A Project Report of IA2

on
Cunsumer protection act, 2019

Subject : Legal aspects of business

Submitted By:
Sanvi Srivastava
Sanyam Pal
Shivam Singh
Shivangi
Shubham Sandilya
Vivek Dubey

Under the Guidance of:

Prof. Savneet Kaur
 School of Business

Certificate
This is to certify that, Group-10 of MBA Sem-1, Sec-11 has successfully
completed the project titled consumer protection act,2019 under my guidance
for the Academic Year 202324. The information submitted is true and original
as per my knowledge.

Prof. Miss Savneet kaur

(Course Guide)
 ACKNOWLEGEMENT

To list who all have helped us is difficult because they are so

numerous and the depth is so enormous.
We would like to acknowledge the following as being idealistic
channels and fresh dimensions in the completion of this project
We take this opportunity to thank the Galgotias Universityforgiving
us chance to do this project.
We would like thank ourPC Ma”am, Mrs. Shilpa Bahl for providing
the necessary facilities required for completion of this project.
We would also like to express our sincere gratitude towards my
project guide Prof. Miss.Savneet kaur whose guidance and care
made the project successful.
We would like to thank college library, for having provided Various
reference books and magazines related to our project.
Lastly we would like to thank each & every person who directly or
indirectly helped us in completion of the project especially our
parents & peers who supported us throughout our project.
 Table of Content

Title Page

Introduction

Defination

Objectives of consumer protection act

Consumer rights under consumer protection act

Unfair trade practices

Misleading advertisment

Role and power of consumer council

Function and duties of central authority

E-Consumer

Real life example of services, deficiency in

services and defects

Case related to consumer law

Conclusion

INTRODUCTION
The Consumer Protection Act of 2019 is an Indian legislation aimed at safeguarding the
rights of consumers and providing a framework for the protection of their interests. It
replaced the earlier Consumer Protection Act of 1986, aiming to address contemporary
challenges in consumer protection. This act focuses on enhancing consumer rights,
establishing mechanisms for quicker redressal of consumer grievances, and introducing
stringent measures against unfair trade practices and misleading advertisements. It also
establishes Consumer Dispute Redressal Commissions at the district, state, and national
levels to handle consumer complaints efficiently. The Consumer
Protection Act of 2019 in India is designed to strengthen consumer rights, expedite
grievance redressal, combat unfair trade practices, and regulate misleading advertisements.
It establishes various levels of Consumer Dispute Redressal Commissions for swift resolution
of consumer complaints and aims to provide greater protection and empowerment to
consumers in the marketplace.

The Consumer Protection Act, 2019 was introduced in the Lok Sabha as a replacement of
COPRA, 1986 on 8 July 2019 by the Minister of Consumer Affairs, Food and Public
Distribution, Ram Vilas Paswan.[1] It was passed by Lok Sabha on 30 July 2019[2] and later
passed in Rajya Sabha on 6 August 2019

DEFINATION
CONSUMER
Section 2(7) of the act defined, Consumer is an individual who purchases goods or services
for personal use or consumption and not for resale or commercial purposes. In the context
of consumer protection laws, a consumer is someone who buys products or utilizes services
for their own use, which may include tangible goods, services, utilities, or digital products.

Consumer for goods

As per section 2 (7) (i) consumer means any person who- 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 .

Consumer for services

As per section 2 (7) (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 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, when such services are availed of with the approval of the
first-mentioned person.

Who is a not a consumer?

• A person who obtains;

• goods free of charge

• who avails services free of charge

• who obtains goods for resale or for any commercial purposes

• who avails services for any commercial purposes

• who avails services under contract of service

SERVICES
Service refers to an intangible action, performance, or assistance provided by one party to
another. In a business context, services are activities, efforts, or tasks performed to fulfill a
particular need or desire of a customer or client, often involving skill, expertise, or labor.

