Consumer Protection

Act,1986

1
Page
 1. CONSUMER AND HIS RIGHTS

Definition of  ‘Consumer’ means any person who, -

Consumer –  buys any goods:
Section 2(1)(d)  for a consideration which has been paid or promised or partly paid
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
 Hires or avails of any services
 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 services 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,
2

 When such services are availed of with the approval of the first
Page

mentioned person but do not include a person who avails of such

 services for any commercial purpose.

Commercial  “Commercial Purpose” does not include use by a person of goods bought
purpose and used by him and services availed by him exclusively for the purposes of
earning his livelihood by means of self-employment

Example

 Purchase of car for running it as taxi for commercial purpose.

Coverage of  Definition of Consumer covers:

definition  One who buys goods for a consideration for personal use
 One who uses such goods with permission of buyer of goods
 One who obtains goods on hire purchase or lease
 One who hires or avails of any services for a consideration
 One who uses the services with permission of person who has hired the
services
 One who obtains services on deferred payment basis – i.e. hire purchase
or lease
 One who buys goods or avails services exclusively for purpose of earning
his livelihood as self-employment.

Who is not  The word ‘Consumer” does not include:

consumer?  One who buys goods or avails services for commercial purposes
 One who has not bought the goods

Person buying  When goods are bought for commercial purposes and such purchase satisfy
goods for self- the following criteria:
employment is  The foods are used by the buyer himself;
consumer  Exclusively for the purpose of earning his livelihood;
 By means of self-employment
 Then such use would not be termed as use for commercial purposes
under the Act, and the user is recognized as a consumer.
 Examples:
 A buys a truck for plying it as a public carrier by himself – A is a consumer.
 A buys a truck and hires a driver to ply it – A is not a consumer.
 However, if such a buyer takes assistance of two or more persons to help
him in operating the vehicle or machine, etc. he does not cease to be a
consumer.
3 Page

Rights of  The Act protects following rights of the consumers:

consumer
 Right of protection from marketing of the goods and services which are
hazardous to life and property.
 Right to be informed about the quality, quantity, purity, standard and
price of the goods or services, so the consumers are protected from the
unfair trade practices.
 Right to have access to variety of the goods and services at competitive
prices.
 Right to be heard and to be assured that consumers’ interests will
receive due consideration
 Right to stop unfair trade practices, restrictive trade practices and
exploitation of consumers.
 Right to consumer education.
 Right of speedy and simple redressal to consumer disputes.

2. SERVICE

Service – Section  “Service” means service of any description,

2(1)(o)  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 a news or other information,
 but does not include rendering of any service free of charge or under a
contract of personal service.
 From the definition given in above paragraph, it can be understood that
service may be of any description and related to any sector if it satisfy the
following criteria:
 Service is made available to the potential users, i.e., service not only to
the actual users but also to those who are capable of using it.
 It shall not be free of charge, e.g., the medical service rendered free of
charge in Government hospital is not a service under the Act.
 It shall not be under a contract of personal service.

Difference  When we talk about “service” under the Consumer Protection Act, we take
4

between it as a regular commercial transaction. Thus, the services rendered under

Page

“contract of the contract of personal service are specifically excluded from the
service” and definition.
“contract for  The expression “Contract of Personal Service” is not defined under the Act.
service” At the same time, contract of personal service is not recognized under Act.
 In common parlance, it means – a contract to render service in a private
capacity to an individual.
 For example, where a servant enters into an agreement with a master for
employment, or where a landlord agrees to supply water to his tenant,
these are the contracts of personal service.
 The idea is that under a personal service relationship, a person can
discontinue the service at any time according to his will and he need not
approach Consumer Forum to complain about deficiency in service.
 In case of “Contract of Personal Service”, the service seeker can order or
require what is to be done and how it should be done.
 Like a master can tell his servant to bring goods from a particular place.
However, in a “Contract for Personal Service”, the service seeker can tell
only what is to be done. How the work will be done is at the wish of the
performer. Like when a person gives a suit to the tailor for stitching, he does
not tell him which method he should use to stitch it.
 Supreme Court in the case of Indian Medical Association v. V.P.Santha,
held that contract for service implies a contract whereby one party
undertakes to render services (generally technical or professional) for
another in the performance of which he is not subject of detailed direction
and control but exercise professional or technical skill and uses his own
knowledge and discretion.
 A contract of service on other hand implies master-servant relationship and
involve obligation to obey orders in work.

