

The amendment of 2019 to the Consumer Protection Act came after thirty-three years of the act being passed. Technology has progressed a lot in these years and while the older act tried to keep updated with small amendments here and there. The repeal of the older act and the establishment of the 2019 act was much needed. So what’s new in the Consumer Protection Act, 2019?

First and foremost, while there have been judicial pronouncements bringing the purchases made through online methods under the ambit of consumers. The 2019 Act explicitly includes the consumer who purchases goods or services online. Apart from the inclusion of online purchases the act has also made endorsers answerable regarding false or misleading advertisements. In the 1986 act, the onus of that was only on the manufacturers and the service providers. Under section 21(2) of the 2019 Act, the commission could even levy a fine of fifty lakhs of the endorser continues to advertise false information about the products even after getting a notice issued by the consumer. Misleading advertisements are also under the ambit of ‘Unfair Trade Practices’ in the new act. Disclosure of personal information given in the course of the transaction is also considered an offence under the act. The Act also proposes provision for product liability wherein the manufacturer not only has to compensate for the defective goods but also has to compensate for any loss or injury inflicted on the complainant due to the defect. So for example, if a bike is sold to you and the break is loose and you have an accident as a result, the manufacturer has to compensate for the defect and also compensate you for the accident which you faced because of the defect.

It’s not just the offence though, the redressal agencies have also gone through changes under the new Act. While the 1986 act did stipulate for the commissions to either accept or reject a complaint within 21 days of receiving it, the 2019 act has gone a step further and stated that if no action has been taken within 21 days then the complaint is to be assumed to be admitted. The pecuniary jurisdiction of the district commission has also been raised to ease the burden of the state and national commissions. You can apply to the district commission now if the value of your case is within 1 crore. You don’t even need to file the complaint at the residence of the opposite party. It can be filed where you reside or where the cause of action arose as well. The commissions also have the power to review their cases now and can also refer cases to mediation with the consent of both the parties.

The act also proposes for the establishment of an independent regulator: Central Consumer Protection Authority (CCPA). While this authority won’t be listening to consumer grievances or settling disputes, it will be taking administrative steps such as imposing liabilities to address any unfair trade practises etc. It’s essentially another body to ensure a stronger presence of consumer rights in the country.
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Cases on Consumer Protection Act

Class Action Suit under The Consumer Protection Act

In the case of Ambrish Kumar Shukla & 21 others. v. Ferrous Infrastructure Pvt. Ltd., the national commission had the question of the legitimacy of class action suit posed in front of it. The respondents in the case argued that even if the interest is similar, with multiple causes of action, the provisions of 13(6) will not be binding on the case and therefore a class action suits with multiple consumers cannot be entertained since the consumers only really care about their cases which were different in relief and therefore it cannot be considered to be the same interest. The National Commission rejected this argument stating, while placing reliance on the rationale of the Supreme Court bench in the case of Chairman, Tamil Nadu Housing Board, Madras vs. T.N Ganapathy, that provision of 13(6), which allowed Rule 8 Order 1 of the Civil Procedure Code apply to class-action suits in consumer disputes, and of 12(1)(c) were to facilitate decisions where a large number of consumers were interested without recourse to each of them filing an individual complaint. The Commission said that the intention of the legislation must be looked at the interpretation accordingly must be done to subserve the intention of the legislation. 

The intention of class action suits stipulated in Rule 8 Order 1 and by way of that, 13(6) and 12(1)(c), was to avoid multiplicity of proceedings and therefore in deciding if a class action suit can be bought it is that particular intention which has to be kept in mind. The commission stated that mere difference in the cause of action among the different relief seekers will not be a bar from a class action suit if the nature of the interest asked by all of them is the same. The commission took the example of a builder defaulting in giving the flats to the residents even after getting paid.

The residents could have different flats such as 2BHKs and 4BHKs and 1BHKs and therefore will have different reliefs but they all share the same interest of either getting damages from the builder or getting possession of their flats and therefore can join together to institute a single suit against the builder. Now, the other side to it is that the consumers don’t have the option to only include only some of the aggrieved consumers in the complaint. On instituting a class action suit, it is the court’s responsibility to give notice to all consumers interested in the case to join the suit. The cost of serving notice to all the interested parties will be done at the expense of the person who instituted the suit. Moreover, if the person who instituted the suit has not done due diligence and is unaware of the case facts, the commission can substitute the instituting consumers with another interested consumer from the complaint. 