Service is an intangible benefit availed by the consumer from the service provider. On a
daily basis, we all humans hire different services. Term service is defined under Section 2(42)
of the Consumer Protection Act, 2019, which include facilities related to banking, financing,
insurance, telecom, processing, transport, etc. Service doesn’t include any free service, it
should be in paid form.

Illustrations:

 Legal consultation is a service where a lawyer is a service provider.

 A medical check-up is a service where a doctor is a service provider.
 Teaching is a service where the teacher is a service provider.
 Internet facility is a service.

DEFICIENCY IN SERVICES
 According to Section 2(11) of the Consumer Protection Act 2019 (“the Act”),
deficiency is any sort of fault, imperfection, shortcoming or defect in the feature,
quality, amount, nature, worth, authenticity, capacity and standard which is
obligatory to be maintained and regulated as per the laws and statutes in function or
any agreement/contract claimed by the seller, with respect to the products and
goods. Including any act of negligence, omission or commission by the seller which
causes loss to the consumer, which a prudent seller is supposed to do or is supposed
to omit, but deliberately does the contrary, such actions amount to ‘deficiency of
service’. These definitions help to understand the clear meaning of deficiency in
services. Whenever there is any sort of deficiency in services, the customer is
exploited which impacts and causes loss of money. Any kind of negligence or
omission or commission can cause injury to consumers.
 Any act of negligence or omission or commission by such person which causes loss or
injury to the consumer; and
 Deliberate withholding of relevant information by such person to the consumer.

DEFECTS
Defect: Defect means any fault, imperfection or shortcoming in the quality,

quantity, potency, purity or standard which is required to be maintained by or

under any law for the time being in force or under any contract, express or

implied or as is claimed by the trader in any manner whatsoever in relation to

any goods. [Sec. (2) (1) (f

OBJECTIVES OF CONSUMER PROTECTION ACT 2019

The primary objectives of the Consumer Protection Act are to safeguard the rights of
consumers by:

1. Enhancing Consumer Welfare And Rights

One of the core objectives of the Consumer Protection Act, 2019 is to prioritize
consumer welfare and rights. The act intends to ensure that consumers have the
right to be protected against marketing of goods and services that are hazardous to
their life and property. It emphasizes the right to be informed, right to choose, right
to be heard, and the right to seek redressal in case of grievances. The act aims to
strengthen consumer awareness and education, empowering them to make
informed decisions.

2. Establishing Mechanism A Redressal

The act focuses on establishing an efficient and effective redressal mechanism for consumer
complaints. It establishes the Consumer Disputes Redressal Commissions at various levels
District, State, and National to provide consumers with a platform to seek remedies for

unfair trade practices and deficiencies in goods and services. This multi-tiered structure
ensures that consumers have access to a speedy resolution of their disputes.

3. Combating Unfair Trade Practices

One of the critical objectives of theConsumer Protection Act, 2019 is tocombat unfair trade
practices. Theact introduces stricter penalties formisleading advertisements, false claims,
and other deceptive practices by businesses. It aims to create a level playing field in the
market by discouraging unethical business conduct and promoting competition.

4. E-Commerce Regulation
With the proliferation of e-commerce, the act recognizes the need to regulate online
transactions and protect consumers in the digital space. It introduces provisions that govern
e-commerce entities, ensuring transparency, proper information disclosure, and
accountability in online transactions. This objective aligns with the changing consumer
behavior and the increasing significance of online commerce.

5. Product Liability
The act introduces the concept of product liability, holding manufacturers, sellers, and
service providers accountable for any harm caused to consumers due to defective products
or deficient services. This objective aims to enhance product safety and quality, encouraging
businesses to ensure that their offerings meet the necessary standards and do not pose risks
to consumers.

6. Promoting Consumer Education And Awareness

Recognizing the importance of informed consumers, the Consumer Protection Act, 2019
places an emphasis on promoting consumer education and awareness. It encourages
government bodies, consumer organizations, and businesses to collaborate in spreading
knowledge about consumer rights, responsibilities, and available remedies. This objectives
aims to empower consumers to make prudent choices and avoid falling victim to unfair
trade practices.