Deficiency in  “Deficiency” means any fault, imperfection or shortcoming.

service – Section  In the quality, quantity, potency, purity or standard,
2(1)(g)  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.

Example:

 Insurance Company is not settling valid claim and making unnecessary

delay in payment.
5 Page
PRACTICE QUESTIONS

Q.1. Sangeetha filed a complain against a bank where her ornaments kept in the
bank’s locker were found missing and sought compensation through the
Consumers Disputes Redressal Forum against the deficiency in service by the
bank. The bank submitted a certificate recorded by the custodian of the bank
on the day Sangeetha had operated the locker which stated that all lockers
operated during the day had been checked and found properly locked. Will
Sangeetha succeed in her claim?

Ans. Yes, she will succeed in her claim. Bank is guilty for gross negligence.

Q.2. Girish, while taking a loan from a bank, gave FDR of his family friend Neena as
a guarantee against the loan received. The bank adjusted the said FDR amount
when Girish defaulted the loan repayment. Neena claimed return of money
from the bank contending that she is a third party and it was ‘deficiency in
service’ on the bank’s part. Will Neena Succeed?

Ans. Neena will not succeed. The present problem is similar to the case of
Mrs.Anumati V, Punjab National Bank, decided by the National Commission. In
this case, the National Commission held that there shall be no deficiency in
service where the bank takes conscious decision to adjust the fixed deposits of
the joint holders against the loan taken by a third party when the FDR has been
mortgaged as guarantee for loan.

Q.3. A CT scan machine is installed in Daya Ram Charitable Trust and Diagnostic
Centre. 80% of the patients are required to pay charges for the services
rendered by the trust whereas 20% patients are provided free services. On a
complaint against the trust for deficiency in service, it contended that the trust
did not engage in profit-making activity on a large scale. Will it succeed?

Ans. Daya Ram charitable Trust and Diagnostic Centre cannot claim to be consumer
under Section 2(d) of Consumer Protection Act, 1986 in view of the fact that
machinery was purchased for commercial purposes, every patient who takes
advantage of services of CT Scan Machine has to pay for it, services rendered are
not free, only 20% patients are provided free service. Thus machinery has been
used for commercial purposes and hence complaint can lie against the trust for
deficiency of service.

Q.4. Kajol purchased 2,000 units from a leading mutual fund in 1999 on monthly
income scheme. On maturity, the mutual fund sent account payee cheque
dated 1st September, 2005 in favour of Kajol at her address lodged with the
mutual fund through registered post. The registered post letter was not
returned undelivered and the mutual fund believed that the letter containing
6

the cheque was duly delivered to Kajol. On 19 th November, 2005, Kajol asked
Page

for payment of the maturity amount and was informed that the cheque was
 delivered and encashed through a co-operative bank. Kajol files a complaint
against the mutual fund for deficiency in service and seeks relief. Will she
succeed?

Ans. Kajol can claim refund of amount due on maturity for units purchased in a
Mutual Fund Scheme as there is failure on the part of Mutual fund to make the
payment due to Kajol. Mutual Fund can be held liable for deficiency in service.
Hence, Kajol will succeed in her action for deficiency of service.

Q.5. Rohit sought admission to a law college affiliated to EXCEL University. The
university refused to provide LL.B Degree Certificate to Rohit on completion of
the course on the ground that the qualifying examination on the basis of which
Rohit was admitted in the LL.B course in the college has not been recognized by
it. Rohit has filed a case in the Consumer Disputes Redressal Forum against the
university and claimed relief. Will Rohit Succeed?

Ans. It is deficiency in Service on part of Educational Institution. The case is similar to

(Case Law: Sreedhran Nair. V. Registrar, University of Kerala), the National
Commission observed that this is a clear case of deficiency on part of University.
A Compensation of Rs.50,000 was awarded to complainant.

Q.6. Define the term ‘service’ as contained in the Consumer Protection Act, 1986.
Are railway passengers and telephone subscribes ‘consumers’ under the
Consumer Protection Act, 1986?

Ans. Refer paragraph no. 4 for term ‘service’. Railway passengers and telephone
subscribers are consumers.