How can a commission decide the pecuniary jurisdiction? 

One more question which was posed in front of the commission was regarding the grounds on which the pecuniary jurisdiction of the commission is to be decided. The commission stated that in deciding the pecuniary jurisdiction the aggregated prices of the good and the compensation claimed must be taken into consideration and if its a class action suit then the aggregate prices of all the goods involved and the total compensation claimed must be taken into consideration in deciding the pecuniary jurisdiction of the commission. Further clarifying, the commission also cleared the question regarding whether the market value of the goods is to be considered or the price at which the goods were purchased by the consumer. The commission stated that the price was paid to be purchased by the consumer must be the price that is considered.

While this decision did come at a time when the Consumer Protection Act, 1986 was in the place. The rationale of this commission was affirmed by the Supreme Court bench in 2019 in the case of Rameshwar Prasad Shrivastava v. Dwarkadhin Project (P) Ltd. [(2019) 2 SCC 417].

Limitation Provision in the Consumer Protection Act 

In the case of National Insurance Company Ltd. v. Hindustan Safety Glass Works Ltd. & Anr., the respondents were seeking Supreme Court interference in the dispute being heard by the National Commission on the grounds that the complaint was admitted by the Commission after the duration prescribed by the Statuette of Limitation. The Court noticed that the delay in filing a complaint happened only because of the delay caused by the respondent. In the case, the complainant had filed for insurance the day after the mishap happened but the insurance company stalled the payment by taking the opinion of two different surveyors before eventually completely denying payment. 

The court stated that the limitation was not supposed to be strictly followed. Rather, a pragmatic view of the rights of the consumer must be taken into consideration. The court in the case stated that provision of the limitation cannot be strictly construed for the disadvantage of the consumer, especially where the supplier is causing a delay. If the delay caused is outside the power of the complainant then some concession can be granted. Therefore the Supreme Court allowed the case to be admitted in the commission. 

Trust cannot Lodge a Complaint under the Consumer Protection Act

In the case of Pratibha Pratisthan & Ors. v. Manager, Canara Bank & Ors, it was stated that since a trust does not come under the definition of neither consumer nor complainant nor even “person”. Therefore the trust cannot lodge a complaint under the Consumer Protection Act. The same was also affirmed in the case of Consumer Online Foundation through its Managing Trustee, Mr Bejon Kumar Mishra vs. M/s Supertech Ltd 1114, Hemlunt Chambers 89, 11th Floor, Nehru Place, New Delhi 110019.

Insurance Company cannot Reject Claims on Technical Grounds

In the case of Om Prakash v. Reliance General Insurance[(2017) 9 SCC 724], The insurance company denied the complainant insurance based on his delay in intimating the insurance company. The complainant stated that it was out of his power. The court finding substance in his argument stated that the inability to meet conditions due to circumstances outside the power of the victim must not be a bar for settling genuine claims. The Court stated that the Consumer Protection Act, 2019 was beneficial legislation and therefore the interpretation of the legislation must be liberal keeping the benefit of the consumer in mind. 

Corporate Bodies can be sued under the Consumer Protection Act

In the case of Karnataka Power Transmission Corporation v Ashok Iron Works Private Limited, [(2009) 3 SCC 240] the question of whether a corporation can be considered a “person” under the Consumer Protection Act. The Court, answering the question in the affirmative, stated that the definition of “person” in section 2(1)(m) is not an exhaustive definition but an inclusive one. The court called that clause to be an interpretative one and therefore urged for interpretation to be done with the intention of the legislature in mind. The court stated that the legislature would not have intended to exclude a juristic person from the definition of person enumerated in the Act. Therefore, corporate bodies were “persons” under the ambit of the act and were liable to be sued under the Act as well. 

