SUBJECT:

RESEARCH METHODOLOGY

AS A PART OF

RESEARCH & TRAINING DEVELOPMENT ACTIVITIES

REDRESSAL MECHANISM AGAINST MISLEADING ADVERTISEMENTS IN
INDIA

1
Table of Contents

LIST OF ABBREVIATIONS..................................................................................................................................3

LIST OF CASES......................................................................................................................................................5

CHAPTER 1............................................................................................................................................................7

INTRODUCTION...................................................................................................................................................7

1.1. INTRODUCTION................................................................................................................................7

1.2. STATEMENT OF PROBLEM...........................................................................................................10

1.3. RESEARCH OBJECTIVES...............................................................................................................11

1.4. RESEARCH QUESTIONS................................................................................................................11

1.6.RESEARCH METHODOLGY...................................................................................................................12

1.7. CHAPTERISATION..................................................................................................................................12

1.8.LITERATURE REVIEW............................................................................................................................13

CHAPTER 2..........................................................................................................................................................14

SCOPE OF “MISLEADING ADVERTISEMENTS” UNDER THE CONSUMER PROTECTION ACT 1986.14

2.1. INTRODUCTION......................................................................................................................................14

2.2. MISLEADING ADVERTISEMENT........................................................................................................15

2.3. UNFAIR TRADE PRACTICES................................................................................................................16

2.4. SPECIFIC CATEGORIES OF UNFAIR TRADE PRACTICES..............................................................18

2.4.1. Misleading Advertisement and False Representation........................................................................18
2.4.2. Statement Made to the Public.............................................................................................................21

2.5. FORMS OF FALSE OR MISLEADING REPRESENTATION...............................................................21

2.6. BAIT ADVERTISEMENTS......................................................................................................................27

2.7. The offering of "free" gifts, prizes, or other items.....................................................................................28

2.8. ANALYSING NEW CONSUMER PROTECTION ACT 2019...............................................................30

2.9. CONCLUSION..........................................................................................................................................33

CHAPTER 3..........................................................................................................................................................33

TRADEMARK DISPARAGEMENT & ADVERTISING ETHOS-PATHOS: INDIA.......................................33

3.1. INTRODUCTION......................................................................................................................................33

3.2. COMPARATIVE ADVERTISING...........................................................................................................35

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 3.2.1. Position Of Law In India Concerning ‘Comparative Advertising’ And ‘Trademark Disparagement’
......................................................................................................................................................................37

3.3. GENERIC DISPARAGEMENT................................................................................................................39

3.4. PUFFING V. TRADEMARK DISPARAGEMENT.................................................................................40

3.5. TESTING TRADEMARK DISPARAGEMENT......................................................................................42

3.5.1. Single Meaning Rule & Multiple Meaning Rule:..............................................................................43

3.6. ADJUDICATORY TREND- TRADEMARK DISPARAGEMENT IN INDIA.......................................44

3.7. REMEDIES QUA TRADEMARK DISPARAGEMENT.........................................................................46

3.8. CONCLUSION..........................................................................................................................................48

CHAPTER 4..........................................................................................................................................................50

REGULATION OF ADVERTISEMENT THROUGH VARIOUS LEGISLATIONS........................................50

4.1. INTRODUCTION......................................................................................................................................50

4.2. CONSTITUTIONAL ANALYSIS OF COMMERCIAL ADVERTISEMENT IN INDIA......................50

4.2.1Competency of legislature....................................................................................................................52
4.2.2. Media Freedom and Advertisement...................................................................................................53

4.3 COMMERCIAL ADVERTISEMENT AS FUNDAMENTAL RIGHT....................................................55

4.4. ADVERTISING AS FACET OF THE CONSUMER’S RIGHT TO INFORMATION...........................57

4.5. REASONABLE RESTRICTIONS............................................................................................................58

4.6. ADVERTISING AND INTELLECTUAL PROPERTY RIGHTS LAW..................................................59

4.6.1. The Copyright Act, 1957....................................................................................................................59
4.6.2. The Trade Marks Act, 1999................................................................................................................60

4.7. COMPANIES ACT, 2013..........................................................................................................................61

4.8. CONSUMER PROTECTION ACT, 2019.................................................................................................61

CHAPTER 5..........................................................................................................................................................64

EFFECT OF MISLEADING ADVERTISEMENT AND THE MECHANISM FOR READDRESSAL............64

5.1. INTRODUCTION......................................................................................................................................64

5.2. ARTICLE 19 AND FREEDOM OF COMMERCIAL SPEECH..............................................................65

5.2.1. Unfair Trade Practices........................................................................................................................67
5.2.2. Misleading Advertising......................................................................................................................68

5.3. REDRESSAL MECHANISM....................................................................................................................69

5.3.1. Food Safety and Standards Act of 2006 and the Advertising Standards Council of India................71

5.4. THE INTERPLAY BETWEEN CONSUMER PROTECTION AND COMPETITION IN THE

CONTEXT OF UTPS AND RTPS IN INDIA..................................................................................................73

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 5.4.1. Restrictive trade practices...................................................................................................................73
5.4.2. Interests of consumers........................................................................................................................75
5.4.3. Regulation of unfair trade practices...................................................................................................77

5.5. THE NEED FOR CORRECT SEPARATION OF UTPS AND RTPS.....................................................78

5.6. CONCLUSION..........................................................................................................................................82

CHAPTER 6..........................................................................................................................................................84

CONCLUSION AND SUGGESTIONS................................................................................................................84

6.1. SUGGESTIONS AND RECOMMENDATIONS.....................................................................................93

BIBLIOGRAPHY..................................................................................................................................................97

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 LIST OF ABBREVIATIONS

AIR : All India Reporter/All India Radio

All ER : All England Reporters
ANA : Association of National Advertisers
Anr. : Another
ASA : Advertising Standards Authority
ASCI : Advertising Standards Council of India
ATM : Automatic Teller Machine
BDA : Bhopal Development Authority
CCC : Consumer Complaints Council
CDRA : Consumer Dispute Redressal Agencies
CFBP : Council for Fair Business Practices
CIFTI : Confederation of Indian Foods Trade and Industry
CrLJ : Criminal Law Journal

CTJ Consumer Protection and Trade Practices Journal

CULR : Cochin University Law Review
Dept. : Department
DMR : Drugs and Magic Remedies
DOCA : Department of Consumer Affairs
Edn. : Edition
FERA : Foreign Exchange Regulation Act
FICCI : Federation of Indian Chambers of Commerce and
Industry
FIR : First Information Report
FSSAI : Food Safety and Standard Authority of India
Harv. L. R. : Harvard Law Review
HMC : Hydro Micro Circuits
Hrs. : Hours
I&B : Information and Broadcasting
IAA : International Advertising Association

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 IAE : International Applied Engineering
IAMAI : Internet and Mobile Association of India
NB : National Bureau
NBBB : National Better Business Bureau
NC : National Commission
NCW : National Commission for Women
NY : New York
OFT : Office of Fair Trading
P. : Private
PABI : Project Appraiser Board of India
PCI : Press Council of India
Pls. : Plus
PVC : Poly Vinyl Chloride
QB : Queens Bench
RMP : Rural Medical Practitioner
Rs. : Rupees
SBI : State Bank of India
SC : Supreme Court
SCC : Supreme Court Cases
TN : Tamil Nadu
UN : United Nations
UNESCO : United Nations Educational, Scientific and Cultural
Organization
UNICEF United Nations International Children's Emergency
Fund

6
 LIST OF CASES
1. Radhika Litho Press v. Fuser Graphic Equipments (1998) IICPJ 400 (Pondicherry).

2. Philips Medical Systems (Cleveland) Inc. v. Indian MRI Diagnostic and Research
Ltd. and Anr. AIR 2009 SC 1052.
3. General Motors (India) Private Limited Vs. Ashok Ramnik Lal Tolat AIR 2015 SC
562
4. Lakhanpal National Ltd. v. M.R.T.P. Commission1989) 66 Comp. Cas. 519 (SC).
5. Hindustan Latex Ltd v. Neoplast Engineering Pt. (2000) II CPJ 285 (Kerala).

6. Vivek Hatcheries (P) Ltd. v.

Gurmail Singh and Anr. 2002)
I CPJ 5 (Punjab).
7. Khanna Enterprises and Anr.V. Dr. Manjeet Singh 1997) I CPJ 116 (Punjab).
8. M.R. Ramesh v. M/s Prakash Moped House and others RP No. 831 of 2001.
9. Maruti Suzuki India Ltd V. Rajiv Kumar Loomba & Anr Civil Appeal No. 1841 of
2003, decided on 15 July, 2009
10. Dr. Raghubir Singh Jain and Another v. Ansal Housing And Construction Ltd. (1995)
II CPJ 95 (Delhi)
11. Gwalior Development Authority (GDA) v. Manju Nayak and 4 Ors 1998) 2 CPJ 64
(MP)
12. Asha Garg and Others v. United India Insurance Co. IV (2005) CPJ 269 (NC).
13. Bafnav. A Maruti (1996) 2 CPJ 190 (NC)

14. Yamuna Syndicate Limited v. Swam Kaur and Anr 2006) CPJ 81 (NC).
15. M/s Girija Studio v. M/s. A 'Kores Sharp (1986-2005) Consumer 9274 (NS)
16. D.A.V. Institute of Physiotherapy v. Miss Navleen Kaur and Ors (1998) 1 CPJ
430(Punjab).

17. Alkotach Power Industries Pvt. Inc. v. K.N.P. 1989) 66 Comp. Cas. 519 (SC).
18. optical Kalyani Sharp India Ltd. v. Gopal Lakhotia (2003) 3CPJ 435 (Andhra
Pradesh).
19. Hotel Nyay Mandir v. Ishwarlal Jirabhai Desai 2006 1 CPJ 521 (Gujarat).
20. K.MohammedRafi v. Wilkinson Sword India Ltd 2006 CPJ 314 (Karnataka).

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21. Maruti Udyog Limited v. Brijinder Kumar Arora and Anr. 2005 1 CPJ 193 (Jammu &
Kashmir)
22. M/S. Coca-Cola India Limited v. Dr. Amarjit Singh, 5FIRST APPEAL No. 419 of
2002, decided on 9 August. 2010 by the National Consumer Disputes Redressal
Commissio
23. Indian Medical Association v. VP Shantha 1996 AIR 550.
24. Imperial Tobacco Company v. Albert Bonnan AIR 1928 Calcutta 1 (DB)
25. Ucan Products Limited v. Hilti (Great Britain) Ltd. (1968) F.S.R. 248
26. Mc Donalds Hamburgers Ltd. v. Burgerking (U.K.) Ltd. (1968) F.S.R. 248

27. GlaxoSmithKline Consumer Healthcare Ltd. v. Heinz India(MANU/DE/3273/2010)

28. Cable & Wireless Plc v. British Telecommunications 1998 FSR 383

29. Barclays Bank Plc v. RBS Advanta 1996 RPC 307, Chancery Division
30. Vodafone Group Plc v. Orange Personal Communications Services Limited 1997
FSR 34

31. British Airways Plc v. Ryanair Ltd: 2001 FSR 32

32. Cable & Wireless Plc v. British Telecommunications 1998 FSR 383
33. Barclays Bank Plc v. RBS Advanta 1996 RPC 307, Chancery Division
34. Vodafone Group Plc v. Orange Personal Communications Services Limited1996 RPC
307, Chancery Division
35. Indian Express Newspapers (Bombay) Pvt. Ltd. v. Union of India 1985 (1) SCC 641
36. Sakal Papers (P) Ltd. v. Union of India MANU/SC/0090/1961: (1962) 3 SCR 842

37. Bennett Coleman & Co. v. Union of India MANU/SC/0038/1972: (1973) 2 SCR 757
38. Colgate-Palmolive (India) Ltd. v. Anchor Health & Beauty Care Pvt. Ltd.
MANU/TN/0980/2008

39. Tata Press Ltd. v. Mahanagar Telephone Nigam Ltd MANU/SC/0745/1995: AIR 1995
SC 2438
40. Indian Express Newspapers (Bombay) Pvt. Ltd. v. Union of India 1985 (1) SCC 641
41. Sakal Papers (P) Ltd. v. Union of India MANU/SC/0090/1961: (1962) 3 SCR 842
42. Bennett Coleman & Co. v. Union of India MANU/SC/0038/1972: (1973) 2 SCR 757

43. Colgate-Palmolive (India) Ltd. v. Anchor Health & Beauty Care Pvt. Ltd.
MANU/TN/0980/2008

8
 44. Chloride Industries Ltd. v. Standard Batteries Ltd. Decided on 30-091994,
Unreported)

CHAPTER 1

INTRODUCTION

1.1. INTRODUCTION

We live in a commercialized world and advertisements form its backbone. Our senses and
cognition perceive advertisements all the time. Advertisements are intended to create a need
in consumers and to appeal their psyche in order to increase sales. To achieve this goal,
advertisements are often well crafted so that most consumers can identify themselves with the
product. Celebrities, catchy tag lines etc. are the ingredients which make advertisements more
appealing. Advertisements aim at promoting a brand and showcasing that that one brand is
superior to the majority of products available, hence, some level of puffery is expected.
Consequently, advertisements also have an integral linkage to competition. Advertisements
may not only sway the public towards a particular product, they may also reduce the market
share of a competitor if an advertisement disparages a competitor’s products, since such
disparagement would lead to loss of public faith in such competitor’s products. Therefore,
there is a thin line which distinguishes appealing advertisements from misleading and
unethical ones.
Deceptive advertisement practices cut at the very root of the utility of advertisements. It
raises ethical and legal concerns in the advertising context. It can also affect the consumer as
it influences the consumer’s belief and can have negative consequences on their finances and
their health. Advertisements also affect competition by way of influencing consumer choices.
Sometimes by giving wrong information through a deceptive advertisement, the company
confuses and misguides the consumer.
In cases where such misleading advertisements are detrimental towards consumers, the
redressal mechanisms include a complaint to the Advertising Standards Council of India or
under the Consumer Protection Act, 2019 comes to his defence. Similarly, in cases of
infringement of Intellectual property rights (specifically Trademarks), recourse is also
available under the Trade Marks Act, 1999. Although the interests of consumers are
sufficiently acknowledged and dealt with, the impact of misleading advertisements on healthy

9
competition in the market remains a grey area. With respect to competitors, there is a dearth
of an exclusive platform for redressal because the central legislation that regulates
competition in the market (Competition Act, 2002) does not deal with this issue. The main
focus of the Competition act is on Anti-competitive agreements and Abuse of Dominant
position in the relevant market. The need of a redressal mechanism for competitors is
essential because irreparable injury can be faced by a competitor due to a false, deceptive or
misleading advertisement.
This thesis mainly deals with the understanding the scope, impact and redressal mechanisms
under the present Indian legislations related to Misleading Advertisements in India.
Advertising is a type of communication that a business uses to inform its target market about
its current and upcoming products. By ensuring that the goods and services are pertinent,
advertising helps to promote their utilisation by the general population. The customer would
benefit from them in social, financial, or psychological ways over those who do not make use
of these goods or services. Traditional or modern media can be used for communication.
Newspapers, television, movie theatre advertisements, magazines, radio jingles, and other
traditional/mass media are examples of contemporary/new media. Web series advertising and
blogging are examples of contemporary/new media, as are emails and, more lately, the use of
Whatsapp and other web platforms. .
Customers are given a certain impression of the business or product through advertising.
Businesses allocate a significant portion of their annual budget to physical and internet
advertising. Since the expenditures are transmitted directly to the client, the customer
frequently bears the brunt of the company’s lavish advertising budgets. Without effective
advertising, it is extremely impossible to reach different segments of society in a nation with
more than a billion people. But if the product is extravagant and the brand believes that the
product will sell because of the lavish advertising or because the product is endorsed by a
famous person, then the advertising becomes unnecessary. An overview of the legal
definition of "misleading advertising," associated legislation, and their implications for Indian
consumers are given in this paper. It is also addressed along with current and potential
remedies. Advertising that genuinely transmits product information incorrectly or deceptively
is referred to as misleading advertising. Determining if product component or phrase
advertising—such as “Boost is the secret of our energy”—is deceptive can also be used to
identify misleading advertisements. Thus, in addition to being dishonest in its labelling, this
advertising lacks information and has a very confusing tone. The issue with this kind of
promotion is that the effects don’t become apparent until after the product is bought. Even

10
while everything in an advertisement can be taken literally, it can nevertheless be deceptive if
it makes inaccurate claims about the facts, conceals or leaves out key information, makes a
promise or suggests doing something without really intending to, or conveys the incorrect
idea. They can harm an advertiser’s product from a rival and have an impact on consumer
economic behaviour.
False advertisements harm society and disturb every element of their ecology, whether
directly or indirectly. Customers are prompted by this to conceive a fantasy while the truth is
entirely different. Here, a thorough discussion of the negative repercussions is necessary. The
three primary categories of deceptive advertisements are fraudulent, false, and misleading.
When an advertisement presents a product as something it is not and distorts the truth, it is
considered fraudulent. A falsehood may indicate that the advertising exaggerates in relation
to variables like cost, supply, and availability. Misleading refers to media deceit that targets a
consumer’s belief. Because of its deceptive nature, advertisers are compelled to take
customers’ incorrect views about exposure to advertising seriously. Facts can be twisted to
create misleading information.The government has a rightful and strong interest in
controlling the advertising industry. However, those who reject state interference in the
advertising business either argue against it or support the state’s minimal engagement in the
industry.
Advertising regulation by the government must adhere to the principles outlined in the
Constitution. This means that it shouldn’t conflict with the consumers’ right to know about
the goods and services and the manufacturers, producers, distributors, dealers, and service
providers’ fundamental rights on the one hand. It is important to note that the Indian
Constitution’s Article 19(1)(a) guarantees the freedom of speech and expression, which
includes protection for commercial advertisements as a form of speech and expression.
Although commercial advertisements are protected under Article 19(1) (a), they may be
restricted under Article 19(2) of the Indian Constitution on the grounds of public order,
decency, morality, etc. Article 19(1) (g), which guarantees freedom to practise any profession
or to carry on any occupation, trade, or business, also protects and safeguards against the
imposition of unreasonable restraints on the exercise of this right. This right can only be
restricted on the grounds specified, i.e. in the laws governing advertising in our nation are
derived from a variety of sources, including statutes, court rulings, quasi-judicial commission
orders, consumer forum rules, and codes created by both governmental and non-
governmental organisations. The multitude of laws pertaining to advertising indicates a
fragmented approach to advertising regulation as opposed to a comprehensive or integrated

11
one. The majority of these laws forbid derogatory or obscene advertising and attempt to
shield impressionable minds from the damaging impacts of unjust and immoral commercial
advertising. The Young Persons (Harmful Publication) Act of 1956, the Indian Penal Code of
1860, and the Indecent Representation of Women (Prohibition) Act of 1986 are a few
examples. Legislation controls the promotion of illicit substances, herbal treatments,
cigarettes, and other tobacco products, as well as alcohol. It’s interesting to note that these
laws have sections that apply to both commercial and noncommercial advertisements, and
violators face criminal penalties. These laws include the Cigarettes and Other Tobacco
Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production,
Supply, and Distribution) Act, 2003, the Drugs and Magic Remedies (Objectionable
Advertisements) Act, 1954, the Cable Television Networks (Regulation) Act, 1995, the
Drugs and Cosmetics Act, 1940, and the Food Safety and Standards Act, 2006, among others.
The Prize Competition Act, 1955 and the Prize Chits and Money Circulation Schemes
(Banning) Act, 1978, respectively, prohibit the use of names and emblems specified in the
schedule under this Act for the purpose of trade, business, or any other purpose.
The role of law is to encourage and promote ethical, fair, and genuine advertising and to
protect the interests of consumers and society at large from the negative effects of modern
commercial advertising, given the ever-increasing importance of commercial advertising as
the lifeline of trade and business and as an effective means of information and
communication that the consumer needs to make “informed buying decisions” in this era of
competition and open market. Regimes everywhere in the world, from the most liberal
democracies to the most authoritarian ones, have implemented various regulatory measures to
control the threat posed by modern commercials due to the necessity of regulating the
advertising sector. However, advertising laws and ethics differ from one jurisdiction to the
next, based on the social, political, and cultural norms of each nation. Furthermore, they
aren’t sufficient or equally thorough in every jurisdiction.
Given the foregoing, it is imperative that consideration be given to the laws and ethical
standards governing various facets of commercial advertising as they exist in India, and when
applicable, that they be contrasted with those of other developed nations’ advertising laws
and ethical codes.

1.2. STATEMENT OF PROBLEM

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Misleading Advertisements are not only adverse for the unbeknownst consumer but also for
traders/ service providers/competitors in the market whose goodwill and reputation is likely
to be adversely affected by the unfair and anti-competitive advertisements of another trader.
Recourse to consumers is available under the Consumer Protection Act, 2019 and by
approaching bodies such as the Advertising Standards Council of India. While Intellectual
Property Right holders can approach the issue under Trademarks Act, 1999, competitors do
not have a redressal mechanism under the central act that regulates, encourages and maintains
competition in the market i.e., the Competition Act, 2002. Such omission in the Competition
Act, 2002 can be gauged by the varying legislative intents behind both acts. Though the act
has dealt with their problems such as abuse of dominant position and anti-competitive
agreements, it still has some grey areas including the issues arising due to misleading
advertisements and their implications on the competitors.

1.3. RESEARCH OBJECTIVES

2. To understand the scope of Misleading Advertisements under the existing legal
framework and the efficacy thereof
3. To understand the impact of misleading and deceptive advertisements on competition
in the Indian markets
4. To give suggestions, if there is any loophole in the redressal mechanism for
Competitors against misleading advertisements

1.4. RESEARCH QUESTIONS

1. What are the statutory provisions and statutory bodies that regulate Advertisements in
India?
2. What is the impact of Misleading advertisements on healthy competition in the
market?
3. What is the redressal mechanism available to Traders/ Service providers/ Competitors
under the existing law?
4. Does the existing redressal mechanism sufficiently deal with the impact of Misleading
Advertisements on Competition in Indian markets?
5. Are there any deficiencies in Indian regulations?

1.5. HYPOTHESIS

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 1. Misleading and confusing advertisements have an adverse effect on Competition in
the market and on businesses of contemporaries.
2. Competitors in the market do not have sufficient redressal mechanism to deal with the
impact of Misleading Advertisements.

1.6.RESEARCH METHODOLGY

The research methodology which was adopted during the making of the dissertation was
doctrinal. In doctrinal methodology, I have taken help from both the primary as well as
secondary sources of information.