Q.7. Your father bought life insurance and placed you as the nominee. Due to an
unfortunate incident he passed away, entitling you to claim insurance. When
you approached the insurance company, they deny you the insurance based on
a technical error that they claim that your father made. Since your father
bought the insurance and paid the premiums himself and you are only a
nominee of the insurance claim, can you approach the consumer court?

Ans. Yes, Any beneficiary can approach to consumer court for violation of right of
consumer.

Consumers play a key role in maintaining the economy of India. Each and every person
constitutes a consumer because each one of us is engaged in some form of exchange of goods
or services through money as a medium. Gradually, there arise many kinds of disputes among
the consumers as well as consumers and the sellers. In this context, it has to be stated that
7

there lies a need for a statute which regulates the friction between the consumers and the
Page

sellers. For this purpose, Consumer Protection Act was enacted in the year 1986 to look after
the various rights and duties of the consumers during the time of purchasing a product and
even after that. The Act plays an important role in the fields where there arises an incidence of
exchange of goods or services between two persons where money acts as a medium. The Act
also provides certain guidelines as to what measures must be complied with during the time of
such exchange, what are the various rights available to both the buyer and seller etc. It also
provides certain provisions regarding the need and formulation of various ‘Consumer Redressal
Centres’ both at the central as well as states level.

The Act lays down certain provisions regarding the definition of consumer, various consumer
protection councils, and provisions in connection with various consumer redressal agencies in
India as well as other miscellaneous provisions. Among this, provisions relating to consumer
redressal agencies demand a lot of attention in the present Indian scenario. Many people are
still not aware that there are such agencies working in favor of consumers in every district. Due
to this reason, many of them are not getting proper solutions for their problems as consumers.
Chapter III of the Act provides for the implementation of redressal agencies. Section 9 of the
Act provides for ‘establishment of consumer dispute redressal agencies’ which include:

 A District forum/Commission established by the State Government in each district of the

State by its notification. Upto 1 cr

 A State Commission established by the State Government in each state by its

notification and upto 1 cr to 10 cr

 A National Commission established by Central Government by notification above 10 cr

8
Page
District Forum/commission

Each District Forum shall consist of a person who is or has been qualified as a District judge, as
the President. There must be two other persons who are not less than thirty-five years of age
and also possesses a degree from a recognized university. The persons must have adequate
knowledge in the field of economics, commerce, industry, public affairs, and administration.
The district forum must have the jurisdiction to entertain such complaints where the value of
goods or services and the compensation, does not exceed Rs. twenty lakhs. The need for district
forums for consumer redressal is that majority of the people who face any consumer rights
violation are unable to file a complaint in a state or national forum because such f have to look
at matters concerning various other district forums which result in a large number of pending
cases. District forums are also enabled with a faster way of dispensing consumer redressal as
the amount of claim is pretty less than that of State/National redressal forums which enables
normal people to seek a solution for their problems.

State Commission

Each State Commission shall consist of a person who is or has been a judge of High Court as its
president. The Commission also consists of not less than two members, who are above thirty-
9
Page

five years of age and also possesses a degree from a recognized university. The persons must
have adequate knowledge in the field of economics, commerce, industry, public affairs, and
administration. The Act also states that not less than fifty percent of the members shall be from
amongst the persons having a judicial background. The State Commission has a jurisdiction to
entertain cases where the value of goods or services or the compensation claimed, if any,
exceeds the number of Rs. twenty lakhs but does not exceed Rs. one crore. It also entertains
appeals against any District Forum within the state and also looks after any pending disputes or
cases decided by any of the District forums in which the forums have exercised a jurisdiction
not vested in them by the law, or has been exercised illegally or with any material irregularity.

National Commission

The National Commission shall consist of a person, who is or has been a judge of the Supreme
Court, to be appointed by the Central Government, shall be the President, provided that no
appointment shall be made except after the consultation with the Chief Justice of India. The
commission shall consist of not less than four members of its executive committee who shall
not be less than thirty-five years of age and must be graduates from a recognized university.
They must also be specialized in the areas of commerce, economics, and administration. The
jurisdiction of the commission shall extend to any case where the compensation amount might
exceed Rs. one crore and the Commission shall also entertain appeals against State
Commissions. The Commission also has the power to check any pending disputes or cases
decided by any of the State Commissions where the State Commission has exercised a
jurisdiction not vested in it by law or it has been exercised illegally or with any material
irregularity.

