Centre safeguards consumer rights via various provisions under Consumer Protection Act, 2019

[YAGAY andSUN]

The Consumer Protection Act, 2019 was enacted to safeguard the rights of consumers and provide a comprehensive framework for resolving consumer disputes. It aims to address the growing concerns related to consumer protection in a rapidly changing market environment, with a focus on e-commerce, product quality, and fair trade practices. The Act establishes mechanisms to protect consumers from exploitation and ensures that their rights are upheld.

Key Provisions under the Consumer Protection Act, 2019

1. Consumer Rights

The Act defines the following basic rights of consumers:

• Right to Safety: Protection against goods and services that are hazardous to life and property.
• Right to Be Informed: Right to be provided with information about the quality, quantity, potency, purity, standard, and price of goods and services.
• Right to Choose: Ensures that consumers have access to a variety of goods and services at competitive prices.
• Right to Be Heard: The right to be heard and to be assured that consumer interests will receive due consideration at appropriate forums.
• Right to Seek Redressal: The right to seek compensation for grievances related to unfair trade practices or poor quality products.
• Right to Consumer Education: Empowering consumers with the knowledge they need to make informed choices.

2. Consumer Disputes Redressal Commission (CDRC)

The Act establishes a three-tier dispute redressal mechanism:

• District Consumer Disputes Redressal Commission: Handles complaints involving claims up to ₹1 crore.
• State Consumer Disputes Redressal Commission: Deals with disputes exceeding ₹1 crore but less than ₹10 crore.
• National Consumer Disputes Redressal Commission: Handles disputes above ₹10 crore and appeals against decisions from lower commissions.

These commissions have the power to provide relief in the form of:

• Refunds
• Replacement of defective goods
• Compensation for damages
• Penalties on traders and service providers

3. Central Consumer Protection Authority (CCPA)

The CCPA is a significant body under the Act tasked with:

• Proactive Consumer Protection: The CCPA can initiate suo-motu actions based on consumer complaints or market surveillance.
• Regulation of Unfair Trade Practices: It can take action against misleading advertisements, substandard products, and unfair trade practices.
• Product Liability: The CCPA can take action against manufacturers, service providers, or sellers who fail to meet product safety standards.

The CCPA also has powers to order investigations into consumer complaints, recall unsafe products, and impose fines on errant businesses.

4. E-Commerce and Online Shopping

The Act addresses the increasing consumer issues arising in e-commerce, providing provisions such as:

• Liability of E-commerce Platforms: E-commerce platforms are now legally responsible for product safety, ensuring that the products sold on their platforms meet safety standards.
• Clear Terms and Conditions: Online platforms must provide clear and transparent information on terms of service, including return policies, warranties, and delivery timelines.
• Right to Return: Consumers have the right to return goods purchased online if they do not meet the advertised standards.
• Grievance Redressal Mechanism: E-commerce businesses must establish a mechanism for consumers to file complaints and resolve issues in a timely manner.

5. Product Liability and Penalties

• Product Liability: The Act introduces provisions for product liability, where manufacturers, service providers, and sellers are held responsible for any harm caused by defective goods or deficient services.
• Strict Penalties for Non-Compliance: If a company or individual violates the provisions of the Act, they can face penalties, including fines or imprisonment, depending on the severity of the violation.

6. Unfair Trade Practices

The Act prohibits a range of unfair trade practices, such as:

• False Advertising: Misleading advertisements that deceive consumers are prohibited.
• Defective Goods: Selling defective or substandard products to consumers is a violation of consumer rights.
• Exploitation of Consumers: Practices that deceive or mislead consumers into purchasing goods or services under false pretenses are banned.

These provisions aim to ensure that consumers receive value for their money and are protected from exploitation by businesses.

7. Consumer Protection Councils

• National Consumer Protection Council: The Act provides for the establishment of a National Council that advises the government on consumer protection policies and laws.
• State and District Councils: Similar councils exist at the state and district levels to address consumer issues specific to those areas.

8. Class Action Suits

The Act introduces the concept of class action suits. This allows a group of consumers to file a collective complaint against a company for unfair trade practices, defective goods, or deficient services. This is especially useful in cases where a large number of consumers have been harmed by a common issue.

9. Consumer Awareness and Education

• Consumer Awareness Campaigns: The Act encourages the government and other organizations to run educational programs and campaigns aimed at improving consumer knowledge regarding their rights and how to seek redressal.
• Empowering Consumers: The CCPA, along with other institutions, works to ensure that consumers are aware of their rights and how to exercise them effectively.