Professional services fall within the scope of the Act

The question of the status of professional services rendered under the Consumer Protection Act was raised in the case of Indian Medical Association v V.P. Shantha and others. The status of the service rendered by a medical professional was going to be seen in respect to section 2(1)(o) of the Act, which reads as follows:

“service” means service of any description which is made avail­able to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service;

The apex court stated that since the Act was established for the benefit of the consumer, the definition of the “service” was also to be construed keeping the “consumer” in mind. On perusal of section 2(1)(o) if the act, the court stated that the definition of service was divided into three parts, namely, the main part, the inclusionary part and the exclusionary part. The court stated that the scope of main part in itself was extremely wide while placing reliance on another judgement, namely, Lucknow Development Authority vs. M.K Gupta, where the court had used the definition of “any” established in Black Law’s dictionary to establish that it meant “all” or “some” or even “one”.The court in that judgement stated that the main part gave the widest scope to the definition of service with inclusive part adding to the list but not exhausting it. The exclusive part placed only two things as bars so essentially with all three added, a service doesn’t come in the ambit of consumer protection act, only if it’s free of charge or personal service.

In the medical association case, it was contended that service can only bind occupations and not professions and furthermore, people practising in the medical profession were already answerable to the Medical Council Act. The Supreme Court rejected both the contentions stating that every professional is to be answerable to a certain state of competency and therefore is not free from giving damages in case of negligence act. The apex court also stated that being answerable to the Indian Medical Council Act for professional follies is no solace for the victim of the negligence of the medical professional. Placing reliance on the changing status of the medical professionals in the UK where they are deemed to be public servants engaging in commercial activities on a wide scale therefore answerable to the same consumer rules as other service providers, the court concluded that medical practitioners are not free from the ambit of service defined in consumer protection act, merely because it is a profession. The respondents also placed another contention that since deficiency of service only refers to inadequacy or shortcoming or faults and the medical practice cannot be judged on any such fixed norms, it therefore cannot be termed a service. The court placed reliance of section 14(1)(d) of the act wherein it was mentioned that the consumer could file for relief for the loss caused due to negligent act of the service provider and therefore stated that the deficiency of service was to be ascertained with the same test as is used to determine damages due to negligence. The respondents further argued that since the bench was made with a composition which could not understand the complexities of the profession, therefore, it was not competent to judge in the case. The court rejected that contention as well stating that the Bench’s job was to look at a case from a legal perspective and it was the job of the parties to put forth the arguments. Help could be taken from experts in the field to help propound certain arguments and the bench was supposed to take all the facts given and state the legal authenticity of it. It is impossible to put a bench ho is well versed in all the subject matters that come before it and only need to be well versed in the legal jurisprudence which the President it. 

Therefore, the apex court concluded that services rendered by medical practitioners by way of consultation, diagnosis and treatment (either surgical or medicinal) are within the ambit of service. Service rendered by the doctor free of charge shall not be considered within the ambit of service under the Act and the payment of a mere token charge for consultation shall not be considered as consideration for the treatment. 

Services have to be rendered with due care and in accordance with Law

In the case of Poonam Verma v Ashwin Patel & Ors, The court stated, while placing reliance on the case of Indian Medical Association vs. V.P Shanta and others (Discussed above) states that medical practitioners have a duty of care to their patients. The court also mentioned the difference between a doctor of homoeopathy and a doctor of medicine and stated that a doctor of homoeopathy is not a registered doctor and therefore can’t administer medicinal treatments supposed to be given by registered doctors. 

Educational institutions must refund the extra fee paid

In the case of Sehgal School of Competition v Dalbir Singh, the complainant had paid the entire fees to the coaching institute but left halfway since the coaching institute was not teaching the subjects he was interested in learning. On asking for the refund of the extra amount paid, the institute denied which prompted the complaint with the national commission. The commission stated that coaching should not charge a lump sum amount and directed the coaching institute to refund the extra amount due to the complainant. 

Sympathy should not influence compensation

In the case of Nizam Institute of Medical Sciences v Prasanth S. Dhananka & Ors., much of the argument revolved around the question regarding the fault of the doctors. They found guilty of negligence and the complainant asked for 48 crores as compensation. The court agreed that the compensation was excessive and re-calculated the amount required by the complainant. The court said the complainant is entitled to the amount that is required by the complainant, but nothing more. The court said sympathy for the victim cannot influence the compensation awarded and the court has a responsibility of striking a balance and should only provide adequate compensation. 