7. Alternate Dispute Resolution

The act encourages the adoption of alternate dispute resolution mechanisms such as
mediation and negotiation for resolving consumer disputes. This objective aims to provide a
quicker and cost-effective way of resolving conflicts without the need for prolonged legal
proceedings. It promotes the idea of resolving disputes amicably, benefiting both consumers
and businesses.

8. Stringent Penalties Enforcement

To ensure the effectiveness of the new consumer protection regime, the act lays down
stringent enforcement mechanisms and penalties for violations. It empowers regulatory
authorities to take necessary ar against businesses that engage in unfair trade practices act
as a detergent, discouraging businesses from exploiting consumers.

CUNSUMER RIGHTS UNDER CUNSUMER PROTECTION ACTS, 2019

The Consumer Protection Act of 2019 in India recognizes six fundamental
consumer rights:

1: Right to Safety: Consumers have the right to protection against goods and services
that are hazardous to health or life. This includes access to information about the risks
associated with products

Before purchasing, consumers should insist on the quality of the products as well as on the
guarantee of the products and services. They should preferably purchase quality marked
products such as ISI, AGMARK, etc.

2. Right to Information: Consumers have the right to be informed about the quality,
quantity, potency, purity, standard, and price of goods or services to make informed
decisions.

Consumer should insist on getting all the information about the product or service before
making a choice or a decision. This will enable him to desisit from falling prey to high
pressure selling techniques.

3. Right to be assured: The consumer has the freedom to access variety of products at
competitive prices. Thisimplies that the marketers should offer a wide variety of products in
terms of quality, brand, prices, size, etc. and allow the consumer to make a choice from
amongst these.
4. Right to be heard: The consumer has a right to file a complaint and to be heard in case
of dissatisfaction with a good or a service. It is because of this reason that many enlightened

business firms have set up their own consumer service and grievance cells. Many consumer
organisations are also working towards this direction and helping consumers in
redressal of their grievances.

5. Right to Redressal: Means right to seek redressal against unfair trade practices or
unscrupulous exploitation of consumers. It also includes right to fair settlement of the

genuine grievances of the consumer .

Consumers must make complaint for their genuine grievances.Many a times their
complaint may be of small value but its impact on the society as a whole may be very
large. They can also take the help of consumer organisations in seeking redressal of
their grievances

6. Right to Consumer Education: Consumers have the right to acquire knowledge

and skills to make informed choices, access information, and be aware of their rights and
responsibilities.

These rights aim to empower consumers, promote fair trade practices, and ensure their

well-being in the marketplace by providing mechanisms for seeking redressal and

fostering awareness and education about consumer rights and responsibilities .
PUNISHMENTS FOR CONSUMER RIGHTS VIOLATION
 Fine up to one lakh with imprisonment up to six months if no injury is caused
(applicable only in case of adulterated products)
 Fine up to three lakh with imprisonment up to three years if injury not resulting in
grievous hurt is caused. Grievous hurt carries the same meaning as assigned under
s.320 of the IPC.[18]
 Fine up to five lakh with imprisonment up to seven years if grievous hurt is caused.
 Fine up to ten lakh with minimum imprisonment for seven years which may extend
to imprisonment for life if death is caused.
UNFAIR TRADE PRACTICES UNDER CONSUMER PROTECTION
ACT,2019
The Consumer Protection Act, 2019, outlines various unfair trade practices to protect

consumers' rights. Some of these unfair trade practices include :

1. False Representation: Making false or misleading claims about the nature, quality, or
standard of goods or services.

2. False Advertisement: Presenting false or misleading advertisements regarding the

products or services.

3. Unfair Contract Terms: Including unfair or biased terms in contracts, which puts
consumers at a disadvantage.

4. Refusal of After-Sales Service: Denying consumers access to after-sales services or

warranties they are entitled to.