Power of redressal forums

There are various powers for all of the redressal forums with regards to its jurisdiction. Some of
10

them include:
Page
 1. Examining, enforcing as well as summoning the witness on oath;

2. Discovering and producing any material evidence;

3. Receiving evidence on affidavit;

4. Requesting for report or test analysis from the concerned authorities and laboratories;

5. Issuing commission for examining the witness;

6. Enforcing any other powers prescribed by the Central or State Government.

Limitation period

The District, State or National Forum for consumer grievance redressal will not entertain a case
which is filed two years after the occurrence of the case unless the party/parties can condone
themselves regarding the reasons behind the delay of filing within the specified period. Such a
provision was formulated to increase the accuracy of the function of such forums and also for
delivering fast redressal solutions to the parties.

Conclusion

From various landmark judgments by the Supreme Court in connection with cases affecting
consumer rights, it will be clear that there is an increase in the number of cases involving
consumer protection when compared to the past. It indicates that people are now aware of
their various rights as consumers. The Act not only covers the rights of the consumers but also
provides certain duties for them too. It has been stated that it is the duty of a consumer to ask
clearly about various characteristics and features of the product which he/she wishes to buy.
The Act does not entertain certain malicious acts such as black marketing and selling a good
above the prescribed rate of MRP. The doctrine of ‘caveat venditor’ (let the seller beware) has
been changed into ‘caveat emptor’ (let the purchaser beware) so that the purchaser will also be
aware of various features, merits and demerits of the good as well as protection of their rights
themselves. There is still an emerging need of various other redressal machineries in this field
due to the increased number of pending cases as well as for implementing alternative means in
the field of consumer protection. The Act may be amended in such a way that it includes certain
dispute redressal mechanisms like ‘Alternative Disputes Resolution’ as a core function of the
said redressal agencies dealing with consumer rights.
11
Page
"Act" means the Consumer Protection Act, 2019 (35 of 2019); (b) “e-commerce entity” means
any person who owns, operates or manages digital or electronic facility or platform for
electronic 2 commerce,but does not include a seller offering his goods or services for sale on a
marketplace e-commerce entity; (c) “grievance” includes any complaints to an e-commerce
entity regarding violations of the provisions of the Act and the rules made thereunder; (d)
“GSTIN”means the Goods and Services Tax Identification Number as under the Central Goods
and Services Tax Act, 2017 (12 of 2017); (e) “information” shall have the same meaning as to it
clause (v) of subsection (1) of section 2 of the Information Technology Act, 2000 (21 of 2000); (f)
“inventory e-commerce entity‖ means an e-commerce entity which owns the inventory of
goods or services and sells such goods or services directly to the consumers and shall include
single brand retailers and multi-channel single brand retailers; (g) “marketplace e-commerce
entity” means an e-commerce entity which provides an information technology platform on a
digital or electronic network to facilitate transactions between buyers and sellers; (h)
―PAN”means Permanent Account Number as under section 139A of the Income Tax Act, 1961
(43 of 1961); (i) “platform” means an online interface in the form of any software including a
website or a part thereof and applications including mobile applications; (j) “ranking” means
the relative prominence or relevance given to the goods or services offered through a
marketplace e-commerce entity as presented, organised or communicated by such entity,
irrespective of the technological means used for such presentation, organisation or
communication; (k) ―seller”means the product seller as defined in clause (37) of section 2 of
the Act and shall include any service provider; (l) “user” means any person who accesses or
avails any computer resource of an e-commerce entity. (2) The words and expressions used
herein and not defined, but defined in the Act or in the Information Technology Act, 2000 (21 of
2000) or the rules made thereunder shall have the same meaning as respectively assigned to
them in those Acts or rules.

4. Duties of e-commerce entities. –

- (1) An e-commerce entity shall: (a) be a company incorporated under the Companies Act,
1956 (1 of 1956) or the Companies Act, 2013 (18 of 2013) or a foreign company covered under
clause 3 (42) of section 2 of the Companies Act, 2013 (18 of 2013) or an office, branch or agency
outside India owned or controlled by a person resident in India as provided in sub-clause (iii) of
clause (v) of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999); and (b)
appoint a nodal person of contact or an alternate senior designated functionary who is resident
in India, to ensure compliance with the provisions of the Act or the rules made thereunder. (2)
Every e-commerce entity shall provide the following information in a clear and accessible
manner on its platform, displayed prominently to its users, namely:-- (a) legal name of the e-
12