1.7. CHAPTERISATION

 Chapter 1-
Chapter 1 defines “Advertisement” and the aim, objectives and various dynamic
modes of Advertising that have evolved with the advent of mass media and internet. It
discusses how Advertisements affect and influence market behavior. The chapter also
establishes a difference between Advertisement that are ethical in contrast to those
that are deemed to be unethical, misleading or deceptive.
 Chapter 2-
The Second Chapter discusses the Evolution and Amendments in Monopolies and
Restrictive Trade Practices Act, 1969 with Special Focus on Misleading
Advertisements and the scope of “Misleading Advertisements” under the Consumer
Protection Act 1986.

 Chapter 3-
Discusses the scope of “Misleading Advertisements” under the Trade Mark Act, 1999
along with judicial Interpretation on the subject of “Disparagement” of Trade marks.

 Chapter 4-
Discusses the shift in the Indian legislative regime after the enactment of Competition
Act, 2002 and the Consumer Protection Act, 2019. This chapter places focus on the
existing State of laws with reference to “misleading Advertisements”. The chapter

14
 also highlights other relevant Provisions and laws that regulate misleading
Advertisments.

 Chapter 5-
Chapter 5 analyses the effect of misleading Advertisements on Competition in the
Market and whether the existing regime has been effective in regulating the issue of
Misleading and Deceptive Advertisements in order to maintain healthy competition in
the market.

 Chapter 6-
The last chapter is titled “Conclusion and Suggestions”. The researcher concluded the
thesis by analysis whether the Hypothesis has been proved or disproved. This chapter
also summarily offers answers to the research questions as set out above and makes
suggestions on those issues.

1.8.LITERATURE REVIEW

Books
1. T. Ramappa, The Competition Law In India- Policy, Issues And Development (3 rd
Edition, 2013)- This substantially revised edition discusses the Competition Act,
2002, and subsequent amendments to it, in 2007 and 2009.
2. Avtar Singh, Competition Law, (1st Edition, 2012)- Dr. Avtar Singh analyses The
Competition Act, 2002 and its impact on competition, consumers and society. The
topics in this book include the replacement of the MRTP act, Prohibition of certain
agreements, Abuse of dominant position, Regulation of combinations, Competition
Commission of India, Duties, Power and Functions of the Commission, Duties of
Director General, Penalties, Competition Advocacy, Finance, Accounts and Audit,
Competition Appellate Tribunal, Miscellaneous and Subject index.
3. Dr. V.K. Ahuja, Law relating to Intellectual Property Rights, (3rd edition, 2019).

15
 CHAPTER 2

SCOPE OF “MISLEADING ADVERTISEMENTS” UNDER THE CONSUMER

PROTECTION ACT 1986.

2.1. INTRODUCTION

In order to promote the welfare of society, the Consumer Protection Act is essential since it
allows consumers to directly engage in the market economy. Its stated goal is to end the
powerlessness of customers in the face of overwhelmingly powerful businesses and
government agencies that have amassed wealth at the expense of everyone else. The Act's
stated goal is to promote open and transparent government and empower customers to make
well-informed decisions by providing them with complete information on the quality and
potency of goods and services. While wealthy nations such as the United States, the United
Kingdom, and Canada have passed laws to curb deceptive advertising, India has instead
relied on tort law and contract law to address the problem. Defending customers from
deceptive advertising and other forms of unfair commercial practices was not an original
intent of the Monopoly and Restricted commercial Practices Act, 1969 (MRTP Act). This
notion, however, was proven incorrect by the increasing prevalence of misleading and
deceptive techniques. In 1984, the MRTP Act was revised to include explicit measures to
control deceptive business practices. Consumer Councils and a High-Powered Expert
Committee were established under the Consumer Protection Act, 1986 (CP Act) to better
safeguard and promote consumer rights and to prevent the exploitation of a large number of
customers. By using its quasi-judicial powers to resolve consumer disputes, the Act creates a
new system of justice that uses summary trial. The availability of a wide range of
commodities at reasonable rates and the transparency of information on product quality,
quantity, potency, purity, and standards are fundamental goals of this legislation. The Central

16
Consumer Protection Council, State Consumer Protection Councils, and District Consumer
Protection Councils were established to facilitate the promotion and defence of consumer
rights under the Consumer Protection Act, 1986 and 2019. The District Commission, which
consults with the Central Government, is comprised of a President and two to four members
from each district. When the amount of money or products at stake does not surpass twenty
lakhs, the District Forum can hear the case. Unfair and restrictive trade practice concerns
were not initially addressed by the Act. Authorities were granted the authority to hear and
decide on such complaints in 1993 due to new regulations. Taking the Act's goals into
account, the District Forum, State Commissions, and National Commission shall provide a
reasonable interpretation of the Act. Cooperative societies and other customers have an extra
recourse under the Consumer Protection Act. On August 6, 2019, Parliament replaced the
1986 Act with the Consumer Protection Act 2019. On July 20, 2020, the Act and certain parts
were notified by the Central Government and went into force. By establishing authorities to
manage and settle consumer complaints swiftly and effectively, the Act seeks to safeguard
consumers' rights. In addition to expanding the scope of unfair trade practices, it defines
misleading marketing in a more precise way.

2.2. MISLEADING ADVERTISEMENT

Commercials that mislead or are likely to mislead any viewer are considered misleading.
Consumers' decisions on what to purchase might be influenced by deceptive advertising. It
should be remembered that it could be a crime for a business to promote its wares in a way
that could mislead and lead to the consumer suffering financial harm.
The Consumer Protection Act of 2019 provides a precise definition of deceptive
advertisement, which was previously lacking. "Misleading advertisement" refers to an ad for
a product or service that does one of the following: (i) provides an inaccurate description of
the product or service; (ii) makes false claims about the product or service's nature,
substance, quantity, or quality; (iii) makes an explicit or implied statement that would be
considered unfair trade practice if made by the manufacturer, seller, or service provider; or
(iv) intentionally hides important details. If a consumer is led astray by an ad's portrayal of a
product's supposed benefits, the ad is deceptive. Here are a few instances where
advertisements might mislead: Contrary to what is described, the terms and conditions for
receiving the goods or services are different. (For instance, there is a price or charge
associated with "free delivery").  Promises made regarding the features of products and

17
services are deceptive assertions. For instance, the advertised goods actually weights 800
grammes rather than 1 kilogramme. The advertiser's identity and other features are presented
in an inaccurate manner. (For instance, a product that says it's made in India but is actually
made in China) The method or price of calculation is changed. (Think: products aren't really
on sale, but they're marketed as such. There are further deceptive aspects of advertisements.
Consider the case where crucial information is omitted from the advertisement. For instance,
a "60% Discount on everything" deal would only be valid for specific items. Even if all of the
claims made in an advertisement are factually correct, it could still be misleading if it gives
the wrong impression. When a company tries to sell a product or service by making an ad that
is significantly inaccurate or deceptive, they are engaging in misleading advertising. False
advertising often presents claims that fall into three categories: those based on facts, those
based on testimony, and puffery. Claims that are data-based simply indicate that a test, study,
count, or other scientific endeavour was conducted to generate the basis for the claim, in
contrast to claims that are puffery and do not have any scientific basis. An untrue
endorsement was created when a person's identity (name, signature, photo, etc.) was used.

2.3. UNFAIR TRADE PRACTICES

The term "unfair trade practice" is defined broadly and exhaustively under Section 2(1)(r) of
the Consumer Protection Act, 1990. Aside from adding two more types of unfair trade
practices, this definition is an improvement over the one in Section 36(A) of the MRTP Act,
even though the two are identical.The term "unfair trade practice" is defined in the Act as a
series of items preceded by the words. This establishes the concept of unfair trade practice as
being broadly applicable. Unfair trade practices can include anything that uses deception or
unfair methods to promote the sale of products or services, regardless of whether it fits into
the specific categories or not. Each of the above mentioned practice categories has evolved
into its own set of examples. Once again, the CP Act does not require proof of consumer loss
or injury; proof of adoption of an enumerated practice is sufficient. Distinguishing "unfair
trade practice" from "defect in the goods" or "deficiency in service" is recommended. "Unfair
trade practice" is defined quite explicitly within the Act, and the exact relief to be provided is
also mentioned in the Act, according to the State Consumer Disputes Redressal Commission
(SCDRC), Pondicherry's ruling in Radhika Litho Press v. Fuser Graphic Equipments.1
Hence, individuals should refrain from claiming "unfair trade practice" in District Forum or

1
(1998) IICPJ 400 (Pondicherry).

18
State Commission proceedings involving defective goods. Aiming to prevent the general
public from being deceived by advertisements is one reason why laws are put in place to
prevent unfair trade practices. We need to look at particular elements of Section 36A of the
MRTP Act to understand how the legislation works on unfair trade practices. The DGIR
could launch investigations and refer the case to the MRTP Commission based on this
substantive ground. If the activity is detrimental to the interest of any consumer or the public
interest, or consumers generally, the Commission could cease it under Section 36D, which
deals with unfair trade practices. The following categories best describe the particular unfair
trade practices listed in Section 36 (A):
Product or service misrepresentation, including but not limited to inaccurate description,
warranty, or performance claimsPromotion of inflated sale prices. Sales marketing through
contests, lotteries, or games of skillproducts that do not adhere to safety regulations; and.
Putting commodities into storage or destroying them.
The provision of commodities or the performance of services is necessary to constitute unfair
trade practice. That is to say, no unfair commercial practice will occur if services or goods are
not actually provided. A party's liability for unfair business practices in the absence of
product supply was at issue in the case of Philips Medical Systems (Cleveland) Inc. v.
Indian MRI Diagnostic and Research Ltd. and Anr. 2 An argument has been put forth that
the MRTP's purpose is to prevent consumers from being misled into purchasing goods that do
not actually possess certain qualities or characteristics, rather than to address cases where the
goods are not sold at all. If the products are not sold, then Section 36A does not apply. When
products are sold, then it becomes applicable. In the case of General Motors (India) Private
Limited Vs. Ashok Ramnik Lal Tolat 3, an appeal was lodged against an order that had been
made by the National Commission. The applicant had been misled into purchasing a vehicle
due to the respondent's unfair commercial practice, and the respondent was consequently
ordered to pay punitive damages. Despite the lack of a conviction in the complaint and
evidence of actual loss, the award of punitive damages was upheld. The Supreme Court
dismissed the appeal because it found that the plaintiff had not acknowledged that he was the
victim of punitive damages inflicted on other consumers and that the complaint had not
included any such claims. This claim had to be specifically pleaded in order to receive
punitive damages, which were typically granted for misconduct that had nothing to do with
the real loss. When using its revisional powers, the National Commission just cared about

2
AIR 2009 SC 1052.
3
AIR 2015 SC 562

19
whether the State Commission's order to overturn the District Forum's relief and approve the
order that the State Commission ought to have issued had been sufficient. Both the National
Commission and the State Commission exceeded their authority when they granted relief that
was not requested in the complaint or before either of them. As a result, the order concerning
the deposit of the amount for punitive damages was reversed.
You should be aware that the Consumer Protection Act protects you from dishonest business
practices and conduct if you have been a victim of unfair trade practices.

2.4. SPECIFIC CATEGORIES OF UNFAIR TRADE PRACTICES

The definition of ‗unfair trade practice‘ consists of six categories and some categories
have been further subdivided into sub-categories. Along with these, some more unfair
trade practices are added under the new Consumer Protection Act, 2019.Following
specific categories of unfair trade practices 4 have been recognized under the consumer
protection Act:
2.4.1. Misleading Advertisement and False Representation
False or misleading representations are the first type of unfair trade practice, as outlined in
clause (1) of section 2(1)(r). The factum of representation shared by subclauses (i) through
(x) of this provision is that it must be deceptive or untrue. False representations and
misleading advertisements fall under this heading 38 and can be made verbally, in writing, or
visually (including through technological record keeping). When and by whom a statement is
considered made to the public is clarified in the "Explanation" to clause (1) of Section 2(1)
(r). The term "misleading" is used to describe a statement when there are two possible
meanings, one of which is not accurate. That is, "leading people into error" is the literal
translation. Compared to "false," which implies "that is not true," its breadth is broader. As
far as Section 2(l)(r)(l) is concerned, it makes no difference whether the person making the
statement knows it is untrue or not. This provision would also apply in cases where an
innocent individual sincerely states something that is later proven to be untrue. If the law
meant for a seller to not make a statement whose veracity he doubts, then this reading would
be correct. Again, it should be noted that the person who caused the representation to be
made, and not the person who actually made the representation, is the one who is liable under
Section 2(l)(r)(l). As is evident from the "Explanation" appended to clause (1) of Section 2(1)
(r), this provision protects the advertising media or service provider from liability.

4
Farooq Ahmed, ―False and Misleading Advertisements - Legal Perspective‖, J.I.L.I., 168-183(1996).

20
 "False" implies something is not true, which might be misleading. The term "falsely
represents" in subsection 36A(1) means that the statement is not based on reality. According
to Halsbury's Laws of England, a representation is considered false if it is not only false in
substance but also in fact. To determine if a representation is true, one must consider whether
the difference between the represented and actual facts is significant enough for a reasonable
person to consider it material. Another way to put it is that in order to prove a
misrepresentation, there must be substantial falsity. However, if the whole thing is an
accurate depiction or recording of the key facts, then there is no need to prove falsity, even if
there are many inaccuracies in minor details. The inverse is also true: if the overall
impression is wrong, then no amount of meticulous attention to detail will make the portrayal
accurate. The word "misleading" implies that it has the potential to lead people astray. The
vendor must tell the truth if he makes any claims in his ads or other forms of representation.
Part of this responsibility is making sure the depiction is honest and up-to-date. Even if
something is true in a literal sense, it could nonetheless be deceptive or false. Misleading
advertising may be produced or printed with the intent to mislead, or they may fail to mention
important details that should be mentioned. 43 A technically accurate statement may be able
to deceive the consumer due to the use of complex or confusing wording in a representation.
So, you have to figure out if the stated representation could potentially mislead the buyer.
Whether advertisements or other public representations tend to mislead or deceive is a matter
of fact that should be decided by the MRTP Commission or the Consumer Redressal Forums.
Integrity and transparency between vendor and buyer are key objectives. In order to refute an
ad or claim, proof of its veracity is required. If the advertisement has misrepresented the facts
in good faith or bad faith, it makes no difference. It makes no difference whether the claim
was made in good faith or not for deciding whether it is misleading or deceptive. Since intent
to deceive is not a necessary condition, an advertiser's good faith alone cannot absolve them
of the liability of misrepresentation. Determining the impression that the representation or
statement is likely to have on customers is, hence, the crucial criterion. The appellant
company in Lakhanpal National Ltd. v. M.R.T.P. Commission5 worked with a Japanese
company called "Mitsushita Ltd." to produce "Novino" batteries. "National" and "Panasonic"
were listed as partners in the appellant-company's battery advertisements. Although it wasn't
the actual name of the collaborator, it was through these product brands that the collaborator
became well-known in India. Put simply, the appellant-company used the collaborator's
products to symbolise the partnership rather than the collaborator's name. Since the identical
5
(1989) 66 Comp. Cas. 519 (SC).

21
business produced items labelled "National" and "Panasonic," the Supreme Court ruled that
the misleading description did not trigger section 36A of the MRTP Act. It makes little
difference whether the manufacturing company is mentioned by its exact name or by its
product description when referring to standards or quality, as Sharma, J. pointed out.
Although it would be more appropriate for the appellant company to provide the complete
facts by referring to "Mitsushita Ltd." by its correct name and further stating that its products
are known as "National" and "Panasonic," we conclude that the incorrect description of the
manufacturing company in the ads in question does not attract section 36A.
Colgate Palmolive (India) Ltd. was the maker of "Colgatate Dental Cream" in the case, the Ist
respondent. Advertising its tooth-paste "New Pepsodent" in print, visual, and hoarding media,
the appellant asserted that their product was 102% superior to the market leader. The
complaint was lodged by the respondents under the Monopolies and Restrictive Trade
Practices Act, 1969 (MRTP Act). The respondents claimed that the appellant engaged in
"unfair trade practice" as defined in section 36A. This means that the appellant used
deceptive practices, such as making false representations as stated in section 36A(1)(viii) and
providing false and misleading information that "disparaged" the appellant's goods as stated
in section 36A(1)(x), to promote the sale, use, or sIt would be risky for the MRTP
Commission to even offer a preliminary view on the subject of claims of 102% bacterial
superiority, which necessitated a highly scientific approach and should be resolved by
impartial experts, as the Commission noted. Regarding the "anti-bacterial" superiority, the
Commission stated that it was inferred that the appellant considered Colgate as 102%
inferior, rather than just its own toothpaste, as superior. A direct statement concerning
inferiority was not required; an allusion, hint, or other similar expression would suffice if it
appeared to constitute "disparagement" for the meaning of section 36A(1)(x). In light of the
foregoing, the MRTP Commission issued a preliminary injunction prohibiting the appellant
from asserting any kind of anti-bacterial superiority in its advertisements, whether through
direct or indirect references, and from stating any "specific quantum" of anti-bacterial
superiority until the claim is proven. The interest of the consumer would likewise be
safeguarded by this. In its decision to reject the appeal, the Supreme Court noted that the
Commission's ruling was both an interim measure until a final order could be issued and that
it was entirely discretionary, therefore it could not be overturned in this case.

22
2.4.2. Statement Made to the Public
Section 2(l)(r)'s Explanation, included in clause (1), specifies the circumstances under which
a representation can be considered a statement made to the public. The following are
examples of where this provision is put into effect: (a) on products that are being sold or
shown for sale, or on their packaging or container; (b) on any materials that are sold or shown
alongside these products, or on anything that the products are displayed on; or (c) in or on
anything that is sold, sent, delivered, transmitted, or otherwise made available to the public.
In each of these cases, the statement will be considered as a public statement made by the
person who caused it to be so expressed, made, or contained. Any assertion made in any of
these ways is considered an assertion made in front of the general public. In addition to being
shown or offered for sale, the remark may also be expressed on the product itself, its
packaging, or both. Therefore, the clause would apply to any related advertisement, circular,
53 literature, etc., whether released separately or included with the piece. In addition, the only
person who can assert, make, or contain a statement is the one who caused it to be stated,
made, or contained. It shows that no one else involved in the process of making the
representation is liable; rather, the responsibility lies solely with the person who produced the
misrepresentation. Thus, a person who owns, controls or manages the medium (e.g.
newspaper, journal, magazine, radio or television) through which the representation is made
will not be liable because he himself is not making the representation but following the
instructions of his advertiser

2.5. FORMS OF FALSE OR MISLEADING REPRESENTATION

Misleading claims on a product's quality, quantity, grade, composition, style, or model are
among the many types of representation covered under the Consumer Protection Act (CPA).
These actions can lead to unfair trade practices since they are misleading and deceptive. Due
to the misleading nature of such claims, they have been outlawed. These claims can pertain to
the standard, quality, quantity, grade, composition, style, or model of a product. As an
illustration, consider the case of Hindustan Latex Ltd v. Neoplast Engineering Pt. 6 The
machine that the respondent supplied was subpar and did not live up to his claims, Ltd. Since
the machine had to be supplied with both things, the Kerala State Commission deemed it an
unfair commercial practice. As the Punjab SCDRC ruled in the case of Vivek Hatcheries (P)
Ltd. v. Gurmail Singh and Anr.,7this action constitutes unfair commercial practice. The case
6
(2000) II CPJ 285 (Kerala).
7
2002) I CPJ 5 (Punjab).

23
of Khanna Enterprises and Anr.V. Dr. Manjeet Singh 8, the parties involved in this matter
had an arrangement for the appellants to provide a Confident Clinik Chair; however, the
respondent was not satisfied with the chair that the appellants had delivered. No one was able
to get their hands on the agreed-upon chair, and not even the appellants were willing to give
back the money that was taken on 3.6.1992. The respondents in the case of M.R. Ramesh v.
M/s Prakash Moped House and others9 published an ad in the "Deccan Herald" on October
21, 1993, claiming that the vehicle would have an economy mileage of 80 km/lit.
Nevertheless, the advertised standard conditions were not clear or understandable, and the
real performance was lower. Noting that the advertisement in question is deceptive and
constitutes unfair trade practice, the National Commission issued a restraining order against
the company and ordered them to pay the complainant Rs. 25,000 in compensation.
Distributing a less quantity of goods than what is advertised is also considered unfair trade
behaviour. Working with Alkotack Power Industries Pvt. Ltd. "Using Jensher 2000 Petrol can
be saved up to 22%," the opposing party's advertisement said in V. K.N. Gopala Krishna
Bhatt and Ors., which caused a decrease in overall mileage rather than an increase and had an
effect on the engine's performance. The complainant in Tapasini Sinha and Ann v. The
Imperical Match Works and Ors. bought match boxes that included fewer than 50 match
sticks—the smallest allowable inaccuracy according to the 1979 Standards of Weights and
Measures (Packaged Commodities) Rules. This was deemed an unfair trade practice by the
Orissa SCDRC. It is also considered unfair trade conduct when a particular part that is
supposed to be included in the goods is not actually included. In the case of Maruti Suzuki
India Ltd V. Rajiv Kumar Loomba & Anr 10., the individual suing the car dealership claimed
that he was charged too much for a catalytic converter that was neither installed in his vehicle
nor something he had specifically requested. Since the conduct in question represents an
unfair business practice as defined in Article 2 (l) (r) of the Consumer Protection Act, 1986,
the Supreme Court ruled that Respondent No. 1's complaint is warranted. The Indian
Consumer Code addresses the practice of making misleading claims about the grade or
quality of services in Section 2(1)(r)(l)(ii). Intentional misrepresentation of the services'
quality, grade, or standard is a violation of this provision. The Tamil Nadu State Commission
found an unfair trading conduct in the instance of the State Bank of India, where the other
party kept the money for a year before returning it without interest. In a separate case, the

8
(1997) I CPJ 116 (Punjab).
9
RP No. 831 of 2001.
10
Civil Appeal No. 1841 of 2003, decided on 15 July, 2009

24
Orissa State Commission determined that it is unfair commercial practice to provide false
information about the status of airline tickets. To the extent The appellant in that Safron
Marketing India Pvt. Ltd. v. Suknvir Singh proposed a plan to sell many electrical products
and have them delivered in exchange for a deposit equal to the item's price. The respondent
paid Rs. 14,916/-for the inverter but never received it while waiting for its delivery. He
eventually lost his temper and demanded a full refund. The appellant proposed that the
respondent buy a colour TV and pay the difference in price instead of receiving a refund.
This Practice was deemed unfair by the Delhi State Commission.
A Group Housing Society was ordered to pay interest at 12% in the case of B. K. Aggarwal
v. Haryana Officers and Public Enterprises Employees Welfare cooperative and Housing
Society. The complaint subsequently paid the main amount plus interest and became a
member. The other side went a step farther and decided to charge the new members 24%.
This was deemed an unfair commercial practice by the Haryana SCDRC. In the case of Dr.
Raghubir Singh Jain and Another v. Ansal Housing And Construction Ltd.11, the
individual bringing the complaint reserved an apartment with an area of 872 square feet. sq.,
however the opposing party requested payment for 1,120 sq. regarding the additional 25%
space, known as "super area," no evidence has been shown to support this claim. According
to the Delhi SCDRC, the other party's behaviour constitutes unfair trade practice.
No plot was allocated to the appellant in Gwalior Development Authority (GDA) v. Manju
Nayak and 4 Ors12., despite the appellant advertising for plot allocation. In their appeal, the
appellant argued that the government had not yet purchased the land necessary to make the
allotment. According to the National Consumer Dispute Redressal Commission, it is
considered a defect of service and an unfair trade conduct when the other party does not offer
the Country Club as advertised. Even if a statement does not offer a misrepresentation of a
product, its price, or service, it may nonetheless be considered unfair or misleading. Having
someone provide a service while posing as a doctor is a common example of this type of
practice. The service offered by insurance firms is also covered by Section 2(1)(r)(l)(ii).
Unfair trade practice may occur if the insurer's service does not meet the stated practice. With
Smt. Case of Asha Garg and Others v. United India Insurance Co. 13For proposals involving
large sums of money, the National Commission ruled in Ltd. 82 that the insured must verify
the assured's status, income, and means of income (if necessary) before accepting the

11
(1995) II CPJ 95 (Delhi)
12
1998) 2 CPJ 64 (MP)
13
IV (2005) CPJ 269 (NC).