5. Charging Excessive Prices: Charging a price higher than the set limit or the market
value of the product or service.

6. Hoarding or Black Marketing: Creating artificial scarcity of goods or services to

manipulate prices.

7. Withholding Information: Deliberately withholding information about the product or

service that could affect consumer decisions.

These unfair trade practices are prohibited under the Consumer Protection Act to safeguard
consumers from exploitation and ensure fair dealings between consumers and businesses
 MISLEADING ADVERTISEMENT
Misleading advertisement in relation to any product or service, means an advertisement,
which-

(1) Falsely describes such product or service; or

(2) Gives a false guarantee to, or is likely to mislead the consumers as to the nature,
substance, quantity or quality of such product or service; or

(3) Conveys an express or implied representation which, if made by the manufacturer or

seller or service provider thereof, would constitute an unfair trade practice; or

(4) Deliberately conceals important information ;.

ROLE AND POWER OF CUNSUMER COUNCIL UNDER THE ACT,2019

The role of a Consumer Council, as outlined in various consumer protection acts, is primarily
to safeguard consumer rights and interests. In the context of the Consumer Protection Act

of 2019 , such councils typically have several key powers and responsibilities :

1. Advocacy and Education: Consumer councils often educate consumers

about their rights, responsibilities, and redressal mechanisms available to them in
case of grievances. They may conduct awareness campaigns, seminars, and
workshops to inform the public.

2. Complaint Handling: They receive, investigate, and take action on consumer

complaints against unfair trade practices, defective products, or poor services. They act as
mediators between consumers and businesses to resolve disputes.

3. Policy Recommendations: These councils can propose policy changes and

recommendations to enhance consumer protection laws and regulations. They might work
closely with government bodies to influence and shape consumer-friendly policies.
4. Monitoring and Enforcement: They monitor market trends, products, and services to
ensure compliance with consumer protection laws. They may have the authority to impose
penalties or take legal action against businesses violating these laws.

5. Consumer Representation: They represent consumer interests in various forums,

including governmental or industry consultations, advocating for fair pricing, quality
standards, and ethical business practices.`

FUNCTION AND DUTIES OF CENTRAL AUTHORITY UNDER THE ACT

2019
Under the Consumer Protection Act of 2019, the Central Authority is a pivotal body
responsible for several key functions and duties aimed at ensuring consumer protection and
welfare. Here are the main functions and duties of the Central Authority:

1. Administration and Implementation: The Central Authority administers and

implements the provisions of the Consumer Protection Act. It oversees the effective
execution of the law's objectives at the national level..

2. Policy Formulation: It formulates policies and guidelines related to consumer rights,

including the establishment of standards for goods and services, ensuring fair trade
practices, and promoting consumer awareness.

3. Consumer Dispute Redressal:The Central Authority facilitates consumer dispute

redressal mechanisms, such as setting up Consumer Dispute Redressal Commissions at
various levels - district, state, and national. It ensures their proper functioning and
adherence to legal procedures.
4. Consumer Awareness and Education: It undertakes initiatives to educate
consumers about their rights, responsibilities, and available redressal mechanisms. This
includes organizing campaigns, workshops, and disseminating information through various
media channels.

5 .Monitoring and Enforcement: The Central Authority monitors market trends,

investigates consumer complaints, and enforces consumer protection laws. It may take legal
action against businesses engaging in unfair trade practices or violating consumer rights.

6. Coordination and Collaboration: It coordinates with other government bodies,

consumer organizations, and stakeholders to enhance consumer protection measures.
Collaborations might include partnerships with industry bodies or international
organizations to improve consumer safety and rights.

7. Research and Analysis: It conducts studies, research, and analysis on emerging

consumer issues, market dynamics, and trends to better understand and address the
challenges faced by consumers.