commerce entity; (b) principal geographic address of its headquarters and all branches; (c)
Page

name and details of its website; and (d) contact details like e-mail address, fax, landline and
mobile numbers of customer care as well as of grievance officer. (3) No e-commerce entity shall
adopt any unfair trade practice, whether in the course of business on its platform or otherwise.
(4) Every e-commerce entity shall establish an adequate grievance redressal mechanism having
regard to the number of grievances ordinarily received by such entity from India, and shall
appoint a grievance officer for consumer grievance redressal, and shall display the name,
contact details, and designation of such officer on its platform. (5) Every e-commerce entity
shall ensure that the grievance officer referred to in sub-rule (4) acknowledges the receipt of
any consumer complaint within forty-eight hours and redresses the complaint within one
month from the date of receipt of the complaint. (6) Where an e-commerce entity offers
imported goods or services for sale, it shall mention the name and details of any importer from
whom it has purchased such goods or services, or who may be a seller on its platform. 4 (7)
Every e-commerce entity shall endeavour on a best effort basis to become a partner in the
convergence process of the National Consumer Helpline of the Central Government. (8) No e-
commerce entity shall impose cancellation charges on consumers cancelling after confirming
purchase unless similar charges are also borne by the e- commerce entity, if they cancel the
purchase order unilaterally for any reason. (9) Every e-commerce entity shall only record the
consent of a consumer for the purchase of any good or service offered on its platform where
such consent is expressed through an explicit and affirmative action, and no such entity shall
record such consent automatically, including in the form of pre-ticked checkboxes. (10) Every e-
commerce entity shall effect all payments towards accepted refund requests of the consumers
as prescribed by the Reserve Bank of India or any other competent authority under any law for
the time being in force within a reasonable period of time, or as prescribed under applicable
laws.

(11) No e-commerce entity shall—

(a) manipulate the price of the goods or services offered on its platform in such a manner as to
gain unreasonable profit by imposing on consumers any unjustified price having regard to the
prevailing market conditions, the essential nature of the good or service, any extraordinary
circumstances under which the good or service is offered, and any other relevant consideration
in determining whether the price charged is justified;

(b) discriminate between consumers of the same class or make any arbitrary classification of
consumers affecting their rights under the Act.

5. Liabilities of marketplace e-commerce entities. –

(1)A marketplace e-commerce entity which seeks to avail the exemption from liability under
13

sub-section (1) of section 79 of the Information Technology Act, 2000 (21 of 2000) shall comply
Page

with subsections (2) and (3) of that section, including the provisions of the Information
Technology (Intermediary Guidelines) Rules, 2011. (2) Every marketplace e-commerce entity
shall require sellers through an undertaking to ensure that descriptions, images, and other
content pertaining to goods or services on their platform is accurate and corresponds directly
with the appearance, nature, quality, purpose and other general features of such good or
service. 5 (3) Every marketplace e-commerce entity shall provide the following information in a
clear and accessible manner, displayed prominently to its users at the appropriate place on its
platform: (a) details about the sellers offering goods and services, including the name of their
business, whether registered or not, their geographic address,customer care number, any
rating or other aggregated feedback about such seller, and any other information necessary for
enabling consumers to make informed decisions at the pre-purchase stage: Provided that a
marketplace e-commerce entity shall, on a request in writing made by a consumer after the
purchase of any goods or services on its platform by such consumer, provide him with
information regarding the seller from which such consumer has made such purchase, including
the principal geographic address of its headquarters and all branches, name and details of its
website, its email address and any other information necessary for communication with the
seller for effective dispute resolution. (b) a ticket number for each complaint lodged through
which the consumer can track the status of the complaint; (c) Information relating to return,
refund, exchange, warranty and guarantee, delivery and shipment, modes of payment, and
grievance redressal mechanism, and any other similar information which may be required by
consumers to make informed decisions; (d) information on available payment methods, the
security of those payment methods, any fees or charges payable by users, the procedure to
cancel regular payments under those methods, charge-back options, if any, and the contact
information of the relevant payment service provider; (e) all information provided to it by
sellers under sub-rule (5) of rule 6; and (f) an explanation of the main parameters which,
individually or collectively, are most significant in determining the ranking of goods or sellers on
its platform and the relative importance of those main parameters through an easily and
publicly available description drafted in plain and intelligible language