25
proposal. After agreeing to pay a hefty premium in the event of a risk, the insurance
company's officials would be engaging in unfair trade practice if they denied the policy
amount based on completely fabricated grounds. When products are misrepresented as being
brand new when in fact they are not, the "old goods described as 'new'" clause kicks in. 'New'
and 'old' are defined case by case. This provision defines unfair trade practice as the sale of a
used car under the false pretence that it is brand new. According to the Delhi SCDRC, the
other side failed to provide sufficient proof that the compressors utilised in the AC units were
not brand new, sealed units but rather refurbished used ones. It constitutes unfair commercial
practice because the other party categorically represented that the air conditioner had original
sealed Sri Ram Compressors while, in fact, repaired compressors had been used. It shall not
be considered unfair commercial practice if the customer was either told or reasonably should
have known before making the purchase that the items had been used before. With Sanjay
Bafnav. A Maruti14 carry van was bought by the respondent, Dr. Vijay P. Aher, on 27.2.93.
A temporary registration certificate, bearing the number, was obtained in the name of one Mr.
Sanjay when the vehicle was delivered. 5227 (DMR). The petitioner's revision petition was
granted by the National Commission, which reversed the District Forum's finding of unfair
commercial practice by the dealer.
The respondent in The Yamuna Syndicate Limited v. Swam Kaur and Anr15. was dissatisfied
with the sale of a used tractor instead of a new one. According to the National Commission,
there was insufficient proof from a technical expert to establish the tractor's age or whether it
had any defects. Even without looking at all of the material, the State Commission confirmed
the District Forum's decision. Based on the revision petitioner's clear evidence, the
Commission approved the tractor as new. In the end, the Commission determined that the
revision petitioner did not suffer from a lack of service.
This provision would apply in the case of the use of misleading testimonials that claim to
have been provided by happy clients. 'Performance' and 'characteristics' encompass
misleading claims about the longevity of products or the efficiency of services. In cases
where products are misrepresented as being appropriate for a specific function, this provision
would be invoked. In M/s Girija Studio v. M/s. A 'Kores Sharp16 KS 1101 Photo Copier'
machine was ordered from the respondent by Koron Business System Ltd. and another party,
the petitioner (complainant). He claimed that when he placed the order, it was mentioned that

14
(1996) 2 CPJ 190 (NC)
15
2006) CPJ 81 (NC).
16
(1986-2005) Consumer 9274 (NS),

26
the photocopier was made in India in technical collaboration with Sharp Corporation Osaka,
Japan. However, when he received it, it was labelled as "Kores Winner-1101" instead of
"Kores Sharp KS 1101." The National Commission ruled that when consumers shop for
products with specific brands, they may pay different prices for the same quality.
The Australian Holden Company was deceived into thinking that the engine in the
complainant's Opel Astra was made by German engineers and technologists in the case of
Vinoo Bhagat v. General Motors (I) Ltd. & Anr. Since General Motors's subsidiary made the
engine, the Delhi State Commission deemed this to be deceptive advertising. According to
the Delhi State Commission, it is not the location of production that matters, but rather the
technology employed. The appellant in D.A.V. Institute of Physiotherapy v. Miss Navleen
Kaur and Ors17. ran ads in Indian media claiming approval from the Indian Association of
Physiotherapists (IAP). It turned out, though, that neither the institute's formal recognition
nor even its provisional recognition had come from I.A.P. Based on the information provided,
the Punjab SCDRC concluded that the students who were purposefully enrolled in the course
despite the institute's lack of recognition or approval were victims of unfair trade activity.
When it comes to S. Apologies, the complaint lost 2.5 years of schooling because the
opposing party, Dr. M.R. Sreedharan Nair and others, misled them into thinking the course
was officially recognised and linked with the institution. The practice was deemed unfair by
the Kerala State Commission. Artificial Need whenever an advertisement generates an
illusory need for a product or service. The word "need" does not mean necessity in the strict
economic sense, yet the words "false" and "misleading" are both used in the subclause.
At Alkotach Power Industries Pvt. Inc. v. K.N.P.18 The case of Gopala Krishna Bhat and
other parties. The appellant claimed in their advertisement that the 'Jensher-2000' could
enhance mileage when used with two-wheelers (102). Unfortunately, the 'Jensher-2000' had a
negative impact on the respondents' two-wheelers' performance and reduced overall mileage.
According to the Karnataka State Commission, this is an unfair practice. It is not necessary
for a false statement to misrepresent a product, price, or service in order for it to be unfair or
misleading. A common example of this type of behaviour is when someone provides a
service while pretending to be a doctor or a scientist when they are not. An unlicensed
compounder is at the centre of this case after he was accused of engaging in unfair trade
practices by injecting a juvenile boy. The compounder was found to be engaging in unfair
trade conduct after the District Forum and State Commission brought attention to the fact that

17
(1998) 1 CPJ 430(Punjab).
18
1989) 66 Comp. Cas. 519 (SC).

27
they did not have a valid RMP licence. This was later confirmed by the National
Commission. Unfounded claims, in which marketers or manufacturers make false promises
about the product's efficacy, are addressed. This provision makes it clear that the seller's or
manufacturer's warranties and guarantees must be founded on sufficient testing. Since a
guarantee would be meaningless if it stripped consumers of their statutory rights, it should
not do so. That being said, the CP Act does not specify what constitutes an acceptable or
appropriate test. The burden of proof for this defence will be on the individual claiming it, as
stated in the proviso to clause (vii). Therefore, it is on to the individual making the claim to
prove that sufficient or appropriate testing were carried out. It is unfair trade practice
according to this rule for an ad to promise weight loss in a certain amount of time without
proper or adequate testing. Misleading Warranties or Guarantees in Respect of Goods or
Services (6.3.1.3.8) covers more ground than its predecessor (6.3.1.2). The three cases
covered by this provision are as follows:(1) promises that cannot be reasonably kept;(2)
promises to replace, maintain, or repair an item; and(3) promises that are not backed by
reasonable assurances or warranties. This provision pertains to contracts for after-sale
services in which the manufacturer or dealer promises to keep the product maintained and
offer regular servicing for a set amount of time but fails to do so. The parties in the case of
Optonica Kalyani Sharp India Ltd. v. Gopal Lakhotia 19 claimed in their advertisements that
the Optonica colour TV had an integrated stabiliser system and was a joint venture of the
Japanese company Sharp Corporation. Since the veracity of the advertisement could not be
proven, the Andhra Pradesh State Commission ruled that it constituted an instance of unfair
trade practice. Per Section 2(1)(r)(l)(vii) of the Consumer Protection Act, 1986, a simple
pledge to substitute goods of one brand with those of another and a later refusal to do so does
not constitute unfair commercial practice. As CEAT tyres were out of stock, the other party
promised to replace them a few days later, and the text details that scenario. In the
meanwhile, JK tyres were supplied. The District Forum agreed with the plaintiff and ruled
that the action constituted unfair competition. But the State Commission disagreed, ruling
that it is not unfair commercial conduct to simply offer to replace items of one brand with
goods of another brand and then fail to deliver. The literature also delves into warranties,
which are frequently crafted in extremely technical language and could contain significant
restrictions on the warranty's scope. The provision states that the terms of any warranty on
products or services must be disclosed in plain or easily understood English. This provision
only applies while the guarantee or warranty is in effect; after its expiration, consumers will
19
(2003) 3CPJ 435 (Andhra Pradesh).

28
not be able to use it to seek remedy. The essay also delves into the topic of advertising'
objectives to boost sales, which can be inferred from their actions or inactions. Also included
are situations where items are being sold through clearance sales or off-season discounts,
which can lead to false or misleading pricing claims. A seller's carelessness in protecting their
position by failing to remove the correct price label from an item is what gives rise to
deceptive prices in advertisements, which is where the problem resides. This clause is the
only one in which the word "materially" is used; it describes cases such as a vendor stating
that a product is now available at a lesser price than before. In this particular scenario, this
sub-clause would only be applicable if (a) the seller's usual price is lower than Rs. 700/-, (b)
the price is the same in the relevant marketplaces, and (c) the product is not offered at a
discounted price as advertised.The defendant in Hotel Nyay Mandir v. Ishwarlal Jirabhai
Desai20 sold Mirinda soft drink bottles for Rs. 18/-each, even though the product had an MRP
of Rs. 12.50/-. Products, goods, and services have been or are being sold or delivered at the
usual price, according to the Gujarat State Commission, therefore any mention of price is
understood to be a reference to that price.

2.6. BAIT ADVERTISEMENTS

Bait advertisements are false or misleading representations of goods or services offered at

attractive bargain prices, causing potential buyers to spend time and money on the seller's
premises. This weakens the sale resistance of the customer, making them more vulnerable to
high pressure salesmanship and potentially leading to imprudent purchases. This practice is
covered by clause (2) of section 2(l) (r), which prohibits the publication of any advertisement
for the sale or supply at a bargain price, of goods or services not intended to be offered at the
bargain price, or for a period that is reasonable, considering the nature of the market, size of
business, and the nature of the advertisement. The provision applies to goods and services.
Advertisement, which includes any sale promotional message published by a supplier through
mass media, is covered under this provision. A bargain price can be either indicated in the
advertisement as a bargain price by reference to an ordinary price or otherwise. A price that a
person could reasonably understand as a bargain price may still be caught if it is lower than
the normal price for similar goods or services. The text outlines the concept of intention in
advertising goods or services at a bargain price. It emphasizes that the intention must be

20
2006 1 CPJ 521 (Gujarat).

29
established that the goods or services were not intended to be offered at a bargain price for a
reasonable period of time and in reasonable quantities. This is a crucial element of clause (2)
of section 2(1)(r), as it requires advertisers to exercise special care in advance before
advertising the sale at bargain price. The text also discusses the cases of bait advertising,
where advertised goods are not available or are not available for a reasonable period and in
reasonable quantities at bargain price. In these cases, the MRTP Commission has held that
issuing an advertisement offering bargain price but in actual practice, the bargain price is
either not given or the customer has to pay more than the price outwardly indicated, is
primarily an unfair trade practice under section 36A(2) of the MRTP Act. The text also
discusses the exceptions to clause (2) of section 2(1)(r), which include taking reasonable
steps to obtain a quantity of the product that would have been reasonable but was unable to
obtain due to events beyond the advertiser's control, obtaining a quantity of the product that
was reasonable but was unable to meet the demand because that demand surpassed the
advertiser's reasonable expectations, or undertaking to supply the same product or an
equivalent product of equal or better quality at the bargain price and within a reasonable time
to all persons who requested the product and were not supplied therewith during the time
when the bargain price applied and fulfilled the undertaking.

2.7. The offering of "free" gifts, prizes, or other items

The offering of "free" gifts, prizes, or other items is a common promotional tool used to
attract customers. However, such schemes can be deceptive and result in the cost of the item
being recovered from the selling price charged in the transaction. If an offer of a "free" gift or
prize is made without the intention of performing it as offered, it will amount to an unfair
trade practice covered by sub-clause (a) of clause (3) of section 2(1)(r). Consumers may be
misled into thinking that a genuine free gift has been offered, whereas the price of the gift is
charged with the cost of the item purchased. For example, in the case of Khaitan Electricals
Ltd., the company advertised a scheme of "Great Fans, Great Gifts," where buyers of its fans
were expected to pay Rs. 13 extra for a gift coupon carrying a wide range of gifts of unequal
value. This was clearly held to be an unfair trade practice under section 36A(3)(a) of the
MRTP Act. When making a "free" gift or prize, all terms, conditions, and obligations upon
receipt and retention of the "free" item should be clearly and conspicuously set forth at the
outset of the offer to leave no reasonable probability that the terms of the offer might be
misunderstood. Disclosure of the term of the offer set forth in a footnote of an advertisement

30
to which reference is made by an asterisk or other symbol placed next to the offer is not
regarded as making disclosure at the outset. Under clause (3) of section 2(l)(r), it is necessary
to establish that the offer was made "with the intention of not providing them as offered." In
cases like K.MohammedRafi v. Wilkinson Sword India Ltd 21 and Maruti Udyog Limited v.
Brijinder Kumar Arora and Anr.22, the Karnataka State Commission held these practices to
be unfair. The MRTP Act prohibits the conduct of any contest, lottery, game of chance, or
skill for the purpose of promoting the sale, use, or supply of any product or business interest.
This provision has been expanded to include any business interest that may result in
promotion of the sale, use, or supply of such products. In cases like Messers Colgate
Palmolive (India) Ltd. and Avon Cycles Pvt. Ltd., the conduct of lotteries and contests tends
to induce consumers to buy products on consideration other than quality and price, which can
harm consumer and public interest. The award of prizes benefits only a small number of
consumers, which is not in the overall interest of consumers. Discriminatory benefits to a
select few without corresponding benefits to the bulk of consumers are not in the overall
interest of consumers. Instead, the same amount can be used to reduce prices or provide
better services to consumers, which can enhance consumer satisfaction. The practice of
offering prizes by lottery tends to encourage gambling instinct, leading to unnecessary,
avoidable, and excessive purchases by consumers for the purpose of gaining entry into the
lottery. Such purchases are a real loss to the consumer, and lotteries and contests act in a
prejudicial manner in regard to consumer and public interest..In M/S. Coca-Cola India
Limited v. Dr. Amarjit Singh,23 the National Commission held that a large number of
unidentifiable consumers were likely victims of discrimination vis-à-vis those who
participated in the scheme on or after 3rd October 1998. The Commission concluded that the
scheme violated the provisions of section 2(l)(r)(3)(b) of the Consumer Protection Act and
constituted an unfair trade practice on the part of the appellant. No exceptions have been laid
down to clause (3) of section 2(1)(r), but some exceptions were recommended by the Sachar
Committee for their incorporation in the MRTP Act. These exceptions should have been
incorporated in the Act as a safety valve for the trader, particularly when making an honest
offer by adequate and fair disclosure for the benefit of the consumer.
The Amendment Act, 2002 has inserted a new sub-clause (3 A) in section 2(1)(r) of the Act

21
2006 CPJ 314 (Karnataka).
22
2005 1 CPJ 193 (Jammu & Kashmir)
23
5FIRST APPEAL No. 419 of 2002, decided on 9 August. 2010 by the National Consumer Disputes Redressal
Commissio

31
to enlarge the definition of "unfair trade practice" to include withholding information about
the final results of any scheme offering gifts, prizes, or other items free of charge.

2.8. ANALYSING NEW CONSUMER PROTECTION ACT 2019

Publication of the Consumer Protection Act, 2019 in the Official Gazette occurred on August
9, 2019, following the President of India's assent. The law is organised into eight chapters
and consists of 107 sections. Some of the new words used in the law's definitions include
"Advertisement," "Misleading Advertisement," "Central Authority," "Mediation,"
"Mediator," "Consumer Rights," "Regulator and Unfair Contract," "Design," "Direct Selling,"
"Director General," "E-Commerce," "Electronic Server Provider,"
"Endorsement,""Establishment," "Harm," "Injury," "Express Warranty," "Product and
Product Liability," "Product Manufacturer," "Product Manufacturer," "Product Liability
Action," "Product Seller," and "Product Service Provider."New definitions have been added
to "advertisement," "endorsement," "mediation," "consumer rights," "central authority," "e-
commerce," "electronic server provider," "endorsement," "Establishment," "Harm," "Injury,"
"Express Warranty," "Product and Product Liability," "Product Manufacturer," "Product
Liability Action," "Product Seller," together with "Product Service Provider." Teleshoppers,
direct salespeople, and MLMers are now also considered "consumers" because of the
expansion of the definition of "consumer" to encompass digital traders.
The term "e-commerce" refers to the practice of trading goods and services using online
platforms. It is now within the purview of the federal government to regulate online business
in order to curb unfair trade practices. When it comes to offshore e-commerce and the
eventual enforcement of CPA 2019, it's not clear what will be covered.
Due to two significant modifications in the law—the addition of "unfair contracts" and the
expansion of unfair trade practices—the number of major grounds to submit complaints has
been raised to seven. Any agreement between a business and a customer that materially alters
the customer's rights is considered an unfair contract. Since banks and other financial
institutions are also subject to the Act, these regulations would have an effect on them as
well. Nevertheless, the interpretation of internet contracts by courts is an open question.
The Indian Consumer Protection Act (CPA) has broadened the definition of "unfair trade
practice" to encompass three more scenarios: first, the non-issuance or failure to issue a bill
or cash memo; second, the refusal to accept defective goods or deficient services for return or
withdrawal; and third, the disclosure of personal information about consumers to any third

32
party, unless such disclosure is required by law or is in the public interest. There is now a
distinct chapter in the 2019 CPA called "Product Liability" that explains who is responsible
for faulty items. In the event that a customer suffers harm as a result of a faulty product or
inadequate service associated with a product, the maker or seller of the product is liable for
such harm. For the purpose of clarifying who can be held accountable for an action under
Chapter VI of CPA 2019, CPA 2019 specifies a product maker, product seller, and product
service provider. Initiating a product liability action requires establishing that the product in
question was defective in design, had a manufacturing defect, deviated from the
manufacturing specifications, failed to conform to the express warranty, or lacked sufficient
instructions for proper usage to avoid injury or warnings about wrong or inappropriate usage.
A product seller who imports, sells, distributes, leases, installs, prepares, packages, labels,
markets, fixes, maintains, or is otherwise involved in positioning the product for commercial
purpose is also included in the act, in addition to the definitions specified in CPA 2019.
Manufacturers who also sell or provide services fall under this category, but sellers of real
estate, experts in the field, individuals whose only role is to provide financial support for the
product's sale, and those who lease products without reasonable access to inspect them for
defects are not. The goal of India's Consumer Protection Act (CPA 2019) is to create a
centralised body to safeguard consumers from deceptive advertising and unfair business
practices by establishing the Central Consumer Protection Authority (CCPA). If a consumer
complaint impacts more than one person, the CCPA will have the authority to take suo moto
steps, recall products, mandate price refund, terminate licences, and initiate class action
lawsuits. Any thing that can be delivered in its whole or in parts and made for the purpose of
being introduced to trade or commerce is considered a "product" according to the CPA 2019,
with the exception of human tissues, blood, blood products, and organs. In addition to
imposing fines, the CCPA will issue safety notices to customers about potentially harmful
products and services, as well as guidelines to avoid unfair trade practices and directions to
the relevant trader, manufacturer, endorser, advertiser, or publisher to remove or amend a
misleading or false advertisement. In accordance with CPA 2019, district collectors are now
authorised to investigate matters pertaining to consumers' collective interests. In the event of
a complaint or CCPA reference, they have the authority to conduct an investigation or
inquiry. In addition to consumers submitting complaints to resolve their issues, the formation
of a centralised authority and taking action as a class provides an extra means of relief. The
maximum penalties for manufacturers or endorsers found guilty of false or misleading
marketing are two years in prison and a fine of up to one million Indian Rupees (INR). The

33
maximum punishment for a second offence is five years in prison and a fine of five million
Indian Rupees (INR). Additionally, for up to a year, the CCPA can forbid the endorser of a
deceptive commercial from endorsing that specific product or service. The maximum length
of time banned can be three years for each succeeding infraction.
The CPA 2019 omits healthcare from the term of "service" that was previously included in
the consumer protection bill that was enacted by the Lok Sabha. Medical professionals are
worried about potential abuse of the CPA 2019 due to the Healthcare Amendment, which was
introduced in Parliament to remove healthcare from the list of services. Since healthcare
services are not specifically exempt from the CPA 2019 in the amendment, they should not
be removed from the category of services. In the case of Indian Medical Association v. VP
Shantha24, the Supreme Court interpreted healthcare as a service under the CPA 1986,
enabling patients to sue doctors for inadequate treatment. But once it's in effect, it's not
obvious if the CPA 2019 will still be relevant. District Consumer Forums now have
jurisdiction up to 1 crore, state consumer forums from 1 crore to 10 crore, and national
consumer forums above 10 crore, according to the amended CP Act, 2019. With the
imposition of necessary substance and format for parties to attend mediation, this offers a
new framework for consumer credit while modernising its laws. In addition to laying the
groundwork for digital marketing and online purchasing, the CP Act expands customer
recourse to forums in the event of a product or service failure, regardless of whether the
purchase was made online or not. Following the Supreme Court's upholding of the
amendments on August 9, 2019, the purchaser of the property now has the exclusive right to
sue the developer as a financial creditor through either the NCLT or another court. The three
commissions' pecuniary jurisdictions have been expanded thanks to amendments passed by
the parliament on August 01, 2019, which means that appellate commissions will receive less
claims and cases will be resolved more quickly. A mediation cell has been established at the
district, state, and national levels, as well as at the National Commission and its regional
benches, to facilitate the expedited resolution of disputes in accordance with the CPA 2019.
As a result of the new penalties introduced by the CPA 2019, commissioners can now fine
offenders between INR 25,000 and 1,000,000 for disobeying their orders. All three
commissioners were assigned mediation cells as part of the CPA 2019's new ADR dispute
resolution tools. The district commission in the consumer's place of residence or place of
employment now accepts written and electronic complaints. But eventually the government
will have to announce the process.
24
Indian Medical Association v. VP Shantha&Ors.1996 AIR 550.

