Synopsis of Important Changes in Consumer Act that will affect ecommerce company:

 The Consumer Protection Act,2019 comes in to force from today i.e. 20th July 2020.
 The new Act defines an electronic service provider as a person who provides technologies or
processes to enable a product seller to engage in advertising or selling goods or services to a
consumer and includes any online marketplace or online auction sites. The electronic service
provider could cover services related to software downloads, electronic payments etc.
 The Act defines e-commerce as buying or selling of goods or services including digital products
over digital or electronic networks.
 Importantly, the rules stipulate that e-commerce entities must also include country of origin.
 E-commerce platforms have to acknowledge the receipt of any consumer complaint within
forty-eight hours and redress the complaint within one month from the date of receipt under
this Act.
 Under the new notified provisions, a consumer can now institute a complaint from her place of
residence or where she works for gain. This comes as a significant change from the earlier
version of the Act under which a complaint could be initiated only in the place where the
transaction took place.
 Celebrity branding may no longer be an easy route of marketing products
 Formation of Central Consumer Protection Authority

The Act includes rules for the establishment of the Central Consumer Protection Authority (CCPA) to
protect and enforce the rights of consumers.

The CCPA will be empowered to conduct investigations into violations of consumer rights and
institute complaints and prosecution, order recall of unsafe goods and services as well as
discontinue unfair trade practices and misleading advertisements.

It will also have powers to impose penalties on manufacturers, endorsers and publishers of
misleading advertisements.

 Pecuniary jurisdiction

The changes in the pecuniary jurisdiction are as follows:

The pecuniary jurisdiction of District Commissions has increased from ₹20 lakh earlier to up to
₹1 crore.

Pecuniary jurisdiction of State Commissions increased from ₹1 crore to Rs 10 crore.

National Commission can hear cases above ₹10 crore, up from the earlier threshold of ₹1 crore.

The new provisions also include deemed admissibility of complaints if the question of
admissibility is not decided within the specified period of 21 days.

 Under this act every e-commerce entity is required to provide information relating to

return of goods
 refund

exchange

warranty and guarantee

delivery and shipment

modes of payment

grievance redressal mechanism

payment methods

security of payment methods

 The provisions in Sections 49(2) and 59(2) of the Act empower both the State Commission
and National Commission to deem any terms of the contract between the consumer and
the service provider/manufacturer as the case may be, which are unfair to any consumer,
to be ineffective and void. This is a new provision/power vested upon the SCDRC and the
NCDRC which was not a part of the old Act.
 The period of limitation for filing a complaint is still 2 years and there is a provision for
condonation of delay and the same is provided for under Section 69.
 The Opposite Party must now deposit 50% of the amount ordered by the District
Commission before preferring an appeal to the State Consumer Disputes Redressal
Commission ('SCDRC'/'State Commission') as opposed to the previous ceiling was of
maximum of Rs. 25,000/-, which has now been done away with.
 The period of limitation for preferring an appeal to the State Commission from an order of
the District Commission has been increased from 30 days under the old Act to 45 days
under the Act. The power to condone the delay however has been retained.
 There is now a provision for a second appeal to the NCDRC which has been provided for
under section 51 clause (3) of the Act in the event that there is a substantial question of law
involved.
 The NCDRC can still exercise its power of revision under section 58 clause (1) sub-clause (b)
of the Act and by the SCDRC can exercise the same power under section 47 clause (1) sub-
clause (b) of the Act.

 Punishments
1. 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.
2. Whoever, fails to comply with any direction of the Central Authority under sections 20 and 21,
shall be punished with imprisonment for a term which may extend to six months or with fine
which may extend to twenty lakh rupees, or with both.
3. Any manufacturer or service provider who causes a false or misleading advertisement to be
made which is prejudicial to the interest of consumers shall be punished with imprisonment for
a term which may extend to two years and with fine which may extend to ten lakh rupees; and
for every subsequent offence, be punished with imprisonment for a term which may extend to
five years and with fine which may extend to fifty lakh rupees.
4. Whoever, by himself or by any other person on his behalf, manufactures for sale or stores or
sells or distributes or imports any product containing an adulterant shall be punished, if such act
— (a) does not result in any injury to the consumer, with imprisonment for a term which may
extend to six months and with fine which may extend to one lakh rupees; (b) causing injury not
amounting to grievous hurt to the consumer, with imprisonment for a term which may extend
to one year and with fine which may extend to three lakh rupees; (c) causing injury resulting in
grievous hurt to the consumer, with imprisonment for a term which may extend to seven years
and with fine which may extend to five lakh rupees; and (d) results in the death of a consumer,
with imprisonment for a term which shall not be less than seven years, but which may extend to
imprisonment for life and with fine which shall not be less than ten lakh rupees. (2) The offences
under clauses (c) and (d) of sub-section (1) shall be cognizable and non-bailable. (3)
Notwithstanding the punishment under sub-section (1), the court may, in case of first
conviction, suspend any licence issued to the person referred to in that sub-section, under any
law for the time being in force, for a period up to two years, and in case of second or
subsequent conviction, cancel the licence.