6. Duties of sellers on marketplace. –

(1)No seller offering goods or services through a marketplace e-commerce entity shall adopt
any unfair trade practice whether in the course of the offer on the e-commerce entity’s
platform or otherwise. (2) No such seller shall falsely represent itself as a consumer and post
reviews about goods or services or misrepresent the quality or the features of any goods or
services. (3) No seller offering goods or services through a marketplace e-commerce entity shall
refuse to take back goods, or withdraw or discontinue services purchased or agreed to be
purchased, or refuse to refund consideration, if paid, if such goods or services are defective,
14

deficient or spurious, or if the goods or services are not of the characteristics or features as
Page

advertised or as agreed to, or if such goods or services are delivered late from the stated
delivery schedule: Provided that in the case of late delivery, this sub-rule shall not be applied if
such late delivery was due to force majeure. (4) Any seller offering goods or services through a
marketplace e-commerce entity shall: (a) have a prior written contract with the respective e-
commerce entity in order to undertake or solicit such sale or offer; (b) appoint a grievance
officer for consumer grievance redressal and ensure that the grievance officer acknowledges
the receipt of any consumer complaint within forty-eight hours and redresses the complaint
within one month from the date of receipt of the complaint; (c) ensure that the advertisements
for marketing of goods or services are consistent with the actual characteristics, access and
usage conditions of such goods or services. (d) provide to the e-commerce entity its legal name,
principal geographic address of its headquarters and all branches, the name and details of its
website, its e-mail address, customer care contact details such as fax, landline, and mobile
numbers and where applicable, its GSTIN and PAN details.

(2) The District Commission or the State Commission, as the case may be, shall credit the amount of fee
received by it under sub-rule (1) to the Consumer Welfare Fund of the State and where such Consumer
Welfare Fund is not established, into the appropriate account of the State Government, and the
National Commission shall credit such amount of fee received by it to the Consumer Welfare Fund of the
Central Government.

Table

Sl. No . Value of goods or services paid as consideration Amount of fee payable

(1) (2) (3) District Commission (1) Upto rupees five lakh Nil

(2) Above rupees five lakh and upto rupees ten lakhs Rs.200

(3) Above rupees ten lakh and upto rupees twenty lakhs Rs 400

(4) Above rupees twenty lakh and upto rupees fifty lakh rupees Rs.1000

(5) Above rupees fifty lakh and upto rupees one crore Rs.2000 State Commission

(6) Above rupees one crore and upto rupees two crore Rs.2500

(7) Above rupees two crore and upto rupees four crore Rs.3000

(8) Above rupees four crore and upto rupees six crore Rs.4000

(9) Above rupees six crore and upto rupees eight crore Rs.5000
15

(10) Above rupees eight crore and upto rupees ten crore Rs.6000 National Commission
Page
(11) Above rupees ten crore Rs.7500 8. Manner of filing complaints electronically. —The electronic filing
of complaints in National Commission, State Commission and District Commission shall be effective from
such date and for such category of cases as may be notified by the President of the National Commission
from time to time.

The Ministry of Consumer Affairs, Food and Public distribution, has issued a
notification by which it appoints the July 20, 2020 as the date on which the
Consumer Protection Act, 2019 shall come into force.

The following provision of the act shall come into force:

Section 2 [Except clauses (4), (13), (14), (16), (40)] [Definitions]

Sections 3 to 9 (both inclusive); [Consumer Protection Councils]

Sections 28 to 73 (both inclusive); [Except sub-clause (iv) of clause (a) of sub-

section (1) of section 58.] [Consumer Disputes Redressal Commission]

Sections 74 to 81 (both inclusive); [Mediation]

Sections 82 to 87 (both inclusive); [Product Liability]

Sections 90 and 91; [Except sections 88, 89, 92 & 93] [Offences and
Penalties]

Sections 95, 98, 100, -Section101 [Except clauses (f) to (m) and clauses (zg),
(zh) and (zi) of sub –section 2] [Miscellaneous]

Sections 102, 103, 105, 106, 107 [Except sections 94, 96, 97, 99,
104] [Miscellaneous]

The Consumer Protection Act, 2019 (the Act) received the President’s assent on
16

9 August 2019 which has replaced the Consumer Protection Act, 1986.
Page
 The scope of the Act has been broadened by introduction of various provisions
including e-commerce within its purview. The Act aims at protecting and
strengthening the rights of the consumers by establishing authorities, imposing
strict liabilities and penalties on product manufacturers, electronic service
providers, misleading advertisers, and by providing additional settlement of
consumer disputes through mediation.