34
2.9. CONCLUSION

So long as the amount a consumer pays is directly proportional to the amount of satisfaction
or utility he gets from a product, there's no reason for them to pay more for it just because a
lot of money went into advertising it. To prevent prices from being artificially raised, the
government must strictly regulate advertising spending. It is equally important to ensure that
misleading advertisements are thoroughly checked. To that end, the Consumer Protection
(Amendment) Act, 2002, which went into effect on March 15, 2003, added clause (hc) to
section 14 of the Consumer Protection Act. This provision allows the District Consumer
Forum to order the responsible party to publish corrective ads, which will offset the negative
effects of the misleading ads at their expense. Everyone agrees that in order to safeguard
themselves from unfair commercial practices, consumers should be able to easily obtain
market information.

CHAPTER 3

TRADEMARK DISPARAGEMENT & ADVERTISING ETHOS-PATHOS: INDIA

3.1. INTRODUCTION

The definition of disparagement is “critiquing someone incorrectly.”1. “To speak of

slightingly, undervalue, to bring discredit or dishonour upon, the act of deprecating,
derogation, a condition of low estimation or valuation, a reproach, disgrace, an unjust
classing or comparison with that which is of less worth,” is how the New International
Webster Comprehensive Dictionary defines “disparagement.” The specifics of each case
determine whether or not a trader’s or manufacturer’s goods are disparaged. The court only
has to be aware that insults can be subtle, devious, and covert in addition to being plain,
obvious, and blatant. The last focus of judicial analysis in trademark disparagement
proceedings is “what is the statement made by the rival trader" and "how it belittles,
discredits or detracts the reputation of another’s property, product or business.”2. The
Lanham Act’s Section 225 stipulates that no trademark may be denied registration unless it
contains or is made up of immoral, dishonest, or scandalous content; or content that
disparages or falsely suggests a connection with individuals, organisations, ideas, or national
symbols, or that would bring them into disrepute. The great majority of cases involving

25
(15 U.S.C. 1052)

35
disparagement in the united States involve “scandalous matter” in accordance with Lanham
Act Section 2(a).3. False advertisement distribution is forbidden by Section 52 of the U.S.
Federal Trade Commission Act. Section 10(6) of the U.K. Trademarks Act, 1994 mentions
“honest practices,” which have long been the standard in industrial and commercial concerns
in the country. The term “unfair trade practice” has been the norm in India; it is mentioned in
Sections 2(1)(r) of the Consumer Protection Act of 1986 and 36A of the Monopolies &
Restrictive commercial Practices Act of 1969.

“In the case of, De Beers Abrasive v. International General Electric Co.4, the Court held as
follows, “The law is that any trader is entitled to puff his own goods even though such puff as
a matter of pure logic involves the denigration of his rival’s goods...Notices...reading ‘the
best tailor in the world’, ‘the best tailor in this town’ and ‘the best tailor in this street’ do not
commit an actionable offence. Where however the situation is not that the trader is puffing
his own 26goods but turns to denigrate the goods of his rival... then the situation is not so
clearcut. The statement ‘my goods are better than the goods of X is only a more dramatic
presentation of what is implicit in the statement ‘my goods are the best in the world’ and
would not be actionable. However, the statement ‘my goods are better than X’s because X’s
are absolute rubbish would be actionable.” In another case, Ellison Educational Equip., Inc
v. Tekservices, Inc5, it was held that, advertising claims that defendant’s letter-cutting
machine was the “finest”, “most flexible” and “most versatile system available today” were
not actionable qua Section 43(a) of the Lanham Act, because they constitute mere puffing.
As a matter of fact, in cases of ‘trademark disparagement’, for the purpose of adjudication of
disputes, the Courts in India have looked into the following criteria: (a) Intent of the
Commercial; (b) Meaning of the Commercial; (c) Storyline of the Commercial; and (d)
‘Ordinary Meaning’ the Advertisement renders to a ‘Man of Average Intelligence’. In the
case of, Imperial Tobacco Company v. Albert Bonnan27, the Calcutta High Court in Division
Bench held as follows: “To succeed in an action of slander of goods, the plaintiff has to
allege and prove that the statement complained of was made concerning his goods and that it
must be with the direct object of injuring his business”. Inspiration for long has been taken
by the Indian Courts from the Courts of U.K. and U.S.”

26
F. Supp. 1350 (D. Neb. 1995)
27
AIR 1928 Calcutta 1 (DB)

36
“ In the case of, Ucan Products Limited v. Hilti (Great Britain) Ltd.28, the High Court of
Justice (Chancery Division) held that in trademark disparagement cases, it is upon the
plaintiffs to make out a prima facie case that the defendants had allowed the advertisement
(under challenge) to be published when they knew it was untrue, and that the defendants
acted in a manner reckless and maliciously false. In cases of ‘malicious falsehood’ qua
trademark disparagement it is essential for the plaintiff to plead and prove that, the defendant
published about the plaintiff ‘words’ which were false; were published maliciously, and that
special damages followed as direct and natural result of the publication”.29
30
“In Pizza Hut, Inc. v. Papa John’s International Inc.9, it was held that, When the
statements of fact at issue are shown to be literally false, the plaintiff need not introduce
evidence on the issue of the impact the statements had on consumers. In such a circumstance,
the court will assume that the statements actually mislead consumers”.

“In the case of, Mc Donalds Hamburgers Ltd. v. Burgerking (U.K.) Ltd.31, followed in
Glaxosmithkline Consumer Healthcare Ltd. v. Heinz India32, it was held that,
advertisements are not be read as if they are testamentary provisions of a ‘Will’ or a clause in
some agreement with every word being carefully considered and words as whole being
compared; it was further held that, courts are to take into account, the fact that public expects
a certain amount of hyperbole in advertising and the test to be applied is whether a reasonable
man would take the claim being made as one made seriously and will have to take it with a
large pinch of salt.”

3.2. COMPARATIVE ADVERTISING:

Comparison lies at the root of modern advertising.33 - In the context of comparative

advertising and trademark disparagement, the test to be used is "whether or not a reasonable
person would take the claim being made as serious" when a trader makes a statement
disparaging of trade rival's goods. The legal framework in India concerning "comparative
advertising" in relation to "trademark disparagement" is beginning to take shape. An earlier
approach placed more focus on the issue of defamation. Nonetheless, the focus of the current

28
(1968) F.S.R. 248
29
Gorden Kaye v. Drew Robertson & Sport Newspapers Ltd., (1991) F.S.R. 62
30
F.3d 489, 56 U.S.P.Q. 2d 1246 (5th Cir. 2000)
31
(1987) F.S.R. 112
32
(MANU/DE/3273/2010)
33
See: Cornish, Intellectual Property, Fourth Edition, p.656

37
strategy is on consumer education. A great deal of inspiration has been drawn from the
following UK case law.

 “Cable & Wireless Plc v. British Telecommunications34: In this case, comparison

of price plans (qua telephone services) was advertised by the plaintiff to show that
its services are more worthy than the services offered by the defendant. The
comparison was true and thus, it was held that no trademark disparagement can be
pleaded by the defendant”.
 “Barclays Bank Plc v. RBS Advanta35: In this case, defendant came up with an
advertisement, comparing the ‘card’ issued by the plaintiff with the one issued by
the defendant. In 15 ways the comparison was carried out. The comparison was
mostly fair and honest. It was held that trademark disparagement cannot be alleged
as the comparison was fair and was in furtherance of consumer education and
protection”.
 “Vodafone Group Plc v. Orange Personal Communications Services Limited 36:
In this case, tariff plan of the plaintiff was compared with that of the defendant, the
comparison was not unfair. The comparison was true, thus it was held that no case
of trademark disparagement can be made out”.
 “British Airways Plc v. Ryanair Ltd:37 In this case, comparison of airplane fares by
the defendant with the ‘trademark-logo’ of the plaintiff was held to be honest and
fair, and in wider public interest, thus it was ruled that no case of trademark
disparagement can be made out”.

3.2.1. Position Of Law In India Concerning ‘Comparative Advertising’ And

‘Trademark Disparagement’
1. The Supreme Court of India in the Tata Press Case38 concluded that the printing of
advertising is protected by Article 19(1)(a) of the Indian Constitution as free
commercial speech. The Court went on to rule that advertising is nothing more than a
business transaction including the distribution of information about the advertised
product. The information made available through the advertisement benefits the
general public. The Court in “Tata Press Ltd. v. Mahanagar Telephone Nigam

34
1998 FSR 383
35
1996 RPC 307, Chancery Division
36
1997 FSR 34
37
2001 FSR 32
38
AIR 1995 SC 2438

38
 Ltd”39., The words stated that the open exchange of commercial information is
essential to a democratic economy and that honest and cost-effective marketing
cannot exist without the general public being educated through the dissemination of
information through commercials. The absence of "commercial speech" freedom will
be detrimental to the economic system. displaying the cases, “Indian Express
Newspapers (Bombay) Pvt. Ltd. v. Union of India40, Sakal Papers (P) Ltd. v. Union
of India41 and Bennett Coleman & Co. v. Union of India”42, the Court held that, any
restraint or curtailment qua advertisements, affects the fundamental right guaranteed
under Article 19(1) (a) of the Constitution of India, 1950.
2. The definition of "unfair trade practice," as given in Section 36A of the Monopolies &
Restrictive Trade Practices Act, 1969, and Section 2(1)(r) of the Consumer Protection
Act, 1986, can also be traced to reasonable restrictions under Article 19(2) with regard
to "commercial speech."
3. The Trademarks Act, 1999, Section 29(8) lays forth the circumstances in which using
a trademark in advertising may be considered infringement. Per Section 29(8), any
form of advertising that violates ethical standards, diminishes the unique qualities of
the mark, or harms its reputation is considered an infringement. According to Section
30(1) of the Trademarks Act, 1999, advertising that adheres to ethical standards and
does not harm the unique qualities or reputation of the mark will be deemed lawful
and will not be considered infringement. Comparative advertising is therefore exempt
from Section 29 infringement acts according to Section 30(1).
4. In the case of, Colgate-Palmolive (India) Ltd. v. Anchor Health & Beauty Care Pvt.
Ltd.43, it It was decided that an advertisement that aims to educate the public—by
showing the falsehood or deceptive nature of a claim made by a rival trade
organisation or by comparing the advantages (or disadvantages) of each company's
products—cannot be considered an actionable wrong unless two requirements are
met: it must be false and motivated by malice. No matter how much harm is done as a
result of it, the truth is always the best defence against any attack or challenge.
5. Unless there is greater awareness or government involvement, the consumer is
mislead by both when trade rivals engage in "puffery" without taking aim at one

39
MANU/SC/0745/1995: AIR 1995 SC 2438
40
1985 (1) SCC 641
41
MANU/SC/0090/1961: (1962) 3 SCR 842
42
MANU/SC/0038/1972: (1973) 2 SCR 757
43
MANU/TN/0980/2008

39
 another. On the other side, the consumer stands to benefit if both are prevented from
making false, inaccurate, or misleading representations or from giving unintended
guarantees. When two competitors in the same industry honestly expose one another,
the customer benefits. The High Court of Calcutta in the matter of “Chloride
Industries Ltd. v. Standard Batteries Ltd.44 held that, if goods are disparaged
maliciously or with some other such intent to injure and not by way of fair trade
rivalry, the same would be actionable”.
6. In the case, “Boehringer Ingelheim Limited & Ors v. Vetplus Limited”, it
was decided that a trader may only get a "prior restraint order" if he can demonstrate
that there is a high probability that the trademark disparagement made by a competitor
in a comparison advertisement is inaccurate and deceptive. If he is unable to
accomplish that, his competitor should be allowed to express his true beliefs without
hindrance, in the best interests of the public as well as his own business objectives. 45
This adage has recently served as inspiration for numerous Indian court rulings on
comparative advertising-related issues. The Government of India established the
Advertising Standards Council of India in 1985 as a non-statutory tribunal. It was
established in accordance with Section 25 of the Companies Act of 1956. The
tribunal's Code of Advertising Practice (CAP) is the basis for how complaints are
resolved. "To ensure the truthfulness and honesty of representations and claims made
by advertisements and to safeguard against misleading advertisements" is the core
tenet upheld by the Code.

3.3. GENERIC DISPARAGEMENT

“Generic disparagement,” to put it plainly, is not disparagement. Courts are growing wary of
this strategy, though. The case of S.C. Johnson & Son, Inc. v. Buchanan Group pvt Ltd” 46.
Implicitly demonstrates the prudence that the courts have begun to exercise. In this instance,
the respondent denigrated the plaintiff’s products by asserting that theirs was a higher-quality
item. The respondent used a container that was eerily similar to the plaintiff’s product to
illustrate this connection. The reply contended that the analogy was “generic.” The court
determined that the comparison was implicit (innuendo) and not general. Disparaging
remarks about the plaintiff’s product were upheld because they presented it in a negative
light. The complainant’s goods sales numbers were given significant weight by the court in
44
(Decided on 30-091994, Unreported)
45
Boehringer Ingelheim Limited & Ors v. Vetplus Limited, (2007) EWCA Civ. 583
46
CS(OS) No. 2173/2009, High Court of Delhi (New Delhi)

40
assessing the impact of the derogatory advertisement. In addition, the court determined that
“a word is said to not have been used generically if it is used to describe the competitor’s
product, attempting to indirectly insinuate such product; the product insinuated should have
strong resemblance with the insinuator’s product” in the case of “Unibic Biscuits India (P)
Ltd. V. Britannia”47 Industries Ltd. In this instance, the appellant developed a product tagline
that was advertised: “Why to have good day, when you can have a great day.” The
respondent claimed that by using this phrase, the respondent’s product, Good-Day, had been
disparaged. The appellant argued that since the terms “good” and “great” are general, there is
no derogatory intent. The Karnataka High Court ruled against the appellant, finding that there
had been disparagement. The issue in the “Dabur India Ltd. v. Emami Ltd”48. case centred
on an advertising created by Emami to disseminate the word that consuming chyawanprash, a
health tonic, during the summer is bad for your health. The commercial was upheld as being
suggestive even though it made no specific mention of Dabur and the criticism it included
was “generic.”

3.4. PUFFING V. TRADEMARK DISPARAGEMENT:

"Puffing" is defined as "the expression of an exaggerated opinion—as opposed to a
factual misrepresentation—with the intent to sell a good or service; puffing involves
expressing opinions, not asserting something as a fact" in Black's Law Dictionary, Eighth
Edition. While there is considerable room for creativity while marketing items, a vendor
is not allowed to misrepresent them or claim that they have qualities that they do not..49
“The law, generally speaking, recognises that trades-men and manufacturers can
commend their goods and state that they are better than those of rival traders. Yet, this is
with an added caution that the publisher or advertiser should not make any false
representation as to the quality or character of the rival or competitor’s goods or
products. If no such false representation as to the quality or character of the rival’s goods
is made, then the advertisement of the tradesman, however commendatory or
exaggerated cannot result in an actionable claim. Exaggerated claims sans such false
representations are known as puffing”. 50 “In the case of, Bubbuck v. Wilkinson515253, it
was observed that, mere statement that the defendant’s goods are better than that of the
47
MANU/KA/0240/2008
48
2004 (29) PTC 1 (Del)
49
See: Colgate Palmolive Co. & Anr. v. Hindustan Unilever Ltd., 2014 (57) PTC 47 (Del), Para 25
50
See: Hindustan Unilever Limited v. Reckitt Benckiser India Limited, (2014) 207 DLT 713, Para 34
51
1899 (1) OB 86
52
AC 1
53
AC 154

41
 plaintiff’s would not be actionable. Further, in the case of, Allen v. Flood30, it was held
that, mere puffing would not be actionable because it would ‘open a very wide door to
litigation and might certainly expose every man who said his goods were better than
those of others to the risk of action’. In White v. Mellin31, it was held that, puffing is
permissible, if not then indeed the Courts of Law would be turned into machinery for
advertising rival productions by obtaining judicial determination which of the two was
the better”.
Passing Off v. Trademark Disparagement: When someone disparages another person's
product under trademark law, they are not attempting to make their own product
comparable to the product that is being disparaged; rather, they are attempting to set their
product apart from the product that is being disparaged. Making the "disparaged product"
seem as close to or similar to the competitor's product is the goal of disparagement. Thus,
the analogies between "passing off" and "disparagement" are not the same. As of right
now, the law permits all traders to advertise their goods, even when doing so logically
involves disparaging competitors' goods..54 A passing-off action protects the plaintiff's
goodwill and reputation, which the defendant's misrepresentation is likely to harm, rather
than the plaintiff's proprietary right in the name or get-up that the defendant has
wrongfully appropriated. Passing off is a wrongful invasion of the plaintiff's property. 55
“In the case of, Perry v. Truefitt56, Lord Langdale MR summed up the rationale for
‘passing-off’ action as follows- “A man is not to sell his own goods under the pretence
that they are the goods of another man; he cannot be permitted to practice such a
deception, nor to use the means which contribute to that end. He cannot therefore be
allowed to use names, marks, letters or other indicia, by which he may induce
purchasers to believe, that the goods which he is selling are manufactured by another
person. Unlike in cases of trademark disparagement, in cases of ‘passing off’, the
claimant has to establish the following- (a) the claimant has ‘goodwill’; (b) the defendant
made a ‘misrepresentation’ that is likely to deceive the public; and (c) the
misrepresentation damages the goodwill of the claimant”.57

54
See: Colgate-Palmolive (India) Limited v. Anchor Health and Beauty Care Private Ltd., 2009 (40) PTC
653
(Mad)
55
See: Harrods v. Harrodian School, (1996) RPC 697
56
(1842) 6 Beav 66; 49 ER 749
57
See: Lionel Bently & Brad Sherman, Intellectual Property Law, Chapter 32: Passing Off, Oxford
University Press, Third Edition, p.726-728

42
3.5. TESTING TRADEMARK DISPARAGEMENT

In general, a claim of disparagement is evaluated based on two factors: (a) whether a

reasonable person would view the claim as serious; and (b) whether the defendant has
specifically accused the plaintiff of a defect or shortcoming in the plaintiff's products,
which the plaintiff contests. Courts all across the world have developed a number of
standards to identify trademark disparagement, with the particulars of each case
determining the standard. To put it in admirable terms, the Court in the instance of,
Gillick v. Brook Advisory Centres58, held as follows: “The Court should give the article
(or advertisement) the natural and ordinary meaning which it would have conveyed to
the ‘ordinary reasonable reader’ reading the article (or advertisement) once.
Hypothetical reasonable readers should not be treated as either naive or unduly
suspicious. They should be treated as being capable of reading between the lines and
engaging in some loose thinking, but not as being avid for scandal. The Court should
avoid an over-elaborate analysis of the article, because an ordinary reader would not
analyse the article as a lawyer or accountant would analyse documents or accounts.
Judges should give regard to the impression the article (or advertisement) has made
upon them, in considering what impact it would have made on a hypothetical reasonable
reader.”

The ruling in Lewis v. Daily Telegraph Ltd. (following Lord Reid) held that the court has
the authority to determine meaning in disparagement cases when a judge sits without a
jury and that evidence regarding the meaning to others is inadmissible. The legal
presumption is that the average man does not live in an ivory tower and is not
constrained by the rules of construction, so he is free to read between the lines using his
general knowledge and experience of worldly affairs. This understanding of what an
average man would infer in the absence of special knowledge is commonly referred to as
the natural and ordinary meaning of the word. The case of the Australian High Court in
the case of, “Vodafone Group Plc v. Orange Personal Communications Services Ltd.59
Reader’s Digest Services Pty Ltd. v. Lamb60, held that, Lord Selborne’s ‘reasonable
men’ (Capital and Counties Bank v. Henty,61; Lord Atkin’s ‘rightthinking members of

58
(2001) EWCA Civ. 1263
59
(1997) F.S.R. 34
60
(1982) 150 CLR 500
61
1882) LR 7 App Cas 741, 745

43
 society generally’ (Sim v. Stretch,62; and Lord Reid’s ‘ordinary men not avid for scandal’
(Lewis v. Daily Telegraph Ltd.63, signal to the fact that in ‘trademark-disparagement’
cases, courts are not to adopt ‘too-literal’ an approach; for courts are to presume
consumers (or audience) to be agile and pragmatic, capable of making choices best suited
for themselves. Thus, in trademark disparagement cases, two-point agenda should be, the
determination of: (a) the meaning of the words used (the imputation) and, (b) the
defamatory character of the imputation. 64 Disparagement should be judged based on the
shared moral or social standard, common to society generally. 65 Words of Lord Diplock
in Erven Warnink, B.V. v. Townend & Sons (Hull) Ltd.41, are worth pressing, “it is
always better that the economic battles are kept confined to the market place”.

3.5.1. Single Meaning Rule & Multiple Meaning Rule:

“The ‘single meaning rule’ adopted in the law of defamation (qua disparagement) in
strict sense of the term is highly artificial; given the range of meanings the impugned
words sometimes bear.66 The argument in favour of the "multiple meaning rule over the
"single meaning rule is this: although different readers may interpret the same words in
different contexts, the law only assigns one meaning to each word (qua the context). As a
result, interpretation of the words qua the context in which they are expressed forms the
necessary foundation upon which the adjudication shall rest. The U.S. Federal Circuit
typically permits registration of a mark with a twofold meaning, choosing the
interpretation which is neither immoral or scandalous, to support the "multiple meaning
rule" against the "single meaning rule"67
The single m”aning rule in defamation (qua disparagement) was observed in Paragraphs
40 and 43 of the judgement in the case of Ajinomoto Sweeteners Europe SAS v. ASDA
Stores Limited. This rule is the result of historical accident that has resulted in a fiction
that assumes that the reasonable man will understand a particular statement in only one
way—the supposed single natural and ordinary meaning. Applying the single meaning

62
(1936) 52 TLR 669, 671)
63
(1964) AC 260
64
See: Byrne v. Deane, (1937) 1 KB 818, 833
65
See: Miller v. David, (1874) LR 9 CP 118; Myroft v. Sleight, (1921) 90 LJKB 883; Tolley v. J.S. Fry &
Sons Ltd., (1930) 1 KB 467, 479
66
See: Exposition by Lord Nicholls in Bonnick v. Morris, (2003) 1 AC 300; Exposition by Diplock LJ in
Slim v. Daily Telegraph Ltd., (1968) 2 QB 157, 171-172
67
See: Thomas McCarthy, McCarthy on Trademarks and Unfair Competition, Fourth Edition (1999),
19:77 44 (2010) EWCA Civ. 609

44
 rule has the ability to unduly tip the scales against one party and leave the other without
recompense in situations where justice would dictate that they should. In the midst of the
debate over the “single meaning rule” and “multiple meaning rule,” and which should be
adopted and which abandoned, the Supreme Court of South Australia set the proper
precedent in “Entienne v. Festival City Broadcasters”68, held as follows: “To insist
upon an innocent interpretation where any reasonable person could, and many
reasonable people would, understand a sinister meaning is to refuse reparation for
wrong that has in fact been committed.” Similarly, Neill LJ, in “Hartt v. Newspaper
69
Publishing Plc” maintained that the reader should be assumed to be rational and not
choose one incorrect interpretation when there are several, non-defamatory
interpretations available. In contrast to the single-meaning rule, the law accepts the
multiple-meaning rule as the appropriate approach in trademark disparagement cases.