E-CONSUMERS
"E-consumer" typically refers to a consumer who engages in transactions, purchases, or
interactions through electronic means, such as the internet, mobile applications, or other
digital platform

PROVISION FOR E-COMMERCE

1. Information disclosure
2. Right to redress
3. Data privacy and security
4. Transparent and secure payment
5. Dispute resolution
Intention of the Parliament behind enacting the Act

:
1. Protecting E-Consumer Rights Parliament aims to ensure that consumers
engaging in online transactions have similar rights and protections as those
purchasing goods or services through traditional means. This involves safeguarding
e-consumers' rights to accurate information, fair treatment, redress in case of
disputes, and protection of personal data.
 1. Adapting to Technological Advancements: Recognizing the changing
landscape of commerce, lawmakers intend to adapt legislation to keep pace with
technological advancements. The inclusion of provisions for e-consumers aims to
address the unique challenges and risks associated with online transactions, such as
data security, fraudulent practices, and ensuring trust in online marketplaces.

2. Promoting Confidence in Online Transactions: By establishing regulations

specific to e-commerce, the Parliament aims to enhance consumer confidence in
online shopping. Clear rules and protections for e-consumers can foster trust,
encourage more participation in online markets, and ultimately contribute to the

growth of the digital economy .

3. Addressing Challenges of Cross-Border Transactions: With the global

nature of online commerce, Parliament's intentions might also include addressing
challenges related to cross-border transactions, harmonizing rules for international
trade, and ensuring consistent consumer protections regardless of the geographical
location of the buyer or seller.

4. Encouraging Responsible Business Practices: The inclusion of e-consumer

provisions often serves to encourage responsible business conduct among online
sellers and platforms. This could involve setting standards for transparency, fair
practices, and ethical behavior in online commerce.

REAL LIFE EXAMPLE OF

 SERVICES
 A real-life example of a service is a ride-sharing platform like Uber, where
users can request transportation services through a mobile app, and drivers
provide the service by picking them up and taking them to their destination.
  Another example of a service is a streaming platform like Netflix, where users
subscribe to access a vast library of movies and TV shows for on-demand
streaming. The service provides entertainment content to users over the
internet.
 DEFICIENCY IN SERVICES
 Inappropriate treatment done by a doctor leading to an
increase in patient’s suffering is the deficiency in service.
 A customer buys a ticket for an AC bus. But the AC of the
bus does not work, which is a deficiency of service.
 DEFECTS IN SERVICES
 Software with bugs that has to be re-coded
 Misdiagnoses in healthcare that lead to unnecessary tests
or treatment
 Products that are shipped to the wrong address
 Manufactured items that don't meet the customer's
specifications
 Incorrect data entry
 Information that isn't communicated effectively or well
understood

CASE.

1. Manjeet Singh Vs. National Insurance Company Ltd. & Anr:

FACTS
In this case, the appellant had purchased a second - hand truck under a Hire Purchase
agreement. The vehicle was insured by the respondent insurance company. One day when
he was driving the truck, a passenger asked him to stop the truck and give him a lift. When
he stopped the truck, the passenger brutally assaulted the driver and fled with the vehicle.
An FIR was lodged and the respondent finance company was intimated about the theft.
However, the insurance company rejected the claim on the ground of breach of terms of the
policy. The complainant approached District Consumer Disputes Forum, State Commission
and National Commission to compensate him for the loss. All of them had rejected the case.
So, finally he approached the Supreme Court.

ISSUE
The insurance company contended that the driver of the truck had violated the terms of the
policy by providing a lift to the passengers, and as a result, there was breach of policy and
the insurance company was not liable. The District Forum accepted this contention and
rejected the claim of the owner-complainant. The District Forum also rejected the claim on
the ground that the arbitration proceedings had been initiated by the finance company
against the complainant and they were at the final stage. The claimant then filed an appeal
before the State Consumer Disputes Redressal Commission and this appeal was also denied
and then the claimant filed revision before the National Consumer Disputes Redressal
Commission but it was also rejected. Finally, he filed an appeal to the Supreme Court.