10. Digital and Consumer Data Protection

With the rise of digital transactions, the Act also addresses concerns related to the protection of consumer data in digital platforms, ensuring that companies respect the privacy of consumers and handle their personal data responsibly.

Conclusion

The Consumer Protection Act, 2019 provides a robust framework for safeguarding consumer rights and ensuring fair business practices. Through a comprehensive mechanism of dispute resolution, protection against unfair trade practices, and proactive regulatory measures, the Act aims to empower consumers and enhance their confidence in the market. By addressing the challenges posed by e-commerce, product liability, and the need for greater transparency, the Act seeks to ensure that consumers receive the protection they deserve in an increasingly complex marketplace.

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Annexure – 1

Ministry of Consumer Affairs, Food & Public Distribution

Centre safeguards consumer rights via various provisions under Consumer Protection Act, 2019

Central Consumer Protection Authority imposes penalty of ₹ 77 lakh 60 thousand on 24 coaching institutes for misleading advertisements
Department of Consumer Affairs secures refunds of ₹1.56 crores for over 600 aspirants and students in education sector through National Consumer Helpline

Department of Consumer Affairs is continuously working for consumer protection and empowerment of consumers by enactment of progressive legislations. With a view to modernize the framework governing the consumer protection in the new era of globalization, technologies, e-commerce markets etc. Consumer Protection Act, 1986 was repealed and Consumer Protection Act, 2019 was enacted.

Salient features of the new Consumer Protection Act, 2019 are establishment of a Central Consumer Protection Authority(CCPA); simplification of the adjudication process in the Consumer Commissions such as enhancing pecuniary jurisdiction of the Consumer Commissions, online filing of complaint from the Consumer Commission having jurisdiction over the place of work/residence of the consumer irrespective of the place of transaction, videoconferencing for hearing, deemed admissibility of complaints if admissibility is not decided within 21 days of filing; provision of product liability; penal provisions for manufacture/sale of adulterated products/spurious goods; provision for making rules for prevention of unfair trade practice in e-commerce and direct selling.

The Consumer Protection Act, 2019 provides for a three tier quasi-judicial machinery at District, State and Central levels commonly known as “Consumer Commissions” for protection of the rights of consumers and to provide simple and speedy redressal of consumer disputes including those related with unfair trade practices. The Consumer Commissions are empowered to give relief of a specific nature and award compensation to consumers, wherever appropriate.

The National Consumer Helpline (NCH) administered by the Department of Consumer Affairs has emerged as a single point of access to consumers across the country for their grievance redressal at a pre-litigation stage. Consumers can register their grievances from all over the country in 17 languages including Hindi, English, Kashmiri, Punjabi, Nepali, Gujarati, Marathi, Kannada, Telugu, Tamil, Malayalam, Maithili, Santhali, Bengali, Odia, Assamese and Manipuri through a toll-free number 1915. These grievances can be registered on Integrated Grievance Redressal Mechanism (INGRAM), an omni-channel IT enabled central portal, through various channels- WhatsApp (8800001915), SMS (8800001915), email (nch-ca[at]gov[dot]in), the NCH app, the web portal (consumerhelpline.gov.in) and the Umang app, as per their convenience.  1049 companies, who have voluntarily partnered with NCH, as part of the ‘Convergence’ programme directly respond to these grievances according to their redressal process and revert by providing feedback to the complainant on the portal. Complaints against those companies, who have not partnered with National Consumer Helpline, are forwarded to the company for redressal.

To safeguard the interests of consumers from unfair trade practices in e-commerce, the Department of Consumer Affairs has notified the Consumer Protection (E-commerce) Rules, 2020 under the provisions of the Consumer Protection Act, 2019. These rules, inter-alia, outline the responsibilities of e-commerce entities and specify the liabilities of marketplace and inventory e-commerce entities, including provisions for consumer grievance redressal.

The Department of Consumer Affairs, in consultation with all the stakeholders, has finalized a “safety Pledge” which is a voluntary public commitment of e-Commerce platforms to ensure the safety of goods sold online and respect the consumer rights. Aligned with global best practices, this initiative strengthens consumer protection in the e-Commerce. On the National Consumer Day 2024, 13 major e-Commerce companies including Reliance Retail group, Tata sons group, Zomato, Ola, Swiggy etc. signed the Safety Pledge for ensuring consumer safety. The support and agreement of major e-Commerce companies to abide by the safety pledge will go a long way in ensuring protection of consumer rights.

Under the provisions of the Consumer Protection Act, 2019, the Central Consumer Protection Authority (CCPA), an executive agency, came into existence on 24.07.2020. It is designed to intervene, to prevent consumer detriment arising from unfair trade practices and to initiate class action(s), including the enforcement of recalls, refunds and return of products. Its core mandate is to prevent and regulate false or misleading advertisements which are prejudicial to the public interest.