3.6. ADJUDICATORY TREND- TRADEMARK DISPARAGEMENT IN INDIA

The decision rendered by the Calcutta High Court in the case of, Reckitt & Colman of
India Ltd. v. M.P. Ramachandran & Ors70, has established the legal framework for
trademark infringement in India; it has grown to be regarded as authoritative and has
been in effect for more than ten years. The following are the five guiding principles
stated in the ruling: A tradesman can (a) claim that his goods are the best in the world,
even if this claim is false; (b) He can also claim that his goods are superior to those of his
competitors, even though this claim is false; (c) He can even compare the benefits of his
goods to those of his competitors in order to claim that his goods are superior to those of
others; (d) He cannot, however, claim that his competitors' goods are inferior to his own
while asserting that his own goods are superior. If he says so, he is actually disparaging
the products of his rivals. To put it another way, he disparages his rivals and their
products, which is illegal; (e) If there is no defamation of the products or the company
that makes them, then no action is brought; however, if there is, a lawsuit is brought, and
if it is filed to recover damages for defamation, the court has the authority to issue an
injunction to stop the defamation from occurring again.

68
(2001) SASC 60
69
(26 October 1989, CA, Unreported at p.15)
70
1999 PTC (19) 741

45
 “Adjudicatory trend qua India, in regards to ‘trademark disparagement’ can be traced as
follows: (1) In the case of, Pepsi Co. Inc. v. Hindustan Coca Cola Ltd.71, it was held
that, though comparative advertising is permitted but only so long as it does not discredit
or denigrate the trademark or trade name or disparages the product of the competitor; (2)
In the case of, Dabur India Ltd. v. Colgate Palmolive India Ltd72, it was held that,
generic disparagement of rival product without specifically identifying or pin-pointing
the rival product is equally objectionable; (3) In the case of, Karamchand Appliances
Pvt. Ltd. v. Sh. Adhikari Brother73, it was held that, where a rival tradesman carries on
an advertisement campaign disparaging or defaming the product of another tradesman,
the latter is entitled to the relief of prohibitory injunction; (4) In the case of, Dabur India
Ltd. v. Wipro Limited,74), it was held that, it is permissible for an advertiser to proclaim
that its product is the best even though that necessarily implies that all other similar
products are inferior; (5) In the case of, Unibic Biscuits India (P) Ltd. v. Britannia
Industries Ltd.75, the Karnataka High Court held as follows: comparative advertising is
permissible, only if, such an advertising does not disparage or denigrate the trademark
of the competitor; right to advertise does not permit to go extravagant, so much so, that
the product of the competitor is put to irreparable loss or damage; and ‘balance of
convenience’ lies more in favour of the party that will be put to great hardship, if
temporary injunction is not granted; (6) In the case of, Dabur India Ltd. v. Colortek
Meghalaya Pvt. Ltd.76, it was held that, in view of the law laid down by the Supreme
Court of India in the case of Tata Press Ltd. v. MTNL77 it can be held that false,
misleading, unfair or deceptive advertising is not protected commercial speech and the
earlier judgments holding that a tradesman is entitled to declare his goods to be the best
in the world, even though the declaration is untrue and to say that his goods are better
than his competitors’, even though such statement is untrue are no longer good law. It
was further held that ‘hyped-up’ advertising may be permissible, but it cannot transgress
the grey areas of permissible assertion, and if does so, the advertiser must have some
reasonable factual basis for the assertion made; it is not possible for anybody to make an
‘off the cuff’ or ‘unsubstantiated’ claim that his goods are the best in the world or that his

71
2003 (27) PTC 305 (Del) (DB)
72
2004 (29) PTC 401 (Del)
73
2005 (31) PTC 1 (Del)
74
2006 (32) PTC 677 (Del
75
MANU/KA/0240/2008
76
(2010) 44 PTC 254 Del (DB)
77
(1995) 5 SCC 139

46
 goods are better than that of a rival; (7) In the case of, Hindustan Unilever Limited v.
Cavincare Private Limited78, it was held that every disparagement is not actionable and
for disparagement to be actionable it should be brought within the tort of malicious
falsehood and the plaintiff should as such be shown to have suffered special damages.”79

3.7. REMEDIES QUA TRADEMARK DISPARAGEMENT

The person who claims they have been the victim of trademark infringement has two
options for redress: they can seek damages or an injunction. In the event that the
opposing party can demonstrate trademark disparagement and demonstrate that the
opposing party has experienced financial losses, a claim for damages will be made.
Regarding the instance of, Niche Products Limited v. Mac Dermid Offshore Solutions
LLC80, itwas decided that there is a presumption of a connection between the claimant's
economic interest and the alleged falsehood in the defendant's advertisement if the
statement published as part of the advertisement is likely to cause financial harm to the
plaintiff. Before agreeing to award the suffering party monetary damages, the court will
consider the following: (a) the words that form the basis of the claim have the potential
to cause trademark disparagement, product denigration, and insinuation; (b) the
claimant's trademark is disparaged as a result of the insinuating words being published.
The most crucial consideration in determining the proper damages for reputational harm
is the seriousness of the libel; the more directly it affects the complainant's honour,
courage, loyalty, professional reputation, or integrity, the more serious it is likely to be.
A libel published to millions of individuals has a higher potential to inflict harm than a
libel published to a small number of persons, thus the extent of publishing is also highly
important. Therefore, the amount of damages for trademark defamation will vary
depending on the specific facts and circumstances of each case. A crucial note to
remember is that when damages are sought, they are not only being sought for the harm
the complainant's reputation endures, but also for the mental suffering the complainant
experiences as a result of the defendant's insistence that its claims are true and that it
owes the complainant no apology. If the plaintiff can demonstrate that the balance of
convenience is on his side and that refusing to grant him the temporary relief (in the form
of an injunction) will cause him irreversible loss and harm, then there will be a case for

78
2010 (44) PTC 270 (Del)
79
See: 48 (2013) EWHC 3540 (IPEC)
80
Marico Limited v. Adani Wilmar Ltd., 2013 (54) PTC 515 (Del), Para 3 & 4

47
 the award of an injunction. If the court determines after carefully reviewing the case's
facts that the defendant's published advertisement speaks the truth and there is no
evidence of deliberate deception or malice regarding trademark infringement, then no
injunction will be granted..81 In the case of, Boehringer Ingelheim Limited & Ors v.
Vetplus Limited82, it was held that, “The court normally considers who is actually likely
to win and grants or refuses an interim injunction on that basis. For if the plaintiff is
likely to win and the court foresights the damage to be irreparable, injunction will be
granted; if not, no injunction will be granted”. In the case of, American Cyanamid v.
Ethicon83, The judge held that if the judge determines that the balance of convenience
demands it and there is a significant matter that needs to be tried, the injunction should
be given.

3.8. CONCLUSION

Determining "what" is considered trademark disparagement is more of a factual than a

legal process. The following guidelines on "trademark disparagement" are derived from
the analysis above: (a) The content complained of should be given by the court the
natural and ordinary meaning that it would have conveyed to an average reasonable
reader reading the article or watching the programme once; (b) The reader or viewer in
question is not naive nor overly suspicious. He is able to interpret context. Compared to a
lawyer, he can read an implication more easily and may think a little loosely. However,
he must be regarded as a man who is not drawn to controversy and who does not, and
should not, choose one incorrect interpretation when there are other, non-defamatory
interpretations available; (c) The court should exercise caution when analysing the
material at hand while focusing only on what the defendant has actually said or written.
(d) A reasonable reader does not afford a newspaper item the analytical attention that a
lawyer gives to a document's meaning; an auditor gives to the interpretation of accounts;
or an academician gives to the content of a scholarly article; (e) The court is entitled, if

81
In the case of, Godrej Sara Lee Ltd. v. Reckitt Benckiser (I) Ltd., 2006 (32) PTC 307, the High Court of
Delhi concerned itself with an advertisement in which an insecticide (‘MORTEIN’) was shown to be more
effective in destroying cockroaches and mosquitoes than the plaintiff’s product (‘HIT’), which had two versions,
one for cockroaches and the other for mosquitoes. A.K. Sikri, J., refused the grant of injunction on the ground
that the plaintiff was guilty of concealment of material facts and also on the ground that the advertisement just
highlighted the product of the defendant as better than that of the competitor.
82
(2007) EWCA Civ. 583
83
(1975) AC 396

48
 not required, to consider the impression that the material complained of made on the
hypothetical reasonable reader; (f) The court should not take the material too literally..84

It can be stated quite precisely that, in the interest of freedom of speech and expression,
courts should refrain from limiting the publication of statements that are allegedly
defamatory, whether they are personal or trade libels. This is especially true when the
defendant claims he will defend the use of the statements, claiming they are truthful and
non-defamatory, unless the court finds the statements to be blatantly false and
defamatory..85

After grasping the notion of trademark disparagement, it's critical to distinguish

comprehensibly between "disparagement," "puffing," and "passing-off." Furthermore,
the following must be kept in mind in order to ensure that the law regarding trademark
disparagement advances positively: Comparison is the foundation of modern advertising,
"commercial speech enjoys the necessary protection under Article 19(1) (a) read with
Article 19(2) of the Constitution of India, 1950," and "generic disparagement as such is
no disparagement."

84
See: Tesla Motors Ltd., Tesla Motors Inc. v. British Broadcasting Corporation, MANU/UKWA/0169/2013:
(2013) EWCA Civ. 152; Skuse v. Granada TV, (1996) EMLR 278; Jeynes v. News Magazines Ltd., (2008)
EWCA Civ. 130 (Unreported); Colgate Palmolive Co. & Anr. v. Hindustan Unilever Ltd., 2014 (57) PTC 47
(Del), Para 37
85
See: Bestobell v. Bigg, (1975) FSR 421

49
 CHAPTER 4

REGULATION OF ADVERTISEMENT THROUGH VARIOUS LEGISLATIONS

4.1. INTRODUCTION

The battle to sell one's goods or services has gotten fierce in India due to the increasing
presence of huge brands, merchants, and service providers. The advertising medium is the
most effective tool for reaching consumers, and the victor of this race will decide the fate of
the business. The Indian corporate establishment is now largely supported by advertisements,
commonly called commercials. As Indian audience members, we encounter ads on a regular
basis, perhaps as often as once per few seconds. Everywhere we look, from hoardings on
highways to commercials on famous websites like YouTube, we are inundated with
advertisements attempting to sell us something.
Ads, and the manner they are presented inside them, have obviously expanded tremendously
in recent years. As they want to attract a large customer base, many sellers and service
providers engage in methods that hurt their consumers' interests or include improper content
in their ads. Now more than ever, there is an urgent need to regulate the domain in order to
protect consumers and make sure that ads adhere to local laws and standards in India.
There have been significant legislative efforts to safeguard consumers ever since
independence. In an effort to guarantee that buyers obtain a good bargain, several statutes
have been passed to place various duties on manufacturers and anybody involved with
tradable goods. Ads that are obscene, vulgar, misleading, unjust, or otherwise untruthful are
prohibited by several of these laws. Many statutes, court decisions, and directives from quasi-
judicial agencies, such as the Monopolies and Restrictive Trade Practices Commission,
Consumer Redressal Forums, and different Governmental Codes, make up our country's
advertising law. The purpose of this chapter is to provide a unified overview of the legislative
and regulatory frameworks that govern commercial advertising. Thus, this article will
endeavour to offer a synopsis of all significant advertising laws with the exception of the
Consumer Protection Act of 1986 and the Monopoly and Restrictive Trade Practices Act of
1969.

50
4.2. CONSTITUTIONAL ANALYSIS OF COMMERCIAL ADVERTISEMENT IN
INDIA

India, like other welfare states, has enacted a plethora of consumer protection laws and
regulations to shield its citizens from the scams and exploitation perpetrated by dishonest
businesspeople. It is the state's constitutionally mandated duty to ensure consumer justice for
its inhabitants. Even though it isn't explicitly stated in the Indian Constitution, consumer
justice is a part of the state's obligation to ensure its citizens' access to economic, social, and
legal justice. Everyone needs to understand that consumer justice is a subset of justice, which
is a larger concept. Enforcing consumer rights and ensuring high-quality, appropriately-sized
products are the goals of consumer justice. Social and economic fairness will remain elusive
so long as consumers continue to receive subpar goods and services despite paying a
premium for them. Safeguards against various forms of market operator malfeasance and
exploitation, the occurrence of which ultimately impacts individuals negatively, are also
integral to the idea of consumer justice. Consumer justice also encompasses the idea of
resolving consumer complaints and seeking reparation and recompense. Another way of
looking at it is as a component of social justice, as both aim to alleviate the hardships faced
by society's most vulnerable members and bring them closer to full equality so that they can
have dignified lives. Achieving a substantial degree of economic equality in the market is
both a legitimate expectation of consumers and a constitutional goal. Given their unequal
bargaining position compared to manufacturers, traders, sellers, and distributors, consumers
require legal protection. Social justice provides a means to achieve this goal. Establishing
economic democracy and a "Welfare State" are the goals of consumer justice, which is a
component of economic justice. The concept of "distributive justice," as outlined in Articles
38 and 39 of the Indian Constitution, goes by another name. It should be mentioned that
distributive justice is often associated with resolving economic inequities that arise from
unequal transactions and interactions within society.
Throughout the Preamble, Fundamental Rights, and Directive Principles of State Policy, the
notion of consumer justice is present and echoed. The State is obligated to promote the
welfare of the people by establishing and safeguarding a social order in which all institutions
of national life are informed by social, economic, and political justice, as stated in Article
38(1) of the Constitution. The right to a sufficient means of subsistence for all citizens is a
specific concern, and the state must shape its policies accordingly. The State, in its role as
custodian of society's wealth and natural resources, ought to possess or exercise control over

51
them. Additionally, the state has an obligation to shape its policies in a way that promotes the
equitable distribution of community material resources for the benefit of all. The economic
system must function in a way that prevents the disproportionate accumulation of wealth and
power. Thus, the State is obligated to shield consumers against the monopolistic and
exploitative tactics of large, corrupt corporations. Beyond this, the State is obligated by the
Constitution to work towards improving the well-being and strength of the workforce and
guaranteeing people a good quality of life. It needs to work on improving people's nutrition
and living conditions while also protecting children from exploitation. It is the responsibility
of the state to ensure the preservation of the country's forests and wildlife, as well as to work
towards improving the environment. It is the State's responsibility, according to Article 39-A,
to make sure that the justice system works for everyone and that no one is disadvantaged
financially or otherwise in their pursuit of justice. This includes making sure that appropriate
laws and programmes provide free legal aid.

4.2.1Competency of legislature
When it comes to consumer issues and commercial advertising, Articles 245–255 of the
Constitution govern the legislative competence of both the federal and state legislatures. The
Union List, the State List, and the Concurrent List are the three parts of the Constitution that
break out the authorities of the federal government and the individual states. There are 97
topics that make up the Union List. Defence, international relations, finance, money and
coinage, union levies and taxes, and other matters of national significance are included in the
Union List. The constitutional revisions removed items 19, 20, 29, and 36 from the State List,
which originally contained 66 subjects. Agriculture, forests, fishing, education, public health
and sanitation, local administration, state taxes and duties, and public order and police are all
examples of matters of local concern. The subjects included in the State List are exclusively
subject to state lawmaking authority. About forty-seven topics make up the Concurrent List.
The revisions to the constitution have introduced new entries 11-A, 17A, 17-B, 20-A, and 33-
A. Subjects included in the Concurrent List are those over which both the federal and state
governments have the authority to pass laws; nevertheless, in the event of a dispute between
these two bodies' legislation, the federal law shall take precedence. Given that the majority of
items pertaining to consumer protection are already included in either the Union List or the
Concurrent List, Parliament should not find it difficult to pass legislations on various aspects
of consumer protection, even though consumer affairs is not explicitly mentioned in any of
the three lists. Transportation networks such as railroads, highways, ports, ships, planes, and

52
motorboats transport people and products around the country. Items that belong in List I
include banking, insurance, bills of exchange, checks, etc., censorship of films, taxes on
goods or passengers at terminals, transportation by rail, sea, or air, taxes on railway
transactions and freights, and crimes against the law pertaining to any of the matters in List I.
Also included in the Concurrent List are consumer-facing matters such as crimes and
criminal procedures, food and product adulteration, poisons and drugs, commercial and
industrial monopolies, trusts and combines, the law, medicine, and other professions, price
regulation, trade and commerce, the manufacturing, distribution, and storage of food products
(including edible oil seeds and oil), electricity, newspapers, books, printing presses, etc.
Within the bounds set by the Constitution, these are the matters upon which the legislative
branches of the federal government and the individual states can pass laws.
Commercial advertising on radio, television, and the Internet is all within Parliament's
purview because of its authority to pass laws pertaining to telephones, wireless broadcasting,
and similar forms of communication. In addition to this, Parliament has the power to pass any
legislation pertaining to taxes on newspaper sales and advertisements.

4.2.2. Media Freedom and Advertisement

Newspapers rely heavily on advertising to fund their operations, and the government
frequently distributes a large number of ads to various publications. Using this loophole, the
government can censor news outlets that don't toe their line. Nevertheless, in instances such
as Dainik Sambad v. State of Tripura, the court determined that the press freedom would be
compromised by unequal distribution of government advertisements, in violation of Article
14 and Article 19(l)(a). The court ruled in the Enadu Case (Ushodaya Publication v. State of
Andhra Pradesh) that the government has the authority to select which newspapers run
advertisements and that media do not have the right to request such ads from the government.
In the case of Hamdard Dawakhana v. Union of India, the highest court in India considered
the question of whether or not limitations on advertisements infringed upon the basic right to
free expression. Article 19(l)(a) guarantees the right to free speech, however the court ruled
that commercial ads fall under the category of trade and commerce. The Supreme Court's
decision in Tata Press Ltd. v. Mahanagar Telephone Nigam Ltd. upheld the right to free
speech and expression, including the right to advertise, under Article 19(a), and established
that only Article 19(2) could place limitations on such ads.
Private media outlets are not required by law to air commercials for every advertiser or
advertising agency that submits a bid. On the concept that the media also bears responsibility

53
for the advertising that are published, the media generally have the authority to refuse to print
or broadcast an advertisement. It is possible to hold the media accountable for ads that violate
advertising laws or ethical standards. Businesses have the right to avoid dealing with
unwanted customers, people have the right to free speech under the First Amendment, and in
this case, the rejected advertiser does not have a right to publication under the First
Amendment, so it is acceptable to refuse to publish or broadcast their ad. A newspaper is
more than just a vessel for news, commentary, and advertisements; the US Supreme Court
has emphasised these rights. Publishers of all kinds of media, including newspapers, have the
freedom to choose the stories they run in their publications. Even if the media has a near
monopoly in a certain area, people still have the right to refuse, although history in the US
has proven that this right is not absolute. The question is whether the plaintiff could not,
given the available resources, design a reasonable substitute for the defendant's
establishment. Since the rival had access to a "viable alternative" advertising medium, the
court in Twin Labs., Inc. v. Weider Health & Fitness ruled that the publisher was not
obligated to run the ad. Advertising hoardings on public buildings, streets and vehicles is
common practice for both large corporations and individuals. Citizens have been fighting
against local authorities' practice of randomly approving hoardings in recent years due to the
fact that these structures can be unsightly, pose traffic problems, and limit the use of historic
buildings. Hoarding owners contested Section 326-J of the City Municipal Corporation Act,
1998, in P. Narayana Bhat v. State of T.N., which limited clearly visible hoardings that posed
a threat to or impeded the safe flow of traffic. It was only determined that authorities might
refuse a licence or remove a hoarding if it was determined to be dangerous or impeded the
safe movement of vehicles, according to the Supreme Court. The respondent's trademark was
deemed an advertisement under Section 328 of the Bombay Municipal Corporation Act,
1888, according to the Supreme Court's decision in Municipal Corpn.of Greater Bombay v.
Bharat Petroleum Corpn. Ltd. In order for a display to be considered a "advertisement" under
Section 328-A, the court ruled that it must have a commercial purpose and provide some
indication of the displayer's economic activities. Novva Ads.v. Deptt.of Municipal Admn.
and Water Supply upheld the constitutionality of the challenged regulations, finding that they
did not infringe upon any right to free speech, including the right to advertise. Because the
license-granting authorities had overstepped the boundaries of the writ petition, the Supreme
Court reversed the High Court's decision in Supri Advertising and Entertainment (P) Ltd. v.
Anabita Pandole. A citizen of Aurangabad in the case of Sunil Pandharinath Jadhav v. State
of Maharashtra wanted the city's prohibition on illegal hoardings enforced. Hoardings erected

54
without the Municipal Commissioner's approval were declared unlawful and subject to
removal by the court. The perpetrator was duly penalised in accordance with the Maharashtra
Prevention of Defacement of Property Act, 1995. In order to remove unlawful hoardings,
banners, and posters, the court recommended the establishment of a nodal agency. The
Municipal Corporation was given the task of finding areas that may be used for hoardings
and then auctioning them off to the highest bidder. Newspapers routinely feature photos of
politicians posing for pictures, as political advertising has grown incredibly large in recent
decades. Advertising or glorification of the government at the expense of taxpayers is a
legitimately supported right. Occasionally, more newsprint is consumed by the government
than by actual news, making it the biggest advertiser in the nation. Nevertheless, it is
necessary to address the subject of whether the government can justify political advertising as
a means of self-promotion through the use of taxpayer funds. The publication of images of
political leaders or other notable individuals was restrained by a Supreme Court Bench in the
case of Common Cause vs. Union of India. Free speech and commerce are not infringed
upon, according to the Delhi High Court's ruling, by the Model Code of Conduct's limitations
on political advertisements. False or deceptive statements made regarding another person's
goods in order to discourage people from purchasing such items are known as disparagement.
Article 19(1)(a) of the Constitution protects advertising as commercial communication,
which is not to be untrue, misleading, unfair, or deceptive. The law of disparagement is based
on these principles, along with the fact that advertisements might have some ambiguity while
still glorifying a product. No advertisement can claim protection if it crosses the line into
being untrue, misleading, deceptive, or unfair.