JUDGEMENT
The Supreme Court held that the appellant was not at all in fault. It can be considered as a
breach of the policy, but not a fundamental breach to bring the insurance policy to an end
and terminate the insurance policy. The two - judge bench of Supreme Court directed the
respondent insurance company to pay 75% of the insured amount along with 9% interest
p.a. from the date of filing the claim. The court also directed the insurance company to
paysum of Rs. 1,00,000 as compensation.

CASE RELATED TO DEFICIENCY IN SERVICES

2. AMITABH DASGUPTA VS UNITED BANK OF INDIA

FACT
The case had gone into appeal. The appellant's Mother took a locker on rent in the
Deshapriya Park, Kolkata Branch of the respondent bank. The appellant/complainant was
included as a joint holder of the locker. The appellant visited the respondent bank to
operate the locker and deposit the locker rent. However, the appellant was informed that
the bank had broken open his locker for non-payment of rent dues. Further, that the locker
had subsequently been reallocated to another customer. When the appellant went to
collect the contents of the locker, he found only two of the seven ornaments that had been
deposited in the locker in a non-sealed envelope. However, the respondent bank contended
that only those two ornaments were found in the appellant's locker when it was broken
open. That the same is evident from the inventory prepared by the respondent. When the
locker was broken open in the presence of an independent witness. Subsequently, the
appellant filed a consumer complaint before the District Consumer Forum.

JUDGEMENT
Furthermore, on appeal, the Supreme Court issued guidelines on allotting and operating of
lockers and the court held that banks will be liable under the Consumer Protection Act for
deficiencies in locker services. In the light of these case laws, we can see that the issue of
deficiency in services has mostly been interpreted by the courts in the favour of consumers
and high significance has been attached with the kind of services that companies provide.

3. Karnataka Power Transmission Corporation (KPTC) Vs. Ashok Iron

Works Private Limited
FACTS
Ashok Iron Works, a private company which manufactures iron had applied for obtaining
electricity from the state’s power generation company - the Karnataka Power Transmission
Corporation (hereinafter KTPC) for commencing its iron production. Inspite of paying
charges and obtaining confirmation for the supply of 1500 KVA energy in February 1991, the
actual supply did not begin until ten months later, in November 1991. This delay incurred a
huge loss for Ashok Iron Works. This company had filed a complaint to the Belgaum
Consumer Dispute Forum and later Karnataka High Court. The legal argument by KTPC was
that the complaint was not maintainable as the consumer Protection Act 1986 excludes
commercial supply of goods. It also made an argument that the company in engaged in
manufacturing iron and intended to use it for commercial consumption which is excluded
under the Act. He also said that, the complainant is not a `person’ under Section 2(1)(m) of
the Act, 1986.

Judgment:
In this case, Supreme Court gave his rulings. The Supreme Court mentioned the General
Clause Act that includes a private company within the purview of the definition of a
“Person.” It was also held that the supply of electricity by the KPTC to a consumer would be
covered under Section 2(1)(o) being ‘service.’ Also, if the electrical energy consumer is not
provided to a consumer in time as is agreed upon, then under Section (2)(1)(g), then there
can be a case for deficiency in service. Therefore, the clause stating “supply” of goods for
commercial purpose would not be applied. The Supreme Court sent this case back to District
Forum for retrial on these grounds.
 CONCLUSION
I can conclude that very few consumers are fully aware about the rights, responsibilities and
Consumer Protection Act. Hence, it is necessary to educate them on their rights and
responsibilities as consumers, to make then vigilant. rational and aware buyers. The
government has been fruitful in. providing protection to the consumers in the real sense of
the term and served the purpose of the Act. It is hoped that further improvement in the act
would aim at even more efficiency and render the position of the consumers much stronger
in this era of globalization and privatization where the sudden unchecked advent of Multi
National Companies has to be balanced with the protection of the rights of the consumers
by the legislature and the judiciary.