Dark patterns involve using design and choice architecture to deceive, coerce, or influence consumers into making choices that are not in their best interest. Dark patterns encompass a wide range of manipulative practices such as drip pricing, disguised advertisement, bait and switch, false urgency etc. Such practices fall under the category of “unfair trade practices” as defined in the Sub-section 47 under Section 2 of the Consumer Protection Act, 2019.

The CCPA, in exercise of the powers conferred by Section 18 of the Consumer Protection Act, 2019, has issued “Guidelines for Prevention and Regulation of Dark Patterns, 2023” on 30th November, 2023 for prevention and regulation of dark patterns listing 13 specified dark patterns identified in e-Commerce sector. These dark patterns include false urgency, Basket Sneaking, Confirm shaming, forced action, Subscription trap, Interface Interference, Bait and switch, Drip Pricing, Disguised Advertisements, Nagging, Trick Wording, Saas Billing and Rogue Malwares.

The CCPA has also notified the Guidelines for Prevention of Misleading Advertisements and Endorsements for Misleading Advertisements, 2022 on 9th June, 2022. These guidelines inter-alia provide for; (a) conditions for an advertisement to be non-misleading and valid; (b) certain stipulations in respect of bait advertisements and free claim advertisements; and, (c) duties of manufacturer, service provider, advertiser and advertising agency. These guidelines states that due diligence is required for endorsement of advertisements such that any endorsement in an advertisement must reflect the genuine, reasonably current opinion of the individual, group or organisation making such representation and must be based on adequate information about, or experience with, the identified goods, product or service and must not otherwise be deceptive.

Further to strengthen consumer protection, the CCPA enacted the Guidelines for Prevention and Regulation of Greenwashing and Misleading Environmental Claims, 2024 (effective 15th October 2024), mandating transparency in environmental claims and the Guidelines for Prevention of Misleading Advertisements in the Coaching Sector, 2024 (effective 13th November 2024), addressing false claims, exaggerated success rates and unfair practices in coaching institutes.

The CCPA has imposed a penalty of ₹ 77 lakhs 60 thousands on 24 coaching institutes  for misleading advertisements. The Department of Consumer Affairs (DoCA) has successfully secured refunds amounting to ₹1.56 crores for over 600 aspirants and students in the education sector through National Consumer Helpline (NCH). These students, enrolled in coaching centres for Civil Services, Engineering Course and other programmes, were previously denied rightful refunds despite following the terms and conditions set forth by the coaching institutes. The action by the Department has helped students receive compensation for unfulfilled services, late classes, or cancelled courses, ensuring they do not bear the financial burden of unfair business practices.

Action has already been taken by the CCPA against various entities including e-commerce platforms for affecting consumers, as a class, for violation of consumer rights, false and misleading advertisements and unfair trade practices as defined under the Consumer Protection Act, 2019. Action has also been taken against the sale of domestic pressure cookers that do not meet compulsory BIS standards on e-commerce platforms. Additionally, as per CCPA's directions, travel companies have refunded Rs. 1,454 Crores as of 20.03.2024 to consumers for cancelled flights due to the Covid-19 lockdown. CCPA has also mandated that these companies update their websites with clear instructions and status updates on refund claims related to cancelled tickets. Further, 13,118 listings of car seat belt alarm stopper clips have been delisted from major e-commerce platforms based on the Orders passed by CCPA to delist all such products which violates consumer rights and are unfair trade practice under the Consumer Protection Act, 2019 as the sale or marketing of said product compromise with the life and safety of consumer by stopping alarm beep when not wearing seat belts.

The Bureau of Indian Standards (BIS) has notified framework on ‘Online Consumer Reviews — Principles and Requirements for their Collection, Moderation and Publication’ on 23.11.2022 for safeguarding and protecting consumer interest from fake and deceptive reviews in e-commerce. The standards are voluntary and are applicable to every online platform which publishes consumer reviews. The guiding principles of the standard are integrity, accuracy, privacy, security, transparency, accessibility and responsiveness.

Under CONFONET scheme, VC equipment for conducting hearing through video conferencing mode has been installed and made functional at 10 benches of the National Consumer Disputes Redressal Commission (NCDRC) and 35 benches of State Consumer Disputes Redressal Commissions (SCDRCs).

This information was given by the Union Minister of State for the Ministry of Consumer Affairs, Food and Public Distribution, Shri B.L. Verma in a written reply today in the Rajya Sabha.