4.3 COMMERCIAL ADVERTISEMENT AS FUNDAMENTAL RIGHT

All people, regardless of citizenship status, are protected by a number of fundamental rights
enshrined in India's constitution. Here, the most important fundamental rights are those
protecting the right to freely express oneself (including through the press) and one's choice of
career path, place of employment, or place of business. The availability of the freedom of
speech and expression guaranteed by Article 19(l)(a) of the Indian Constitution is called into
question by commercial advertising. The issue is whether or not a seller or manufacturer has
the legal right to use print or digital media to promote their wares. This question's response is
conditional on the following: (a) whether or not the First Amendment protects commercial
advertisements; and (b) whether or not In the case of Hamdard Dawakhana v. Union of India,

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the Hon'ble Supreme Court was asked to evaluate this matter in light of the challenge to the
legality of the Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954.
Commercial advertisements are not protected by this clause because they do not pertain to
freedom of speech and expression but rather to trade and business. Additionally, these ads do
not propagate any ideas - social, political, or economic. However, the Supreme Court, via
Justice Kapur, acknowledged that advertising falls within the ambit of Article 19(1) (a). It is
respectfully argued that the Supreme Court's decision, as stated above, went beyond what was
necessary for the case and had an impact on the freedom to print all commercial
advertisements. The legitimacy of the challenged Act, which seeks to outlaw self-medication
and self-treatment, and the ability to market banned substances were the primary issues in the
particular case. However, the Court did make several observations that were not requested in
order to reach a decision on the matter. The foundation of our economic system is
advertising, as we have previously mentioned elsewhere. Advertising, which is essential to
free media since it covers the majority of costs and ensures that the media are accessible to a
large audience, is also crucial to a democratic society's free economy. A significant amount of
the expense of publically distributed newspapers is covered by it. Therefore, there is no
controversy over the valid reason that the impugned advertisement does not belong to
commercial speech protection because it is not in the general public interest. However, it is
overlooked that commercial advertising has actual and potential advantages in a democratic
country like India, where the press is revered as the fourth pillar of democracy.
A Constitution Bench of the Supreme Court ruled in Sakal Papers (P) Ltd. v. Union of India
that the "freedom of speech and expression" clause should be expanded to include the
publication of advertisements. The court deemed Section 3(1) of the Newspapers (Price and
Page) Act, 1956 unconstitutional because limiting advertisements would lead to a decrease in
newspaper circulation, which would violate Article 19(1) (a) of the Indian Constitution. The
arguments that the Court rejected included the following: that advertising is not a trading
activity, that cutting down on ads would not be considered an infringement of right under
Article 19(1) (a), that the right to "freedom of speech and expression" or the right to
disseminate news and views cannot be exercised lawfully, and that cutting down on ads
would be more effective than increasing newspaper prices. Given that Section 3(1) of the Act
allows for the allocation of space to advertisements, the Supreme Court reasoned that this
directly impacts freedom of circulation. Cutting down on ad space will drive up the price of
the newspaper. The circulation will inevitably decrease if that occurs. Reducing advertising
would have this effect, not in the distant future. According to the Court's ruling, newspapers

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would face a decline in revenue if ad space were to be limited. This would force them to
either run at a loss, shut down, or increase their prices. Unfair competition is supposedly the
goal of the Act's regulation of advertising space. So, it's aimed squarely at newspaper
circulation. The right to freedom of expression, as protected by Article 19(l) (a), would be
directly violated whenever a law is enacted with the intention of accomplishing this.79
Bennett Coleman and Co. v. Union of India is another case where the supreme court made
comparable remarks. This case involved a challenge to the validity of the 1972–73 Newsprint
policy, with the argument that it violated several parts of the Indian constitution, specifically
Articles 14 and 19(l)(a). "Article 19 will not rescue the law that imposes an excessive and
prohibitive burden on the circulation of a newspaper," the Court ruled (2). A higher price for
paper is associated with a smaller ad area. There will be a decrease in circulation if the price
increases. The court in the Sakal Papers Case ruled that this was an inevitable result of the
advertising ban. It has been firmly established by this court that the freedom of speech and
expression includes the freedom of newspapers to publish and distribute an unlimited number
of pages. Any limitation on this freedom, or on anything necessary for it to function, is a
violation of that freedom. Restrictions on distribution, number of pages, and advertisements
would impact the fundamental rights under Article 19(1) (a) regarding propagation,
publication, and circulation, the Court added. "We are of the view that all commercial
advertisements cannot be denied the protection of Article 19(1)(a) of the Constitution merely
because they are issued by businessmen," the court said in Indian express Newspapers v
Union of India, a decision that differs from the Hamdard Dawakhana ruling. A significant
amount of the money needed to keep newspapers in circulation comes from advertising. A
democratic press cannot function without the advertising "subsidy."

4.4. ADVERTISING AS FACET OF THE CONSUMER’S RIGHT TO

INFORMATION

From the perspective of the consumer's right to know about products and services, the
constitutional question of expanding free speech to include commercial advertisements must
be investigated. At both the national and international levels, the idea of a "consumer's right"
is acknowledged. Every person has the right to be safe, to know all the information, to make
an educated decision, to have their voice heard, to receive appropriate redress, to receive
education as a consumer, to live in an environmentally healthy environment, and to have their
fundamental needs met. The Consumer Protection Act of 1986 also acknowledges the first six

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rights. To exercise additional consumer rights, one must have access to information regarding
the product's amount, quality, potency, standard, purity, and price. Customers have a right to
know about items and services that meet their needs, and commercial advertising helps them
learn about these products and services within reasonable bounds. In India, the freedom of
speech and expression includes the right to know, as well as the right to receive and impart
knowledge. Both the right of the public to receive the information in the advertisement and
the protection of the advertisement under Article 19(1)(a) of the Constitution are required
companions, according to Horlicks Ltd. & Anr. V. Heinz India Private Limited. According to
the Delhi High Court, commercial speech, including advertisements, is protected under
Article 19(1)(a) of the Indian Constitution, and the only way to limit it is by legislation
passed under Article 19(2) of the same document. The highest court in the land has
repeatedly ruled that everyone has an inherent right to the most effective means of
disseminating and receiving information, including the ability to watch television, for this
reason. In the Doordarshan cases, which include Odyssey Communication (P.) Ltd v.
Lokvidayanm Sangathan, the supreme court acknowledged the freedom to broadcast on
Doordarshan.The Supreme Court's decision in the case of Secretary, Ministry of Information
and Broadcasting v. Cricket Association of Bengali establishes that an individual's right to
access telecasting is guaranteed by Article 19(l)(a) of the Constitution. However, this right
can be limited due to the use of public property, meaning that the airwaves used to exercise
this right can be controlled and regulated by the government for reasons that do not directly
fall under Article 19(2). The fact that advertisements help spread information about who is
offering what and at what price is a crucial part of what makes them part of Article 19(1)(a).
Citizens are empowered to make informed and rational economic choices through
advertising. Receiving accurate information from advertisements is more vital than the
advertiser's right to free speech. In the case of Tata Yellow Pages, the right to acquire
information about goods and services through print media ads was explicitly acknowledged
by the Supreme Court. In this case, Justice Kuldeep Singh of the Supreme Court made the
following observation: "The public at large has a right to receive the commercial speech. A
person's rights to hear, read, and receive speech are protected under Article 19(l)(a), which
also ensures freedom of speech and expression.

4.5. REASONABLE RESTRICTIONS

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Commercial advertising freedom is now commonly recognised as an aspect of free speech.
But this liberty is not without limits. Article19(2) of the Constitution gives the government
the authority to cap commercial advertising at a reasonable level. In the case of Tata Press
Ltd. v. Mahanagar Telephone Nigam Ltd, the Indian Supreme Court emphasised this point.
Concerning this matter, the Supreme Court made the following observation: "Contrary to the
First Amendment in the US Constitution, our own Constitution specifies in Article 19(2) the
limitations that can be placed on the basic right that is guaranteed in Article 19(1) (a) of the
Constitution." "Commercial Speech" that is dishonest, unfair, misleading, and untruthful
could be subject to state regulation or outright prohibition under Article 19(2) of the
Constitution.
The concept of public order encompasses a wide range of ideas, including but not limited to
public safety, tranquilly, and peace. I. Speech that incites riots or a breach of peace; (ii) The
use of abusive, threatening, or insulting language or behaviour in any public meeting with the
intent to cause a breach of peace; and (iii) The use of sound-amplifying instruments to create
excessively loud noise in public places and streets. Another justifiable basis for limiting
commercial marketing is decency or morality. Speeches and publications that damage public
morals have been restricted by engrafting this exception.one hundred. The freedom provided
under Article 19(l)(a) is restricted by laws such as the Indecent Representation of Women
(Prohibition) Act, 1986, the Dramatic Performances Act, 1876, The Cinematograph Act,
1952, and The Press Act, 1951, among others, based on the "decency or morality" clause of
Article 19(2). Additionally, journalists and newspapers are not allowed to publish anything
that is vulgar, indecent, or objectionable to public morality, as stated in Rule 29 of the Norms
of Journalistic Conduct by the Press Council of India. In a similar vein, Rule 30 states that
newspapers must not publish ads that are obscene or that, by showing a naked or lewd
woman, attract the lecherous interest of men as if she were a product for sale.
The rule of law is based on the tenet that the court must be respected. It is unacceptable to use
the pretence of free speech to condone criticism that degrades the court. A person's right to
free speech does not include the ability to use that right to bring disrepute upon the legal
system through, say, a newspaper ad.

4.6. ADVERTISING AND INTELLECTUAL PROPERTY RIGHTS LAW

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4.6.1. The Copyright Act, 1957
With the introduction of the printing press, which allowed for the mass duplication of books,
the significance of copyright became apparent. Consequently, in 1914, the Indian Copyright
Act was enacted. However, in the last 40 years, the Indian economy has been impacted by
more modern and sophisticated forms of communication such as television, litho-
photography, and broadcasting. The satisfaction of copyright-related international
responsibilities was a necessary consequence. In order to overhaul the Copyright law, all-
encompassing new legislation needs to be passed. Parliament accomplished this by enacting
the Copyright Act of 1957. The work in which copyright exists is specified in Section 13 of
the Act. The following types of works shall have copyright in India: (a) original literary,
dramatic, musical, or artistic works; (b) cinematographic films; and (c) sound recordings, as
declared in Subsection (1) of Section 13 and subject to the other provisions of this Act. In
order for an advertisement to qualify for protection under the Act, it must be either (a)
completely unique and not reproduced from somewhere else, or (b) not previously used or
known to the public. This in no way implies that the work has to be completely novel. The
data provided
by an ad list or the ads themselves could contain it.
4.6.2. The Trade Marks Act, 1999
The Trade Marks Act, 1999 is the document that contains all of India's trademark laws. A
"trademark" is any symbol used to identify the source of a product and differentiate it from
competing brands. A trademark's advertising role is one of its many functions. Trademarks
help consumers become more acquainted with a product or service by strengthening the
emotional connection they have with them. So, trademarks help their owners increase and
maintain customer demand. Concurrently, they enlighten the buyer about the goods and
services that are accessible. Consequently, marks must not promote unfair competition in any
way and must not be confusing, deceptive, untrue, or misleading. The punishment for using
fraudulent trademarks, trade descriptions, etc. is outlined in Section 103 of the Act.
According to it any person who (a) falsifies any trade mark; or (b) falsely applies to goods or
services any trade mark; or (c) makes, disposes of, or has in his possession, any die, block,
machine, plate or other instrument for the purpose of falsifying or of being used for falsifying
a trade mark; or (d) applies any false trade description to goods or services; or (e) applies to
any goods to which an indication of the country or place in which they were made or
produced or the name and address of the manufacturer or person for whom the goods are

60
manufactured is required to be applied under Section 139, a false indication of such country,
place, name or address; or (f) tampers with, alters or effaces an indication of origin which has
been applied to any goods to which it is required to be applied under section 139; or (g)
causes any of things above-mentioned in this section to be done, shall, unless he proves that
he acted, without intent to defraud, be punishable with imprisonment for a term which shall
not be less than six months but which may extend to three years and with fine which shall not
be less than fifty thousand rupees but which may extend to two lakh rupees provided that the
court may, for adequate and special reasons to be mentioned in the judgment, impose a
sentence of imprisonment for a term of less than six months or a fine of less than fifty
thousand rupees. If you sell products or provide services using a fake trademark or trade
description, you could face penalties under Section 104.

4.7. COMPANIES ACT, 2013

As part of its mandate to streamline and update company law, the Companies Act mandates,
as stated in Section 30, that any advertisement for a company's prospectus must include the
following information: the company's capital structure, the names of the signatories to the
memorandum, the amount of share capital, the number of shafts subscribed for by each
signatory, and the objectives, liability, and amount of the company's members. Additionally,
no security offering entity may use public promotions or spread the word about their private
placement offer through any means of marketing or distribution while issuing a private
placement offer letter. In addition, the Act states that whenever a company's authorised
capital is stated in an official publication, notice, advertisement, or letter, then the same
document must also include, in a similarly prominent position and with similarly noticeable
fonts, the amount of subscribed and paid-up capital. The corporation is subject to a penalty of
10,000 rupees if it fails to comply with the requirements of subsection (1), and each officer of
the corporation is subject to a penalty of 5,000 rupees for each failure.199 Among Schedule
IV's many provisions pertaining to advertising is the Code for Independent Directors.
Independent directors might use the Code as a manual for how to act professionally in their
role. Companies, regulators, and members of the financial community (especially minority
shareholders) will have more faith in the independence of directors if they follow these
guidelines and carry out their duties professionally and faithfully. The responsibilities of non-
executive directors are addressed in Section III of the attached schedule. Without the explicit
approval of the Board or as mandated by law, independent directors are obligated to keep

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confidential information, such as trade secrets, technology, plans for advertising and sales
promotions, and unpublished price sensitive information, under seal.

4.8. CONSUMER PROTECTION ACT, 2019

Publication of the Consumer Protection Act, 2019 in the Official Gazette occurred on August
9, 2019, following the President of India's assent. The law is organised into eight chapters
and consists of 107 sections. Some of the new words used in the law's definitions include
"Advertisement," "Misleading Advertisement," "Central Authority," "Mediation,"
"Mediator," "Consumer Rights," "Regulator and Unfair Contract," "Design," "Direct Selling,"
"Director General," "E-Commerce," "Electronic Server Provider," "Endorsement,"
"Establishment," "Harm," "Injury," "Express Warranty," "Product and Product Liability,"
"Product Manufacturer," "Product Manufacturer," "Product Liability Action," "Product
Seller," and "Product Service Provider." New definitions have been added to "advertisement,"
"endorsement," "mediation," "consumer rights," "central authority," "e-commerce,"
"electronic server provider," "endorsement," "Establishment," "Harm," "Injury," "Express
Warranty," "Product and Product Liability," "Product Manufacturer," "Product Liability
Action," "Product Seller," together with "Product Service Provider." Teleshoppers, direct
salespeople, and MLMers are now also considered "consumers" because of the expansion of
the definition of "consumer" to encompass digital traders. The term "e-commerce" refers to
the practice of trading goods and services using online platforms. It is now within the
purview of the federal government to regulate online business in order to curb unfair trade
practices. When it comes to offshore e-commerce and the eventual enforcement of CPA
2019, it's not clear what will be covered. Due to two significant modifications in the law—the
addition of "unfair contracts" and the expansion of unfair trade practices—the number of
major grounds to submit complaints has been raised to seven. Any agreement between a
business and a customer that materially alters the customer's rights is considered an unfair
contract. Since banks and other financial institutions are also subject to the Act, these
regulations would have an effect on them as well. Nevertheless, the interpretation of internet
contracts by courts is an open question. The Indian Consumer Protection Act (CPA) has
broadened the definition of "unfair trade practice" to encompass three more scenarios: first,
the non-issuance or failure to issue a bill or cash memo; second, the refusal to accept
defective goods or deficient services for return or withdrawal; and third, the disclosure of
personal information about consumers to any third party, unless such disclosure is required

62
by law or is in the public interest. There is now a distinct chapter in the 2019 CPA called
"Product Liability" that explains who is responsible for faulty items. In the event that a
customer suffers harm as a result of a faulty product or inadequate service associated with a
product, the maker or seller of the product is liable for such harm. For the purpose of
clarifying who can be held accountable for an action under Chapter VI of CPA 2019, CPA
2019 specifies a product maker, product seller, and product service provider. Initiating a
product liability action requires establishing that the product in question was defective in
design, had a manufacturing defect, deviated from the manufacturing specifications, failed to
conform to the express warranty, or lacked sufficient instructions for proper usage to avoid
injury or warnings about wrong or inappropriate usage. A product seller who imports, sells,
distributes, leases, installs, prepares, packages, labels, markets, fixes, maintains, or is
otherwise involved in positioning the product for commercial purpose is also included in the
act, in addition to the definitions specified in CPA 2019. Manufacturers who also sell or
provide services fall under this category, but sellers of real estate, experts in the field,
individuals whose only role is to provide financial support for the product's sale, and those
who lease products without reasonable access to inspect them for defects are not. The goal of
India's Consumer Protection Act (CPA 2019) is to create a centralised body to safeguard
consumers from deceptive advertising and unfair business practices by establishing the
Central Consumer Protection Authority (CCPA). If a consumer complaint impacts more than
one person, the CCPA will have the authority to take suo moto steps, recall products,
mandate price refund, terminate licences, and initiate class action lawsuits. Anything that can
be delivered in its whole or in parts and made for the purpose of being introduced to trade or
commerce is considered a "product" according to the CPA 2019, with the exception of human
tissues, blood, blood products, and organs. In addition to imposing fines, the CCPA will issue
safety notices to customers about potentially harmful products and services, as well as
guidelines to avoid unfair trade practices and directions to the relevant trader, manufacturer,
endorser, advertiser, or publisher to remove or amend a misleading or false advertisement. In
accordance with CPA 2019, district collectors are now authorised to investigate matters
pertaining to consumers' collective interests. In the event of a complaint or CCPA reference,
they have the authority to conduct an investigation or inquiry. In addition to consumers
submitting complaints to resolve their issues, the formation of a centralised authority and
taking action as a class provides an extra means of relief. The maximum penalties for
manufacturers or endorsers found guilty of false or misleading marketing are two years in
prison and a fine of up to one million Indian Rupees (INR). The maximum punishment for a

63
second offence is five years in prison and a fine of five million Indian Rupees (INR).
Additionally, for up to a year, the CCPA can forbid the endorser of a deceptive commercial
from endorsing that specific product or service. The maximum length of time banned can be
three years for each succeeding infraction. The CPA 2019 omits healthcare from the term of
"service" that was previously included in the consumer protection bill that was enacted by the
Lok Sabha. Medical professionals are worried about potential abuse of the CPA 2019 due to
the Healthcare Amendment, which was introduced in Parliament to remove healthcare from
the list of services. Since healthcare services are not specifically exempt from the CPA 2019
in the amendment, they should not be removed from the category of services. In the case of
Indian Medical Association v. VP Shantha, the Supreme Court interpreted healthcare as a
service under the CPA 1986, enabling patients to sue doctors for inadequate treatment. But
once it's in effect, it's not obvious if the CPA 2019 will still be relevant. District Consumer
Forums now have jurisdiction up to 1 crore, state consumer forums from 1 crore to 10 crore,
and national consumer forums above 10 crore, according to the amended CP Act, 2019. With
the imposition of necessary substance and format for parties to attend mediation, this offers a
new framework for consumer credit while modernising its laws. In addition to laying the
groundwork for digital marketing and online purchasing, the CP Act expands customer
recourse to forums in the event of a product or service failure, regardless of whether the
purchase was made online or not.

CHAPTER 5

EFFECT OF MISLEADING ADVERTISEMENT AND THE MECHANISM FOR

READDRESSAL

5.1. INTRODUCTION

Commercials have a significant impact on how consumers behave and make judgements
about what to buy. In the current digital era, where ads are everywhere on multiple platforms,
it is crucial to make sure they are accurate and genuine. In India, deceptive or fraudulent
advertising not only confuse consumers but also sabotage fair competition and damage public
confidence in the industry. This article examines the laws that control deceptive or fraudulent
advertising in India, the penalties that apply to these violations, and the moral issues that
surround advertising.

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The Advertising Standards Council of India (ASCI) and the Ministry of Information and
Broadcasting are two regulatory entities that have published standards governing the
regulation of advertisements in India, together with the Consumer Protection Act, 2019.
Stricter rules were imposed by the Consumer Protection Act of 2019 to shield customers from
unfair business activities, such as deceptive or fraudulent advertising. Unfair trade practices
are prohibited by Section 21 of the Consumer Protection Act of 2019, and this includes
making false or misleading claims about the nature, calibre, or level of goods or services.
Furthermore, the Central Consumer Protection Authority (CCPA) is authorised by Section 24
of the Act to oversee and control ads in order to guarantee adherence to the Act's provisions.
In addition to the Consumer Protection Act, instances involving deceptive or fraudulent
advertising may also give rise to legal recourse under the Competition Act of 2002 and the
Indian Penal Code of 1860. The IPC's Section 420 addresses the offences of cheating and
dishonestly inducing the handover of property. This section may be relevant in cases where
ads lead potential customers to purchase goods or services by making false statements. In
addition, anti-competitive agreements, the misuse of a dominating position, and deceptive
marketing techniques that stifle competition are all forbidden by the Competition Act of
2002. Entities involved in unfair or deceptive advertising activities may be subject to
investigations and penalties by the Competition Commission of India (CCI).
Although deceptive or fraudulent advertising is punishable by law, ethical issues are a major
factor in determining advertising strategies and fostering consumer confidence. It is morally
required on advertisers to make sure that their messages are truthful, accurate, and open.
Among the ethical advertising techniques are: Honesty and Transparency: Instead of using
hyperbole, deceptive claims, or misleading statements, advertisers should give genuine,
factual information about their goods and services. Respect for Consumer Rights: By giving
customers accurate and pertinent information about the goods or services they are
advertising, advertisers may help consumers make well-informed decisions. Social
Responsibility: Marketers ought to think about how their messages may affect society and the
environment and refrain from endorsing dangerous or immoral goods or practices. Regulation
Compliance: To ensure compliance with legal requirements and guidelines, advertisers
should abide by applicable laws, regulations, and industry standards controlling advertising
techniques. Accountability and Integrity: Advertisers ought to maintain integrity in their
interactions with consumers, stakeholders, and regulatory bodies and accept accountability
for the content of their ads.