There are structural changes in the Consumer Courts in number of members,

honorarium, and staff cadre. Procedural changes are there like to give notice
with different mode and on legal issues the changes are made like giving review
powers.

 consumer protection councils, consumer disputes redressal forum, mediation,

liability of services or products, the penalty for manufacturing, selling,
distributing etc spurious good or products
 Government yet to notify provisions related to e-commerce, direct selling and
formation of an apex Central Consumer Protection Authority at the national
level
 The Consumer Protection Bill, 2019, received assent from President Ram
Nath Kovind on August 9. It will come into effect on July 20, 2020
New Delhi: The government has notified most provisions of the Consumer
Protection Act, 2019, which will come into force on July 20. With the
consumers’ peace of mind in focus, the new law will ensure that complaints
can be filed at a district or state consumer commission from the location
where the complainant resides rather than from where the service or product
was bought.
The provisions notified by the government are related to consumer protection
councils, consumer disputes redressal forum, mediation, the liability of
services or products, the penalty for manufacturing, selling, distributing etc
spurious good or products which contain adulterant.
The new provisions will enable the consumers to drag to court if
manufacturers, sellers or distributors are found dealing with adulterated and
17

spurious products. They can also file complaints in consumer commissions

claiming compensation for the spurious or adulterated product from the
Page

consumer. Giving real teeth to courts against such errant businesses, under
the provisions of the Consumer Protection Act, 2019 which come into effect
Monday, they can be awarded up to 6 months in jail or a fine of up to Rs 1
lakh in cases where the consumer is not injured.
In cases where the consumer is injured, the fine to the manufacturer, seller or
distributor could be upto Rs 5 lakh and upto seven years in jail. If the case
pertains to the death of the consumer then a minimum fine of Rs 10 lakh and
seven years in jail which may be extended to life imprisonment can be
imposed.

consumer Protection Act, 2019 notified with effect from 20 July 2020.
The main features of The Consumer Protection Act, 2019 are as follows:-
1. District forum is renamed as District Commission
2. The Opposite Party needs to deposit 50% of the amount ordered by the District
Commission before filing an appeal before State Commission, earlier the ceiling was of a
maximum of Rs. 25,000/-, which has been removed.
3. The limitation period for filing an appeal to the State Commission is increased from 30 days to
45 days while retaining the power to condone the delay.
4. State Commission shall have a minimum of 1 President and 4 Members
5. The original pecuniary jurisdiction of
District Commission shall be until Rs. 1 Crore,
State Commission from 1 Cr – 10 Cr. And
NCDRC to be more than Rs. 10 crore
6. Now complainant can also institute the complaint within the territorial jurisdiction of the
Commission where the complainant resides or personally works for gain besides what was
provided earlier
7. Section 49(2) and 59(2) of the new act gives power to the State Commission and NCDRC
respectively to declare any terms of the contract, which is unfair to any consumer, to be null and
void.
8. A second appeal to NCDRC has been provided U/s 51(3) if there is a substantial question of
law involved in the matter
9. The power of revision can still be exercised by NCDRC U/s 58(1)(b) and by State commission
under 47(1)(b) of the Act.
10. Power of review has been conferred to District Commission, State Commission and NCDRC
U/s 40, 50 and 60 of the Act respectively
11. NCDRC can hear appeals against the order of Central Authority by virtue of Section 58 of
the Act
12. Period of limitation in the filing of complaint remains 2 years with a provision for
18

condonation of delay power U/s 69 of the Act

13. Section 70 provides for administrative control of State Commission over the District
Page

Commission and that of NCDRC over State Commission. It inter alia provides for an
investigation into any allegations against the President and members of a State Commission /
District Commission and submitting inquiry report to the State Government concerned along
with copy endorsed to the Central Government for necessary action
14. Section 71 confers the power of execution as provided Under Order XXI, The Code of Civil
Procedure, 1908 with such limitation as provided in the section
15. Mediation is given statutory status by way of introduction of Section 74 in the new Act
16. A product liability action may be brought by a complainant against a product manufacturer or
a product service provider or a product seller, as the case may be, for any harm caused to him on
account of a defective product.
17. Chapter III of the Act provides for the creation of Central Authority to regulate matters
relating to a violation of rights of consumers, unfair trade practices and false or misleading
advertisements which are prejudicial to the interests of public and consumers and to promote,
protect and enforce the rights of consumers as a class
18. The Central Authority shall have an Investigation Wing headed by a Director-General for the
purpose of conducting inquiry or investigation under this Act as may be directed by the Central
Authority
19. The Act of 2019 has come into effect w.e.f. 9.8.19 and old Act of 1986 stands repealed,
subject to section 1(3) of the New Act.
20. Rules regarding the appointment, conditions of service, etc. of the Members are to be notified
soon.

