Consumer Protection Act, 2019: Key highlights

Introduction:

The digital era has brought with it a new era of commerce and digital branding, as well as a new set of customer expectations. Digitization has enabled easy access, a large range of selections, efficient payment systems, improved services, and purchase at one’s leisure. However, along with the expansion came new concerns in terms of consumer protection. As a result, the Indian government has scrapped its three-decade-old consumer legislation and replaced it with a new one. On July 20, 2020, the Consumer Protection Act of 2019 took effect, eliminating the prior 1986 statute. To address contemporary needs, many alterations have been made to fill in the gaps left by the prior statute. This article covers the key highlights of the Consumer Protection Act, 2019.

Inclusion of all e-commerce transactions:

The meaning of “consumer” has been broadened by the Consumer Protection Act of 2019. Any person who purchases items, whether through offline or online transactions, teleshopping, electronic mode, teleshopping, direct selling, or multi-level marketing, is now included in the term. E-commerce transactions were not included under the Consumer Protection Act of 1986.

E filing of Complaints:

It is one of the most significant advantages of the Consumer Protection Act of 2019. It provides consumers with a great deal of flexibility. They can file complaints with a local jurisdictional consumer forum, whether it is close to their home or workplace. It differs from the former practise of filing from the point of purchase or where the seller’s registered office is located. Complaints can also be submitted electronically.

Establishment of Central Consumer Protection Authority (CCPA):

One of the fundamental flaws of the previous Act was the lack of consumer protection authorities to monitor, regulate, and respond to consumer complaints in a timely and effective manner. The New Act has established a consumer protection agency called the Central Consumer Protection Authority (CCPA). It will safeguard, promote, and enforce consumer rights, as well as regulate situations involving deceptive advertising, unfair trade practises, and violations of consumer rights. Furthermore, if a consumer complaint affects more than one person, it has been given broad authority to conduct suo moto steps, require refund of the price of goods/services, recall items, cancel licenses, and initiate class action lawsuits.

Upgrading of Pecuniary Jurisdiction:

Consumer complaints involving goods or services valued at less than INR 1 crore can now be heard by the district forum. When a dispute is worth more than INR 1 crore but less than INR 10 crore, the State Commission can hear it. When the value exceeds INR 10 crore, the National Commission has jurisdiction.

Alternate Dispute Resolution Provision:

Mediation is now available as an Alternative Dispute Resolution technique under the new Act. There will be a rigorous timeline set down in the regulations for mediation. It will allow for faster resolution of disputes and relieves pressure on consumer courts, which are already overburdened with cases.

Introduction of Product liability provision:

Under the Consumer Protection Act of 2019, provisions for product liability have been proposed. The argument that e-commerce platforms are simply “platforms” or “aggregators” will no longer hold water. Now, if a consumer is injured or loses money as a result of defective goods or poor service, the manufacturer or service provider must pay him or her.

Broader definition of Unfair Trade Practices:

The new law expands the definition of unfair trade practices to include the sharing of personal information provided in confidence by a customer, unless such disclosure is undertaken in conformity with the rules of another law. This will aid in data security and the subsequent misuse of data for cybercrime such as phishing and cyberstalking.

Penalties for Misleading Advertisements:

A manufacturer or endorser might face a penalty of up to Rs. 10,00,000 if they make a fraudulent or misleading advertisement, according to the CCPA. For the same, the CCPA may sentence them to up to two years in prison. A subsequent offence may result in a fine of up to Rs. 50,00,000 and a sentence of up to five years in prison. The CCPA also has the authority to prevent an endorser of a deceptive advertisement from endorsing that product or service for a year. The sentence may be increased to three years for each consecutive offence.

Conclusion:

In this age of digitization, an Act as comprehensive as the Consumer Protection Act, 2019 was required to address consumer issues. This Act has clearly empowered consumers and outlined their rights and responsibilities in a categorical and explicit manner. The Act’s enactment demonstrates an attempt to limit unjustified exploitation. The new act, which is based on fair trade standards, eliminates the need for consumers to be cautious. Today’s consumer is handled as if he or she were a king. As a result, it is critical for owners of consumer-driven enterprises, such as e-commerce or retail, to be aware of changes in the legal landscape and to have solid policies in place to deal with consumer redress. Before engaging in unfair trade practices, consumer-driven enterprises should exercise caution.

References:

  1. Consumer Protection Act, 2019
  2. B&B Associates, Analysis and Key Highlights of Consumer Protection Act, 2019,  B&B Associates LLP,  https://bnblegal.com/article/analysis-and-key-highlights-of-consumer-protection-act-2019/
  3. Suchita Shuklat, Consumer Protection Act, 2019: A Primer, SCC Online, https://www.scconline.com/blog/post/2020/12/24/consumer-protection-act-2019-a-primer/
  4. StutiGaliya, Consumer Protection Act, 2019 – Key Highlights, Mondaq, https://www.mondaq.com/india/dodd-frank-consumer-protection-act/838108/consumer-protection-act-2019-key-highlights
  5. HemantSingh, Consumer Protection Act, 2019: Meaning and Key Features, Jagran Josh, https://www.jagranjosh.com/general-knowledge/meaning-and-features-of-consumer-protection-act-2019-1578557665-1
  6. Anonymous, Consumer Protection Act 2019 And Its Salient Features, Legitquest, https://www.legitquest.com/legal-guide/consumer-protection-act-2019-and-its-salient-features#:~:text=The%202019%20Act%20has%20also,defective%20services%20and%20refund%20the

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