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5.2. ARTICLE 19 AND FREEDOM OF COMMERCIAL SPEECH

The moment we stop speaking up about issues that really matter, our lives start to come to a
close. - Martin Luther King, Jr. (regarding his stance on free speech) In addition to being
fundamental to a democratic system, There are many basic malignancies that plague states,
and freedom of speech and expression is the root cause of many of them. Therefore, the most
prominent of the fundamental rights upon which the freedom of speech and expression rests
is Article 19. The right to free expression is guaranteed in Article 19 of India's constitution.
The right to freely express oneself through diverse means is essentially what it entails.
Individuals are granted the right to speak, listen, and access information. There has been
much debate over the interpretation of commercial speech and the scope of the ability to
compel such speech, despite the apparent clarity of the Article. Examining Article 19 in
greater detail would shed light on its development and present direction. Romesh Thappar v.
State of Madras established, pragmatically speaking, that press freedom is an extension of
free speech. This encompasses the right to publicly display one's opinions by the use of signs,
images, or movies, among other things. Therefore, it is clear that Article 19 has a broad
reach. The purpose of Article 19 is to provide people the power to express themselves freely.
The original goal was to protect all forms of mass communication, but the article was initially
understood as protecting individuals' freedom of speech and expression. On the one hand, this
makes sure that people can sell their products anyway they like, whether that's by using a
slogan, jingle, assurance, guarantee, or even a celebrity's likeness. But censorship is an
acceptable limitation on freedom since it prevents consumers from having their valuables
taken away by corporations. Therefore, in order to ensure that the public has easy access, the
Supreme Court has adopted an interpretation that permits maximal coverage. Indian Express
Newspaper v. The Union of India was a case where the Supreme Court impliedly found that
Article 19 partially protected commercial speech. The court ruled that commercial ads should
be protected by Article 19(1)(a) of the Constitution, even when they are issued by merchants.
The court further declared that the goal for which an advertisement is deployed can reveal its
actual character. Cases such as New York Times v. Sullivan (1964), which brought attention
to the idea of "editorial advertisement," serve as typical examples. For this reason, the Court
has sought to grant more leeway to promote ideas like save girl child than to commercially
promote products. For example, ads for "Ban Pesticides" or "Save Whale" would fall under
this category, while ads for "use spaghetti" or "buy cars" would not. One more point: Article
19(1) (a) now includes "commercial speech" in the context of Tata Press Ltd v Mahanagar

66
Telephone Nigam Ltd. So, freedom of speech encompasses all knowledge that is so distilled
that it guarantees self-fulfillment, truth-finding, a balance between stability and change, and
enough information for a person to make decisions. By providing consumers with real
information that they may use to make an informed decision, this essentially expands the
scope of the right to free speech and expression to include the right to know. A producer
would often engage in certain routines in order to improve their business. Below, you can
find a handful of these.
5.2.1. Unfair Trade Practices
Quoted: "Advertising is legalised lying" by H.G. Hello there, A violent cycle of rivalry and
disputes characterises business at a macro level. This is clearly the case as rivals strive to
devour the success and popularity of their rivals in the market. An example of this occurrence
in the vicious market cocoon is the use of various strategies to enhance product sales, such as
marketing, offers, discounts, and promotional programmes. As a general rule, an
exaggeration is one that tricks people into purchasing a product that isn't really all that great,
but makes for wonderful advertising. Ethics in business is something that many have
forgotten about due to the allure of becoming the best. "Unfair Trade Practices" is yet another
contentious strategy by businesses. Commonly, when people talk about "unfair trade
practices," they mean when a firm uses dishonest or fraudulent means to make money, even if
it means hurting other people. A commercial practice that uses unfair methods or deceptive
techniques to promote the sale, usage, or supply of products or services is defined as such
under Section 36 A of the Monopolies and Restrictive commercial techniques Act, 1969. The
preceding clause establishes a broad scope that includes visual, textual, and verbal
representations. In addition, the section details all the ways in which the corporations might
engage in unfair business practices. In addition, the Consumer Protection Act of 1986 defines
the term as follows: "A trade practice which, for the purpose of promoting the sale, use or
supply of any goods or for the provision of any service, adopts any unfair method or unfair or
deceptive practice." This means that any business practice that serves an undesirable interest
rather than the consumer's basic interest is considered an unfair trade practice. The activities
in question may take the kind of a claim, fact, or representation about its standard, quality,
quantity, grade, composition, style, model, sponsorship, overall condition, etc., as outlined in
Section 2 (r) (i) to (iv) of the Consumer Protection Act, 1986. While this provision may have
good intentions and a noble purpose, it fails to specify which actions would not constitute
unfair trade practices. Here is where the competitor's position starts to deteriorate, since the

67
section fails to establish or indicate an exception that might work in his favour. What we have
here is more accurately described as "unfair trade practices" than "ethical business practices."
It is reasonable to assume that, from a competitor's perspective, the extensive definitions and
laws pertaining to "Consumer Protection" have little bearing on marketing, given that "Fair
Competition" is not their principal aim. Therefore, the purpose of this paper is to examine the
effectiveness of the process for offering a remedy to a competitor and to explore any potential
legislation that has been developed to address the issue of misleading marketing. The
Consumer Protection Act of 1986 obviously does not guarantee anything to a rival business.
5.2.2. Misleading Advertising
Making decisions on what to display, which products to advertise, and which stuff to hide is
an integral part of creating advertisements. Sometimes, in the midst of these choices, the
practical truth takes precedence over the pure truth, which could mislead both customers and
rivals. A definition of misleading advertising was provided by P. In his Advanced Law
Lexicon, Ramanatha Aiyar defines: "Advertising that misleads or is likely to mislead its
intended audience and, as a result, causes harm to a competitor or influences consumer
behaviour" The right to publish ads is no different from any other right in that it is not
absolute. Additionally, there are value guidelines that the ads must meet. In order to
safeguard both customer and business interests, sensible constraints have been put in place.
Considering the psychological impact of marketing and ads according to John B. Watson's
behaviourism theory, it's clear that commercial giants' approach is to make people feel like
they belong in the ads and identify with them. Therefore, a responsibility-based neutralising
strategy must be associated with this occurrence. It is a corporate ethical obligation to ensure
that consumers are not led astray by claims about a product's misleading features. Both
consumers and businesses suffer when advertisements mislead them, which is a major
problem for the economy as a whole. More effort is put into safeguarding consumers than
into protecting competitors, even though the danger is the same for both groups. A common
concern is "how far" the law can differentiate between deceptive advertising and legitimate
methods of product improvement. In order for a market to function, there must be buyers and
sellers. Both should be fairly and equally protected by laws that deal with deceptive
advertising. regulation that is consistently slanted in favour of consumers would make it
nearly impossible for sellers to enter the market, while regulation that solely protects
corporate interests would render advertisements meaningless. Everyone knows that you can't
see through a product's facade. In light of this, you can always find a picture of veggies next

68
to a Maggi packet when you buy it in the market. The vendor is banking on the fact that the
consumer would "add" these items to their own taste buds. A deceptive advertisement could
be created by using a visual representation of something that does not actually exist,
according to a strict interpretation. The competitor's intention is that the end user will
manually add veggies to boost the snack's flavour and nutritional value, as he is unable to do
so due to a shrinking profit margin. It is a topping that is very recommended. To what extent
the depiction of Maggi with veggies on the exterior cover could be considered a misleading
advertisement in this particular circumstance is up for debate.

5.3. REDRESSAL MECHANISM

According to the Competition Act of 2002, deceptive advertising does not seem to violate
antitrust regulations at first glance. However, when we look at the two-pronged effect of
these ads, we see that they hurt both consumers and businesses that compete with them. Both
consumers and competitors are vulnerable to deceptive advertising; the former may be
swayed to purchase a product that isn't really better, while the latter risks losing customers
and credibility due to competitors' exaggerated promises. A rival is defined as: in Black's
Law Dictionary "A person trying to accomplish the same thing and each one offering to do it
better, provide the goods, or provide the service at a lower price than their competitive." Prior
knowledge of the Competition Act, 2002's background and purpose is necessary for
understanding its interaction with deceptive advertising and competition law. The 1969
Monopolies Restrictive Trade Practices (MRTP) Act served as the foundation for the 2002
Competition Act. The goal of passing the MRTP Act was to ensure that no single company or
market could ever control too much of a market. India was still a young sovereign nation
when the MRTP Act was passed; the government, guided by socialist ideals, was reluctant to
cede control of its resources to private companies. Back then, economists in India thought the
country's economy was still in its early stages and needed careful monitoring to make sure
that the poor didn't get rich off of it. In a complex demonstration of state power over its own
resources and the application of communist ideals inculcated in the Indian Bill of Rights. The
relevance of the MRTP Act, however, faded with the passage of time and economic priorities
shifting. Indian economic policy evolved over time, moving away from the Nehruvian model
and towards a liberalised economy that allowed for more private sector participation and less
government regulation. This led to the establishment of the Raghavan Committee, whose
mandate was to draft a bill to replace the MRTP Act, 1969. On January 13, 2003, the

69
Competition Act was passed based on the report of the committee. Section 3 of the
Competition Act forbids agreements pertaining to anti-competitive actions. Section 3
expressly forbids any agreements concerning: "the manufacturing, supplying, transporting,
warehousing, and controlling of products or services that have or are likely to have a
significant negative impact on competition in India" Any agreement that significantly reduces
or eliminates competition is considered anti-competitive. Examples of anticompetitive
agreements include: "an agreement to limit production and/or supply; an agreement to
allocate markets; an agreement to fix the price; a bid rigging or collusive bidding; a
conditional purchase/sale (tie-in arrangement); an exclusive supply/distribution arrangement;
a resale price maintenance; and a refusal to deal." Although this is by no means an all-
inclusive list, it should help shed light on the lawmakers' intentions. When people talk about
anti-competitive agreements, they usually mean contracts between businesses that are part of
the same supply chain, distribution network, or manufacturing process. Nobody mentioned
above could perhaps include an advertiser who agrees to promote a business's items. Since an
advertisement and a corporation are in the relationship of a service provider and client, the
publishing of the advertiser's misleading statements cannot be covered by this provision. In
addition, nothing in this section implies that companies can't use visual or print ads that make
unfounded claims. It is impossible to include deceptive advertising under this provision, even
if we take the widest conceivable interpretation of it. The idea of "abuse of dominance" refers
to when a corporation with a large portion of the market utilises its power to restrict
competition, charge higher prices to consumers, or otherwise take advantage of its position.
In essence, it encompasses anything that goes against the spirit of healthy competition. A
company can be considered dominant if it is in a strong enough position to either avoid or
significantly reduce the impact of competing forces on its operations. Misuse of a dominant
position can take many forms, such as predatory pricing, unfair conditions or pricing, limiting
production, market, or technological development, erecting barriers to entry, treating similar
transactions differently, denying access to markets, and leveraging a dominant position in one
market to gain an advantage in another. The phrase "abuse of dominance" needs no further
explanation. A dominant corporation is not the only one with a claim-making difficulty. We
observe these strategies in action on a daily basis as many new businesses seek to build their
reputation and capture a larger portion of the market. The idea that the largest fish in the pond
routinely engage in deceptive advertising is both irrational and lacking in context. This
obligation of the Commission is subject to the provisions of the Act, which does not address
misleading advertisements, but Section 18 requires the elimination of practices that harm

70
competition, promotion and maintenance of competition, protection of consumer interests,
and freedom of trade in Indian markets. The enterprise's dominating position and specific
agreements can be investigated by the Commission under Section 19. The criteria that the
Commission uses to decide whether the transaction has an appreciable detrimental effect are
laid out in the Act. Legislators might have included misleading advertising as a criterion, but
they didn't because it doesn't belong in that section. Here it is worth noting that misleading
advertisements were specifically included in Section 36 of the MRTP Act, 1969, which
defined Unfair Trade Practices. But as we've already established, there is no recourse for
deceptive advertising under the Competition Act of 2002. The differing legislative intentions
of the two statutes provide light on why the Competition Act, 2002 fails to address this
matter. While the Competition Act pursues remedies for competitors grievances on unfair
trade practices, the legislative objective of the MRTP Act shed light on the fact that the
provisions dealing with Unfair Trade Practices were mostly consumer-oriented. A new statute
was felt to be necessary because the MRTP Act was redundant. At the same time, in 1986,
lawmakers established the Consumer Protection Act with the goal of helping customers who
had complaints about businesses including stores, manufacturers, and distributors get their
money's worth. A new statute against unfair business practices was created when the Act
included provisions against fraud and deceitful conduct. Given the above, it was not
considered necessary to incorporate provisions addressing unfair trade practices while the
Competition Act was being enacted. Consumers and smaller businesses competing with
larger ones are generally well-served by the Competition Act. Despite the act's better
handling of their difficulties, there are still certain ambiguities, such as those stemming from
deceptive advertising and their effects on rival businesses. The contents of this Act shall have
force and effect notwithstanding anything to the contrary contained in any other law, and this
Act is not an entire list; rather, it acts in tandem with other laws. It is illegal to make false
statements regarding food products and to violate the FSS Act of 2006.
5.3.1. Food Safety and Standards Act of 2006 and the Advertising Standards Council of
India
According to Section 2 (zf), "misbranded foods" are food items that make false or misleading
promises. The FSS Act of 2006 establishes two requirements that must be met for deceptive
ads to be considered punishable: 1.Section 2 (b) of the FSS Act defines "advertisements" as
"any audio or visual publicity, representation or procurement made by means of any light,
sound, smoke, gas, print, electronic media, internet and website and included through any

71
notice, circular, label, wrapper, invoice to other documents;" This section describes the
criteria that such an advertisement must meet. 2.To be subject to the punitive sanctions under
Section 53, such an advertisement must be inaccurate, incomplete, or unclear. According to
Section 53, there is a penalty of up to Rs 10 lacs for anyone who publishes or is involved in
the publication of an ad that gives a deceptive description of food or is likely to mislead a
consumer about the type, amount, or composition of the food. It is commonly believed that
the idea of misleading advertisement is fully addressed due to the abundance of sections in
the FSS Act, 2006 that define, address, and define the many forms of such advertising. After
carefully reviewing all sections of the FSS Act, 2006, it becomes clear that the rival has no
recourse. The FSS Act, 2006 specifies in Section 23 that food packaging and labelling must
be suitable and not deceive consumers. It specifies both general and specific examples of
misleading advertising. Section 23 of the FSS Act, which addresses "Packaging and
Labelling of Foods," should be rigorously followed when marking and labelling such
consumer goods, primarily edible foods. Furthermore, the package must not contain any
assertions, claims, labels, etc. that provide inaccurate information regarding the product's
nutritional value or amount. There also shouldn't be any therapeutic or medicinal assertions.
The form, look, package materials, arrangement, and display are all within the purview of
Section 23, which also ensures that the product is not misleading. For all intents and
purposes, the FSS Act of 2006 was enacted to safeguard consumers from unscrupulous
business owners. The statute is essentially consumer-centric, despite the fact that the
provision gives specific guidance on what constitutes misleading ads. There is no
consideration for the complaints of the rival. In addition, Section 24 of the Act forbids unfair
trade practices, including deceptive advertising and false statements. The following are
examples of what is considered to be unlawful: a.Misleading consumers into believing that
the food is of a certain grade, quantity, or quality; b.Presenting the product's necessity or
value in an inaccurate or misleading light; c.Distributing to the general population any
assurance of effectiveness that has sufficient scientific basis; The general population is
unfairly affected by these actions, according to such laws. Although this is an imperfect
method, it is fair. The reason for this restriction is that the FSS Act, 2006 does not prohibit a
competitor from using defamatory or otherwise false advertising to disparage another rival's
product. Instead, general categories are established mainly to safeguard the general populace;
this makes it abundantly clear that the Food Safety and Standards Authority of India is an
agency whose sole purpose is to safeguard the general populace by preventing any form of
deceit or adulteration in food advertising, labelling, packaging, etc. This law is not based on

72
considerations of competition or current market circumstances. Here, the rival still has few
choices. Addressing consumer and industry concerns is the responsibility of the ASCI
Consumer concerns Council. But as a separate nonprofit organisation, its primary function
was to make suggestions. Thanks to its partnerships with GAMA and the Department of
Consumer Affairs, ASCI now has a direct channel to address consumer complaints, pursue
legal action, and keep up with changes to FSSAI advertising standards and market operations.
Due to the platform's treatment of consumers as an advantage, competitors lost faith in being
safeguarded from misleading advertisements when ASCI's independence was revoked.
"Advertising that works with a conscience, a salute to Indian Consumerism" is the motto of
ASCI, further highlighting the situation. Supporting this slogan is the code of the
Advertisement Standard Council of India, which establishes the parameters for acceptable
advertising while ensuring that the public interest is not compromised. Examining an
additional rule specified in the code will shed light on the complexities of the limited choices
offered by the competition.

5.4. THE INTERPLAY BETWEEN CONSUMER PROTECTION AND

COMPETITION IN THE CONTEXT OF UTPS AND RTPS IN INDIA

Interestingly, there is some overlap in the roles of RTPs and UTPs when it comes to the
implementation of the Consumer Act and the Competition Act in India.

5.4.1. Restrictive trade practices

Problems that may arise as a result of the two Acts’ overlap in substance and enforcement
are shown by the way RTPs are handled. Examples of RTPs that are outlawed under the
Consumer Act include “tie-in” sales and “delayed supplies,” both of which aim to artificially
inflate the price of goods and services by manipulating their delivery conditions or the
market’s supply and demand. Although the Raghavan Committee noted a small amount of
overlap between the two Acts concerning ‘tie-in’ sales, the Consumer Act’s definition of
RTPs is incredibly wide-ranging and would encompass any business practice that
manipulates prices or delivery conditions, or alters the market’s supply and demand for
goods and services in a way that unfairly burdens consumers with unnecessary costs or
restrictions. In 2002, there was yet another change to the Consumer Act, 86 "delay beyond the
period agreed to by a trader in supply of such goods or in providing the services which has
led or is likely to lead to rise in the price" was explicitly forbidden. The Raghavan
86
See Section 2(5) of the Consumer Protection (Amendment) Act, 2002.

73
Committee probably didn't look at the impact of this change as it was made a year after the
report was released and at the same time as the Competition Act was notified. Because of
this, the Competition and Consumer Act and the RTP regulation do share a great deal of
ground. However, in regards to the regulation of RTPs, how does this overlap manifest? The
presence of an agreement between merchants is a prerequisite for the Competition Act.
It applies a per se standard in relation to horizontal agreements87 and a rule of reason
standard for vertical agreements.88 This is somewhat similar to the enforcement history under
the MRTPA. In its initial years the MRTPA distinguished the RTPs within its scope to be
actionable only where they eliminated or restricted competition.89 By an amendment in the
year 1984, the Parliament included a per se standard for RTP contravention in the MRTPA.90
However, even after this amendment, some RTPs remained subject to a rule of reason
analysis.91

To the degree that RTPs constitute an abuse of dominant position, they are prohibited by the
Competition Act, which pertains to the regulation of dominant corporations. Regarding the
question of whether RTPs involving abuse of dominance necessitate a rule of reason or per
se analysis, the CCI’s enforcement history under the Competition Act provides no insight.
Within the NSE,92 Among other things, the CCI looked into whether the National Stock
Exchange’s decision to waive transaction fees in the currency derivatives segment violated
Section 4 32 of the Competition Act. According to the CCI’s interpretation of section 4(2) of
the Act, the word “unfair” must be considered in two contexts: one involving a customer and
another involving a competitor. The CCI noted that [NSE’s] argument that the
Commission’s order dated 25.05.2011 does not mention consumer harm, hence there must
be no element of abuse, should be rejected since this is not required to be proven under
section 4. Establishing that a company or group has a dominant position in the relevant
market is the first and foremost requirement of this section. The next step is to prove that it
has done one of the things listed in subsections (a) through (e) of the section. There is no
legal need to consider any further effects on rivals, customers, or the market once these two

87
Agreements between players engaged in an identical trade.
88
Agreements between players at different levels of the production chain.
89
Rajasthan Housing Board v. Parvati Devi (Smt.) and others; Appeal (civil) 14994 of 1996 judgment dated
03 May 2000.
90
Ibid.
91
M/s. Voltas Limited Bombay vs. Union of India AIR 1995 SC 1881.
92
MCX Stock Exchange Ltd. Vs. National Stock Exchange of India Ltd., DotEx International Ltd. and
Omnesys Technologies Pvt. Ltd., CCI Case No. 13 of 2009, Order dated 03 June 2011. 32Section 4 of the
Competition Act prohibits an abuse of dominant position.

