Salient Features Of Consumer Protection Bill, 2018 Passed By Lok Sabha

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On December 20, the Lok Sabha, the lower house of India's bicameral Parliament, passed the Consumer Protection Bill, 2018, thus repealing the Consumer Protection Act, 1986.

The Bill aims to provide for protection of the interests of consumers, and for the said purpose, to establish authorities for timely and effective administration and settlement of consumers’ disputes and for matters connected therewith or incidental thereto.

According to Minister Ram Vilas Paswan, Minister of Consumer Affairs, Food and Public Distribution, “The Consumer Protection Bill, 2018 provides for the establishment of an executive agency to be known as the Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers; make interventions when necessary to prevent consumer detriment arising from unfair trade practices and to initiate class action including enforcing recall, refund and return of products, etc. This fills an institutional void in the regulatory regime extant. Currently, the task of prevention of or acting against unfair trade practices is not vested in any authority. This has been provided for in a manner that the role envisaged for the CCPA complements that of the sector regulators and duplication, overlap or potential conflict is avoided.”

The Minister added, “The Bill also envisages provisions for product liability action on account of harm caused to consumers due to a defective product or by deficiency in services. Further, provision of “Mediation” as an Alternate Dispute Resolution Mechanism has also been provided. The Bill provides for several provisions aimed at simplifying the consumer dispute adjudication process of the Consumer Disputes Redressal Agencies, inter alia, relating to enhancing the pecuniary jurisdiction of the Consumer Disputes Redressal Agencies; increasing minimum number of Members in the State Consumer Disputes Redressal Commissions and provisions for consumers to file complaints electronically, etc.”

The salient features of the Bill are:

CONSUMER PROTECTION COUNCILS
• The Central Government shall establish the Central Consumer Protection Council to be known as the Central Council. The objects of the Central Council shall be to render advice on promotion and protection of the consumers’ rights under this Act.

• Every State Government shall establish a State Consumer Protection Council for such State to be known as the State Council. The objects of every State Council shall be to render advice on promotion and protection of consumer rights under this Act within the State.

• The State Government shall establish for every District a District Consumer Protection Council to be known as the District Council. The objects of every District Council shall be to render advice on promotion and protection of consumer rights under this Act within the district.

CENTRAL CONSUMER PROTECTION AUTHORITY
The Central Government shall establish a Central Consumer Protection Authority to be known as the 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.

The Central Authority shall:
• protect, promote and enforce the rights of consumers as a class, and prevent violation of consumers rights under this Act;

• prevent unfair trade practices and ensure that no person engages himself in unfair trade practices;

• ensure that no false or misleading advertisement is made of any goods or services which contravenes the provisions of this Act or the rules or regulations made thereunder;

• ensure that no person takes part in the publication of any advertisement which is false or misleading.

CONSUMER DISPUTES REDRESSAL COMMISSION
The State Government shall establish a District Consumer Disputes Redressal Commission to be known as the District Commission in each district of the State: Provided that the State Government may, if it deems fit, establish more than one District Commission in a district.

Subject to the other provisions of this Act, the District Commission shall have jurisdiction to entertain complaints where the value of the goods or services paid as consideration does not exceed one crore rupees: Provided that where the Central Government deems it necessary so to do, it may prescribe such other value, as it deems fit.

The State Government shall establish a State Consumer Disputes Redressal Commission to be known as the State Commission in the State. Subject to the other provisions of this Act, the State Commission shall have jurisdiction:

(a) to entertain—

• complaints where the value of the goods or services paid as consideration, exceeds rupees one crore, but does not exceed rupees ten crore: Provided that where the Central Government deems it necessary so to do, it may prescribe such other value, as it deems fit.

• complaints against unfair contracts, where the value of goods or services paid as consideration does not exceed ten crore rupees;

• appeals against the orders of any District Commission within the State; and

(b) to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any District Commission within the State, where it appears to the State Commission that such District Commission has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested or has acted in exercise of its jurisdiction illegally or with material irregularity.

The Central Government shall establish a National Consumer Disputes Redressal Commission to be known as the National Commission. Subject to the other provisions of this Act, the National Commission shall have jurisdiction:

(a) to entertain—

• complaints where the value of the goods or services paid as consideration exceeds rupees ten crores: Provided that where the Central Government deems it necessary so to do, it may prescribe such other value, as it deems fit.

• complaints against unfair contracts, where the value of goods or services paid as consideration exceeds ten crore rupees;

• appeals against the orders of any State Commission;

• appeals against the orders of the Central Authority; and

(b) to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any State Commission where it appears to the National Commission that such State Commission has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested, or has acted in the exercise of its jurisdiction illegally or with material irregularity.

The District Commission, State Commission, or National Commission shall not admit a complaint unless it is filed within two years from the date on which the cause of action has arisen.

MEDIATION
The State Government shall establish a consumer mediation cell to be attached to each of the District Commissions and the State Commissions of that State.

The Central Government shall establish a consumer mediation cell to be attached to the National Commission and each of the regional Benches.

• Every consumer mediation cell shall maintain:

• a list of empanelled mediators;

• a list of cases handled by the cell;

• record of proceeding; and

• any other information as may be specified by regulations.

For the purpose of mediation, the National Commission or State Commission or District Commission, as the case may be, shall prepare a panel of the mediators to be maintained by the consumer mediation cell attached to it... It shall be the duty of the mediator to disclose:

• any personal, professional or financial interest in the outcome of the consumer dispute;

• the circumstances which may give rise to a justifiable doubt as to his independence or impartiality;

• such other facts as may be specified by regulations.

PRODUCT LIABILITY

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.

OFFENCES AND PENALTIES
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. 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. The Director General or any other officer, exercising powers under Section 22, who knows that there are no reasonable grounds for so doing, and yet—

(a) searches, or causes to be searched any premises; or

(b) seizes any record, register or other document or article, shall, for every such offence, be punished with imprisonment for a term which may extend to one year, or with fine which may extend to ten thousand rupees, or with both.

To read the entire Official Bill in detail, please view the file attached herein.

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