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What are the new features of Consumer Protection Bill, 2015?

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This article is written by Dhruv Dikshit, a student of LC-II, Delhi University.

The growth of consumerism and the dependence of the world economy on it is immense and is increasing at an alarming rate. Consumers, at the end of the day look for value in the form of efficiency of goods and services. Technological advancements have made an enormous impact on the quality, quantity, productivity, availability and safety of goods and services. Despite the developments, the consumers are still victims of corrupt and fraudulent practices. Such exploitation of consumers takes shape in various ways and is often pre-meditated to increase profit margin such as adulteration of food, deleterious drugs, malicious plans, high prices-poor quality, false advertisements, hazardous products and many more. In addition to that, the development in the sphere of internet connectivity has led to the development of e-markets and e-commerce offering consumers products at their doorstep and more consumer exploitation in the form of cyber-crimes and further harassment. “The consumer is paramount” is nothing more than myth in the present scenario more specifically in the developing societies. However, there are safety mechanisms in place via which a consumer can get access to justice. In this context, the state has the primary responsibility to protect the consumers’ interests and rights through appropriate policy measures, legal structure and administrative framework by the virtue of being a welfare state.

The Consumer Protection Act of 1986 was enacted to provide protection of the interests of consumers and for the purpose of establishment of consumer councils and other authorities for the settlement of consumer disputes, and for matter connected therewith. The said Act was amended three times to make the act more effective but even then there were a few lacunas and nuances that were not incorporated. Several shortcomings have been noticed while administering the various provisions of the said Act.

The new Consumer Protection Bill 2015 that has been introduced in the monsoon session of parliament seeks to replace the old act. The primary motivation to replace the older law with a new one is to modernise the law with respect to the development of new markets and to further widen the ambit and a scope of the law to incorporate nuances so that the big companies cannot use them as loop holes to exploit the consumers and to further increase the accountability of the said companies. The new bill seeks to make manufacturers liable for any injury attributed to the consumer or death of a consumer or property damage and get them sentenced for life.

The new law assumes significant focus as there is growing concern over the safety of consumer products especially after the Maggi controversy where in the consumers were duped for a considerable amount of time. The key features of the new bill include establishment of an exclusive agency called the Central Consumer Protection Authority (CCPA) which will protect and enforce the rights of consumers. CCPA  has the power to recall products and in extension to that the power to withdraw misleading advertisements.

The authority will intervene wherever necessary to prevent consumer exploitation arising from unfair trade practices. In the older act, the consumers needed to approach the court to file a case and start the proceedings, but the present bill has conferred the power of suo moto on to the agency of starting the proceedings against the manufacturers on its own. Furthermore, the agency can initiate class action suits to compensate the people that were affected. Added to that, the power of review of previous decisions has been bestowed to the consumer courts as well thereby giving the existing redressal authorities civil court powers.

Minister of Consumer Affairs, Ram Vilas Paswan explains the rationale behind the new bill that “misleading advertisements, tele-marketing, multi-level marketing, direct selling and e-tailing pose new challenges to consumer protection Hence, there was a need to modernise the act to address the situation effectively”. The consumers are on the receiving end of faulty and incomplete due diligence done by the entity providing platform for e-market, which eventually leads to harassment of the consumers as they are the ones who have to deal with the excessive loss of time and energy required to get remedy for the damage caused. To rectify this situation the bill provides for stringent penalty, including life imprisonment in certain cases as a deterrent. Furthermore, in case an advertiser is providing a misleading advertisement, the proposed regulatory authority can on its own fine the company 10 lakhs and also ask for the withdrawal of the advertisement.

The bill also has several provisions aimed at simplifying the consumer dispute resolution process in the consumer forum. Mediation is put forth as an alternative dispute resolution mechanism. The mediation will be under the supervision of consumer courts. The National Commission or a State Commission or a District Commission, as the circumstances may be, will appoint a mediator who shall attempt to resolve the dispute between the parties by facilitating discussion between parties directly by guiding the parties in identifying issues, reducing misunderstandings, exploring different ways to compromise all in all generating options in an attempt to solve the dispute.

Furthermore, the bill also includes provisions for the enhancement of the pecuniary jurisdiction of the redressal agencies, power to review their own records by the state and district commissions. The bill also seeks to establish a circuit bench to facilitate quicker and an efficient disposal of complaints. To increase the efficiency further, the bill provides the consumers electronic ways over the internet to file complaints in consumer courts that have jurisdiction over the place of residence of the complainant. The complaints will be deemed as admissible if the question of admissibility is not decided within 21 days. Furthermore, the complaint has to be dealt with within 90 days thereby, increasing the efficiency of the juridical proceedings.  The new bill is expected to enhance the quality and safety of products and services adding the proposed law has much-needed provisions ensuring fair equitable and consistent outcomes for consumers.