For consumers here is good news amidst the coronavirus (COVID-19) pandemic. The new
Consumer Protection Act, that has provisions to deal with class actions, product liability,
misleading advertisements and liability for celebrity endorsements, while addressing new age
developments like e-commerce, direct selling and tele-marketing, will come into force from 20
July 2020.

With the new law,

1.district commission are empowered to handle consumer cases with claims of up to Rs1 crore.
2.State commission will handle cases with claims of between Rs1 crore and Rs10 crore while
the 3.National Consumer Disputes Redressal Commission (NCDRC) will handle all cases above
Rs10 crore.

Most importantly, with the new Act, any terms of a contract that are not fair to any consumer,
can be declared as null and void by the state commission and NCDRC. This will help many
consumers who are victims of one-sided agreements or terms and conditions imposed by the
19

seller.
Page
In addition, a consumer can take action about product liability against the product
manufacturer or product service-provider or product seller, as the case may be, for any harm
caused to him due to defective product. Till now, product-service provider or seller used to get
away by putting the entire blame for defective product on the manufacturer. This new
provision will help control mainly online sellers.

While provisions relating to constitution and powers of central consumer protection council
(CCPC) are not included in the notification, the rules on composition of the central council and
its term have been notified.

The main features of The Consumer Protection Act,

2019 are as follows.

1. District forum is renamed as district commission.

2. The opposite party needs to deposit 50% of the amount ordered by district commission
before filing appeal before state commission. Earlier, the ceiling was of maximum of Rs25,000
which has been removed.

3. The limitation period for filing of appeal to state commission is increased to 45 days from 30
days, while retaining power to condone the delay.
20
Page

4. State commission shall have a minimum of one president and four members
5. The original pecuniary jurisdiction of district commission will be up to Rs1 crore, state
commission from Rs1 crore to Rs10 crore and the NCDRC above Rs10 crore.

6. Complainant can institute the complaint within the territorial jurisdiction of the commission
where the complainant resides or personally works for gain besides what was provided earlier.

7. Section 49(2) and 59(2) of the new act gives power to the state commission and NCDRC
respectively to declare any terms of contract, which is unfair to any consumer, to be null and
void.

8. A second appeal to NCDRC has been provided under section 51(3) if there is a substantial
question of law involved in the matter.

9. Power of revision can still be exercised by NCDRC under Section 58(1)(b) and by State
commission under Section 47(1)(b) of the Act.

10. Power of review has been conferred to district commission, state commission and NCDRC
under Section 40, 50 and 60 of the Act, respectively.

11. NCDRC can hear appeals against the order of central authority by virtue of Section 58 of the
Act.

12. Period of limitation in filing of complaint remains two years with a provision for
condonation of delay power under Section 69 of the Act.
21

13. Section 70 provides for administrative control of state commission over district commission
Page

and that of NCDRC over state commission. It inter alia provides for investigation into any
allegations against the president and members of a state commission / district commission and
submitting inquiry report to the state government concerned along with copy endorsed to the
central government for necessary action.

14. Section 71 confers power of execution as provided under order XXI, the code of civil
procedure (CPC), 1908 with such limitation as provided in the section.

15. Mediation is given statutory status by way of introduction of Section 74 in the new Act.

16. A product liability action may be brought by a complainant against a product manufacturer
or a product service provider or a product seller, as the case may be, for any harm caused to
him on account of a defective product.

17. Chapter III of the Act provides for creation of central authority to regulate matters relating
to violation of rights of consumers, unfair trade practices and false or misleading
advertisements, which are prejudicial to the interests of public and consumers and to promote,
protect and enforce the rights of consumers as a class.

18. The central authority will have an investigation wing headed by a director general for the
purpose of conducting inquiry or investigation under this Act as may be directed by the central
authority.

22
Page