Discovery rule for medical negligence

The discovery rule used to decide when the cause of arises in cases of a medical emergency was first propounded in Ayers v. Morgan [397 Pa.282, 154A.2d 788] by the US courts and was adopted by the Indian legal jurisprudence In the case of V.N.Shrikhande vs Anita Sena Fernandes. In the particular case, the complainant was negligently treated by the doctor resulting in a gauze inside her stomach creating an infection. The complainant got tested 9 years after the initial operation in the duration of which she was under constant pain. The respondents contended that since she did not visit the doctor even once after the operation and 9 years had passed so the entire complaint was barred by limitation. The court in response to this borrowed from the US ‘discovery rule’. Under the rule, negligence could be categorized into two kinds: 1) Patent 2) Latent. So if the damage inflicted by the doctor due to negligence is patent, then the cause of action arises on the date the act was committed but, on the other hand, if the act did was latent, then the cause of action arises when the victim realises the negligence. 

The court applying the rule said that the negligence in the case was latent, and therefore the complaint was within limitation.

Both parents and minor can claim for compensation under the Consumer Protection Act

In the case of Spring Meadows Hospital & Anr v Harjol Ahluwalia, the court was presented with the question of whether parents who take their child to the hospital are also consumers along with the child. The court answered in the affirmative stating that when parents take their child to the hospital, they are hiring the services of the doctor for their child and therefore come under the definition of the consumer while the child who is a beneficiary of the service also becomes a consumer. The court furthermore rejected the contention of the respondent that compensation can only be awarded to one of the parties i.e. the child and stated that since the child being beneficiary faced loss due to the negligence and the parent being hirer of the service also face loss in the form of mental agony. Both of them are liable to be awarded compensation. 

The imposition of a penalty for frivolous consumer claims

In the case of Sapient Corporation Employees Provident Fund Trust v HDFC & Ors., the complainant had alleged deficiency of service being provided by the respondent i.e the bank. The court rejected that argument also held that the complaint made by the complainant was frivolous and since the act was social legislation and does not charge court fees. There needs to be a guard against such frivolous complaints and therefore imposed a 25,000 rs fine on the complainant for a frivolous complaint.

Compensation to the complainants for frivolous appeals

In the case of Delhi Development Authority v D.C. Sharma, the appellant had frivolously instigated a suit against the respondent to keep him from getting the apartment allotted to him. The court noticed the baseless arguments and the clear intent of a frivolous suit, stated the following: 

We are clearly of the view that unless we ensure that wrongdoers are denied profit or undue benefit from frivolous litigation, it would be difficult to control frivolous and uncalled for litigations. In order to curb uncalled for and frivolous litigation, the Courts have to ensure that there is no incentive or motive for uncalled for litigation. It is a matter of common experience that courts otherwise scarce and valuable time are consumed or more appropriately wasted in a large number of uncalled for cases.

It is also a matter of common experience that to achieve clandestine objects, false pleas are often taken and forged documents are filed indiscriminately in our courts because they have hardly any apprehension of being prosecuted for perjury by the courts or even pay heavy costs. In Swaran Singh Vs. State of Punjab (2000) 5 SCC 668 this Court was constrained to observe that perjury has become a way of life in our courts.

It is a typical example of how a litigation proceeds and continues and in the end, there is a profit for the wrongdoers.

The court imposed a cost of 2,00,00 on the appellant to make sure no profit or benefit comes to the people who instituted frivolous lawsuits.


As a consumer, it is imperative for you to understand the rights and the reliefs awarded for violation of those rights. Only when the consumers in a country adamantly stand for what’s their rights will the sellers and the manufacturers take precautionary measures to ensure they never get involved over disputes regarding the violation of consumer rights. With the social legislation for consumers getting a new update and calling out the mistakes and shady practises of sellers and manufacturers being easier than ever. The onus is now on us as consumers to ensure our well-being. The maxim caveat emptor (buyer beware!) might have been rendered obsolete thanks to the new act, but it can only truly go obsolete when we use the rights that have been given to us.

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