74
are set up. Both of these questions have been thoroughly answered by the Commission in its
order. Unlike section 3, section 4 of the Act does not mandate the assessment of appreciable
adverse effect on competition (AAEC) or the assessment of the considerations listed in
section 19(3), which encompass the accumulation of consumer advantages. The decision in
NSE necessitates a re-evaluation of how RTPs are treated under the Consumer and
Competition Acts, especially since the CCI interpreted the Consumer Act as not requiring
proof of elimination or restriction of competition. It should be noted that the complainant
MCX was a competitor in NSE, not a consumer. Based on the CCI’s ruling in NSE, it seems
as neither statute uses a rigorous effects-based test. The Consumer Act makes it clear that
there must be actual harm to consumers in order to issue compensation and stop-and-desist
orders; however, contrary to what was said in NSE, the CCI’s decision-making practice
regarding Section 4 of the Competition Act does not seem to indicate an effects-based
standard for enforcement either. It would seem that RTPs are an effective means of
enforcing the Consumer Act and the Competition Act, even though proof of damage to
consumers or competition is not necessary. Although the Consumer Act was never meant to
address consumer harm, the CCI has a wide-ranging mandate under the Competition Act to
eliminate practices that harm competition, promote and sustain competition, protect
consumers’ interests, and ensure other participants’ freedom to trade in Indian markets. This
strongly suggests that Section 4 of the Competition Act should be interpreted according to
the rule of reason. Whether or if this reading is supported by the Competition Act is
addressed in section X below.
5.4.2. Interests of consumers
Another important difference between the two Acts is the treatment of the consumer. Under
the Competition Act, consumers include persons who buy goods or services irrespective of
whether they use it for a ‘commercial purpose’93, resale or for personal use. This is in line
with the preamble to the Act which requires the CCI to
...prevent practices having adverse effect on competition, to promote and sustain
competition in markets, to protect the interests of consumers and to ensure freedom
of trade carried on by other participants in markets, in India.94

93
Ibid.
94
Preamble to the Competition Act, 2002.

75
Unlike the MRTPA, there is also no requirement that the adjudication machinery under the
Competition Act should be triggered by a consumer. 95Under the Consumer Act, a consumer
is a person who purchases goods or services, but not for a commercial purpose. This
demonstrates that the purpose of the Consumer Act is to protect the interests of final
consumers and not other traders engaged in a different trade. This distinction is clear from
the grievance redress functions under both statutes and the addressability of their orders. The
Consumer Act addresses consumer disputes against traders directly, while the Competition
Act addresses consumer welfare indirectly by ensuring that efficiencies are promoted and
more choices are available to consumers. In practice we see that this distinction is often very
blurred. A significant example of direct regulation in favour of the consumer is the DLF
case.96 It involved a complaint by an association of apartment owners assailing certain terms
and conditions in DLF’s standard form Apartment Buyer’s Agreement and alleging abuse of
dominance by DLF. These terms included DLF’s discretion to change the layout and nature
of use of the apartment complex without the consent of apartment allottees, its right to
change the super area of the complex without consulting allottees and other clauses
including additional payments. Additionally, the complaint charged DLF with imposing
unfair terms in its conduct against apartment allottees. In a final order penalizing DLF with a
penalty of 6.3 billion rupees, the CCI directed DLF to cease and desist from ‘formulating’
and ‘imposing’ ‘unfair’ terms in its agreements with buyers in Gurgaon. The CCI also
directed DLF to modify its agreements with buyers. The order characterised the abuse
practiced by DLF as ‘unfair’ and ‘even exploitative.’
The fascinating blurring of boundaries between consumer processes and competition is
illustrated by the DLF case. Gurgaon is a small satellite town in Delhi’s National Capital
Region, and the CCI found that DLF’s real estate operations inflated prices and skewed
competition in the area. According to the CCI, these kinds of policies make it harder to
switch between different kinds of services. As a result, it appeared that other real estate
players were unfairly competing with DLF for customers who had exercised their option to
buy an apartment from them due to the high switching costs associated with moving to a
different developer and the lack of information that customers had regarding the worth and
expense of their investment. In such cases, the buyer might have chosen to go elsewhere for

95
‘Information’ can be filed by any person under Section 26(1) of the Competition Act. However, the
Competition Appellate Tribunal has stressed on the need to evaluate the locus standi of informants; L.H.
Hiranandani Hospital Vs. Competition Commission of India and Ors. Order of the Competition Appellate
Tribunal in Appeal No. 19 of 2014 dated 18 December 2015.
96
Belaire Owner’s Association vs. DLF Limited, CCI Order dated 12 August 2011 in Case No. 19 of 2010.

76
real estate services, but instead they are stuck with DLF after paying a significant amount
with no way out, all because they were unaware of the extensive terms and conditions
imposed by the Agreement, according to the CCI. Both consumer choice and market
mobility are hampered by the high switching cost. Both market competition and consumer
welfare are being distorted by the information asymmetry caused by this lock-in, as parties
involved are unaware of the Agreement’s terms and circumstances. The question of whether
these actions led to more competition in the real estate market in terms of price, quality, and
choice remains open, even though the CCI may have identified a theory of injury in the
competition space. In its analysis of how DLF’s actions have affected other real estate
players, the CCI finds that, in the real estate market in particular, competitors are likely to
adopt DLF’s terms and conditions, which would hurt consumers’ well-being. “The order of
CCI as well as this judgement is expected to go a long way to ameliorate all the conditions
of the customers,” the Competition Appellate Tribunal said while upholding the CCI’s
decision in appeal. Only one real estate case—DLF—has so far survived two rounds of
antitrust review. It appears that the consumer remedies granted in DLF would not be useful
for consumers dealing with smaller real estate developers, based on the spate of cases
presented before the CCI about real estate activities after the CCI ruling. The suggestions
made by the CCI to the Indian government in the DLF case on the real estate industry’s
“unfair trade practices” are an example of the regulator’s commendable effort to strike a
balance in a groundbreaking case involving direct consumer suffering. With the goal of
regulating and promoting the real estate sector, protecting consumer interests, and
establishing an adjudicating framework for rapid resolution of disputes, the Real Estate
(Regulation and Development) Act, 2016 was subsequently notified by the Parliament. The
CCI’s decision to relinquish this jurisdiction and the extent to which this Act will reduce
competition scrutiny in the real estate industry are both open questions.
5.4.3. Regulation of unfair trade practices
Another noteworthy change is that the Competition Act no longer applies to UTPs. Given
that these “practices were likely to cause grave loss or damage to many consumers,” the
Sachar Committee initially suggested keeping UTPs in the MRTPA. Having said that, the
Competition Act does not include any mention of UTPs in the manner that they are
understood under the MRTPA. The word “unfair” does appear in the Competition Act, but
only in relation to Section 4’s discussion of dominant entities’ restrictive trade practices. A
“dominant entity” is defined under the competitive Act as an organisation that (i) has the

77
power to influence its competitors, customers, or the relevant market to its advantage and (ii)
is able to act autonomously from competitive forces. It is illegal to impose an unfair price or
condition on the purchase or sale of goods or services under Section 4 of the Competition
Act. The Consumer Act regulates UTPs based on their “effects” rather than their “form,” and
the word “unfair” is not defined there either. As an example, the National Consumer
Disputes Redressal Forum ruled in the Unitech cases that unfair practices that do not fall
directly under Section 2(r) of the Consumer Act but yet constitute UTPs since they involve
the use of unfair methods and tactics towards the consumer. The CCI’s enforcement practice
does not indicate a ‘effects above form’ approach, as we have already shown in the NSE
case. On the other hand, the Competition Appellate Tribunal had to decide on this “unfair”
definition in a separate instance. In Schott Glass,97 the Competition Appellate Tribunal
considered whether the application of unfair and discriminatory terms of price and
conditions of supply contravened Section 4(2)(a) of the Act. The Appellate Tribunal held
that in the absence of any effect on the market or effect on consumers, the imposition of
terms by a dominant entity could not be held to be unfair. The interpretation of the term
“unfair” under the Competition Act therefore necessarily diverges from the inclusive ‘effects
over form’ treatment of UTP’s under the Consumer Act. The CCI’s decisional practice has
distinguished several UTP cases in the past. In Sanjeev Pandey v Mahendra & Mahendra &
Ors, 45 the complainant alleged that a certain model of vehicle was introduced by the
opposite parties in certain states, denying the benefit of increased sales to distributors. The
CCI closed the inquiry noting that the Consumer Act sets a more appropriate course to assail
UTPs. Similarly, Subhash Yadav v. Force Motor Ltd and Ors98 pertaining to a customer's
complaint stemming from the sale of a vehicle by the other side. When the air conditioner
was turned on, the informant claimed, the engine began to overheat. The source indicated
that the other side had installed a Daimler engine—typically seen in Mercedes SUVs—into
the vehicle in question, which is owned by a wealthy individual and costs over one million
rupees. It was further claimed that the opposing side established dominance by penetrating
the Indian market with a vehicle priced much lower than competing brands. The CCI
decided not to step in and said that the main distinction between the Consumer and
Competition Acts is that the former gives consumers a way to directly resolve their
complaints, while the latter makes sure that markets stay competitive, which means that

97
Schott Glass India Private Limited vs. Competition Commission of India, COMPAT Appeal Nos. 91 and
92 of 2012, Order dated 02 April 2014. 45Case No 17 of 2012.
98
Case No. 32 of 2012.

78
consumers benefit indirectly. The CCI was actually confronted with fundamental consumer
issues in these cases.

5.5. THE NEED FOR CORRECT SEPARATION OF UTPS AND RTPS

In Official Airline Guides (OAG), 99 In front of a U.S. Court of Appeals, the FTC contested a
monopolist's and schedule publisher's decision to omit commuter airlines' schedules from its
compilation. Commuter airlines were hurt in their rivalry with certificated flights due to this
unreasonable and discriminatory reluctance to deal. While the antitrust injury happened in
the commuter airlines' market, the monopolist did not use coercion, competed in that market,
or even try to obtain power there. The court did not support the Commission's order, even
though it stated that FTC rulings about what constitutes a "unfair method of competition"
should be highly considered. While explaining its decision, the court voiced its apprehension
that the Commission would be granted too much power to replace the respondent's
autonomous business decisions, which were made without any intention or possibility of
anticompetitiveness, with its own judgement. There was no violation of antitrust laws'
fundamental policies, even if the alleged conduct was discriminatory and hurtful. Similarly,
in Boise Cascade,100 a U.SThe 9th Circuit Court of Appeals was thinking of instituting a
delivery pricing structure for the whole business. The lawsuit involved adding a fictitious
goods component to the final price that consumers paid. Such actions, according to the FTC,
tend to stabilise prices, which is a violation of both the Sherman and FTC Acts. This
argument was rejected by the court, which ruled that delivered pricing is a form of price
parallelism that caters to consumer preferences. There was insufficient evidence of an
anticompetitive effect in this instance, hence the court ruled that it was non-sequitur to
consider whether intentionally comparable conduct might ever violate Section 5 of the FTC
Act. "The Commission must find either collusion or actual effect on competition to make out
a Section 5 violation for use of delivered pricing," the Court said, drawing on this precedent
to establish the rule. To combat unfair tactics of competition, the FTC most recently
published a Statement of Enforcement Principles in 2015 outlining the Agency's use of'stand
alone' Section 5 jurisdiction. Even for a fully developed jurisdiction like the FTC, the
relationship between UTPs and anticompetitive conduct is complex, as is shown by the fact
that this statement was issued more than a century after the FTC gained the authority to
enforce Section 5. The Federal Trade Commission (FTC) stated in its statement that when
99
Official Airline Guides, 630 F.3d at 927
100
Boise Cascade, 637 F.2d at 581.

79
determining whether to challenge a practice as an unfair method of competition in violation
of Section 5 on its own, it will follow the public policy underlying antitrust laws, which is
the promotion of consumer welfare. The practice will then be evaluated using a framework
similar to the rule of reason, which states that an act or practice challenged by the
Commission must cause harm to competition or the competitive process, The dissenting
opinion of Commissioner Ohlhausen states that this policy statement gives the FTC too
much leeway to apply Section 5 even when there isn't a major harm to competition, even
though the statement does a good job of explaining that the investigation into whether there
is harm to competition is what drives the exercise of the powers to control unfair methods of
competition.52The relationship between anticompetitive behaviours and unfair trade
practices is still complex in the European Union, in contrast to what has happened in the
United States. The problem is especially complex in the European Union (EU) because of
the vague language in Article 102 TFEU about unfair trading conditions, which can apply to
a wide variety of unfair practices—including those that might be considered "unfair
commercial practices" under current consumer protection laws. So, it's possible that unfair
activities (such those that could hurt a competitor's interests) could be outlawed under
Article 102 TFEU in the EU even when they don't really hurt competition. Along with this,
the question of whether detrimental consequences of competition are necessary for the
Article 102 TFEU prohibition to be applied and, moreover, what kind of impacts would be
sufficient in this investigation, is debatable in EU competition law. Obviously, real impacts
on competition are unnecessary; expected effects will do. Nevertheless, even in this quest for
effects, it is arguable whether, say, impacts on the rival of a dominant undertaking would be
enough, or whether effects on customer welfare are essential. This is especially problematic
when it comes to so-called exploitative activities, which primarily manifest as detrimental
impacts demonstrated on the clients, including end consumers, of the dominating
undertaking, but do not necessarily warrant an immediate distortion of competition.
According to Akman's previous arguments, while it is undeniable that Article 102 TFEU
forbids exploitative behaviour, for the rule to be effectively enforced as a competition rule—
its intended purpose—it must be accompanied by exclusionary conduct that harms
competition in order to be deemed abusive. Up until now, this has not materialised in EU
decision-making. While the Commission has mostly targeted exclusionary abuses in its
implementation of Article 102 TFEU, there have been a handful of cases where exploitation
was a concern. However, it is unclear whether these instances necessarily involved
exclusion, which makes one wonder if the action was warranted. For instance, it was not

80
immediately apparent how the 'unfair' and perhaps 'exploitative' price-based and other
practices of a dominating undertaking harmed competition in the cases of British Leyland,
the 1998 Football World Cup, and BdKEP. Similarly, it is not apparent why contractual
provisions were considered a matter of competition law in instances like SABAM, GEMA,
DSD, and Tetra Pak II, where 'unfair trading conditions' were determined to be abusive.57 In
other instances, the court has ruled that the dominant undertaking's inefficiency had abusive
repercussions, such as taking advantage of the trading partners of the undertaking without
necessarily distorting competition. Some of these behaviours seem more like issues with
consumer protection or contracts than with competition law without this distinct
demonstration of damage to competition, such as exclusion. Therefore, rather than utilising
competition law to address such acts, it would be more appropriate to do so through contract
law or consumer protection law.
In India, the CCI has also had to grapple with this issue in its decisional practice. In
Shivang Agarwal & Ors. vs. Supertech Ltd. Noida,101 the CCI recognized that UTPs are

“adopted by many enterprises whether dominant or not. Every unfair trade practices
or abuse done by an enterprise is not covered under Competition Act. Several
aspects of the unfairness on part of service provider/goods provider are covered by
the Consumer Protection Act. The two aspects covered by the Consumer Protection
Act are unfair trade practice as well as charging of price in excess of the price agreed
upon between the parties.”

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In Mr. Gajinder Singh Kohli vs. Genius Propbuild Private Limited, The CCI deliberated
over the possibility that an abuse of dominating position had occurred due to the apartment's
delayed delivery of possession. Opposing the CCI's authority to investigate UTPs was the
other party. On the other hand, the CCI looked at the case independently, noting that since
the problem was abuse of dominance, it would investigate to see if it violated the sections of
the Act pertaining to such conduct. According to what was said, the CCI bases its
enforcement actions on the assumption that there is unilateral activity as described in Section
4 of the Act. There is no longer any requirement for form-based approaches to business and
competition in the Indian market, thanks to the pervasiveness of digital media and e-
commerce. This means the CCI will have to think about how to police things based on their

101
Case No. 28 of 2012.
102
Case No. 15 of 2016.

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impact if certain activities don't fit the strict definition of unilateral conduct in Section 4. For
obvious reasons, this could necessitate changes to the current law, as UTPs are still not
covered by the Competition Act, in contrast to, say, Article 102 TFEU, which addresses
unfair pricing and unfair trade circumstances. An effects-based approach is desirable, as
other regulators' experiences with UTPs that limit or distort competition have shown. As an
illustration, a "fair trade hindering" criterion for UTPs is prescribed in the Guidelines for
Review of Unfair Trade Practices by the Korean Fair Trade Commission. If the connected
act significantly reduces the number of competing businesses (including potential
competitive enterprises) or the degree of market competition, then it is considered Fair Trade
Hindering under these rules. In a similar vein, they define "unfairness" as an impartial
standard for identifying deceptive business practices. A case of unfair competitive means
would be one in which, in addition to price and quality, other unlawful competitive methods
are used to impede or threaten to impede fair competition. When a business relation creates
an unfair advantage for one party or impedes another party's ability to make an informed
decision about the relationship, it is considered unfair trade. Another relevant topic is
whether consumer forums should investigate specific cases of anti-competitive
policymaking. Regulators need to be flexible enough to adapt to changing business practices
and times, even though some claim that they only consider limited RTP and UTP issues that
are relevant to customers. We need to think about whether consumer forums with CCI-like
authority could have done a better job of regulating the real estate industry and establishing
standards of conduct, as the CCI suggested in DLF. It is possible that this sidestepped the
real estate cases that followed DLF, which involved controversial issues of market power
and competition and foreclosure. On the other hand, the Federal Trade Commission's (FTC)
experiences with Section 5 of the United States Federal Trade Commission Act, which
forbids "unfair methods of competition in commerce, and unfair or deceptive acts or
practices in commerce," provide valuable insight into why consumer and competition policy
and practice should converge. The FTC Act was amended in 1938 to make it crystal
apparent that a consumer who may be harmed by an unfair commercial practice is just as
concerned to the law as a merchant or manufacturer who may be harmed by the unfair tactics
of an unscrupulous competitor. In the case of FTC v. Sperry & Hutchinson Co., the Supreme
Court of the United States upheld this extensive requirement, saying: While the challenged
practices may not constitute a threat to competition in the strict sense of the antitrust laws,
Congress has granted the FTC the authority to investigate and decide whether the practices
in question constitute unfair methods of competition or unfair or deceptive acts or practices,

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with the goal of protecting both consumers and competitors. In 1938, Congress reaffirmed
this wide-ranging obligation with the Wheeler-Lea Act.

5.6. CONCLUSION

Despite the significant differences in jurisdiction and mandate between consumer forums and
the CCI under Indian law, there were 3.7 million consumer cases that were still pending in
consumer forums as of 2014. It would be wise to incorporate consumer-friendly market
regulation into the current system, either by creating a code of best practices or by allowing
consumer forums to regulate themselves. The Consumer Protection (Amendment) Bill, 2015
has already begun to take shape, with provisions to create a Central Consumer Protection
Authority (CCPA) to safeguard, advocate for, and implement consumer rights. Among the
many things that the CCPA will do are the following: (i) looking into complaints of consumer
rights violations, conducting investigations, and filing lawsuits when necessary; (ii) ordering
the return of products or services and payment of any fees owed, as well as the end of unfair
trade practices; (iii) sending out safety warnings and directing the removal of ads; and (iv)
nullifying unfair contracts. Recognising the distinct roles, processes, and, to some extent,
aims of competition law and consumer protection law should be the first step in formulating
policy, even if both aim to improve and safeguard consumers’ interests. In distinct ways, the
two branches of law safeguard consumers’ rights. When compared to the broader aims of
consumer protection law, the competition law objectives are far more limited. Policies should
be based on what is best for society, and competition legislation should be enforced to
prevent actions that harm consumers or the overall welfare by distorting competition.69 It is
possible that competition authorities will have to take on the role of regulators for activities
for which they are not best suited, such as those that are only exploitative of a dominant
undertaking’s customers through unfair practices and similar tactics, rather than exclusionary
through distorting effects on competition.70 By excluding UTPs from the Competition Act,
the Indian lawmaker has shown its preference for consumer protection law and competition
law to be separated in relation to UTPs. Neither the United States nor the European Union
have accomplished such separation in their competition laws, therefore this shows a more
contemporary approach.

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 CHAPTER 6

CONCLUSION AND SUGGESTIONS

This Act guarantees that no advertisement of goods or services is made that is false or
misleading, or that any of the Act's provisions, rules, or regulations are broken. It also forbids
unfair trading practices. Additionally, it ensures that no one takes part in unfair business
activities or publishes deceptive or inaccurate advertisements. The Consumer Protection
Authority now has the power to investigate unfair business practices and deceptive
advertising thanks to this Act. There's a new chapter added called "Product Liability". Along
with these big changes, a few smaller tweaks are also made to increase this Act's efficacy
over its prior iteration and facilitate the prompt and reasonably priced handling of client
complaints. Ads are controlled by self-regulatory systems as well. Advertising self-regulation
is the advertising industry's strict adherence to rules created by and for all advertising
stakeholders. The current study shows that there are two kinds of advertising codes in India:
(i) codes created by the government or another statutory body, and (ii) self-regulation
regulations for advertising established by media outlets, advertisers, and agencies. The first
category includes codes such as the Fair Business Practices Code, the Advertising Standard
Council of India's Code of Advertising Practice, the Norms of Ethics of the Federation of
Indian Chambers of Commerce and Industry, the Consumer Code of the Association of
Indian Engineering Industry, and others. In terms of binding force and legal consequences,
the voluntary codes are not the same as the government codes. The Press Council of India's
Norms of Journalistic Conduct, the All India Radio Code for Commercial Broadcasting, the
Code for Commercial Advertising on Doordarshan, and the Advertising Code mandated by
the Cable Television Network (Regulation) Act, 1995 are among the government rules. While

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self-regulation has numerous benefits, there are drawbacks and limitations as well. First and
foremost, the foundation of operation is voluntary compliance. It breaks down when a small
number of businesses in the industry decide it's better to deviate from industry standards; as a
result, the enforcement of voluntary standards is hindered; customers don't trust business self-
regulation; media codes seem traditional and conventional; there is no independent body to
monitor their implementation; and finally, there is no legal backing for these codes. The
government, media, trade associations, businesses, and advertising agencies should all
carefully consider how to resolve the challenges brought up in this chapter. A casual review
of the previous discussion leads one to the conclusion that misleading and deceptive
advertising posed a serious risk to society and consumers in general. But we need to take the
following measures to control and stop this inappropriate behaviour:
1) Before making a purchase, ask us the following questions: why, when, where, how much,
how often, how long, etc.
2) Consumer-focused advertising should be conducted honestly and morally.
3) No one should deceive the customer.
4) State what is required to put an end to misleading advertising in a genuine and truthful
manner.
5) Uphold morality and common courtesy.
6) To determine a product's potential for promotion, a thorough analysis of the main demand,
purchase motivations, hidden qualities, multiple benefits, and financial considerations in each
marketing situation is required.
7) To maintain fair competition while taking into account the demands of customers, and to
abstain from advocating products that endanger the public or individuals, particularly minors.
Within the marketing mix, advertising is essential to the development of a communication
plan. Latent needs arise when the body is stimulated externally. Consumers have "internal
tensions" as a result, and entertainment companies in a country like India can easily exploit
this type of advertising to promote corruption if it is not sufficiently screened. If inaccurate
advertising is not sufficiently regulated and managed, it has the potential to undermine and
mislead our freedom of choice and purchasing behaviour. Still, action needs to be taken to
raise public and NGO awareness among frequent users. The execution of current consumer
rules should not be disregarded or treated with insensitivity by law enforcement agencies.
Patients, teens, and children in particular need to be shielded from the negative effects of
misleading and deceptive advertising.

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This leads one to the conclusion that deceptive and truthful advertising are two sides of the
same coin in this age of globalisation. Even while there is a clause requiring the publication
of corrective advertisements, it is insufficient because advertisements also need to abide by
the self-regulation code, ethics, and morality. Advertisements are beneficial because they
give consumers the information they need to make an informed decision. In addition to
teaching and pleasure, they offer information. They guarantee the best possible use of human
and physical resources by promoting output, revenue, and employment. Higher income levels
contribute to higher living standards. While consumers benefit from creative items and
advertising helps new products get quickly adopted, lower expenses across the board allow
for a commensurate drop in prices. Additionally, buyers benefit from informative advertising
by quickly obtaining sufficient and pertinent information about all rival brands and their
advantages. A country’s culture is changed via advertising. Advertising also has an impact on
consumers’ attitudes, tastes, preferences, habits, likes, dislikes, and fashion sense. In
actuality, the modern world revolves around advertisements.
The primary complaint of advertising is that it manipulates the consumer into buying things
they do not want to buy by making false or deceptive claims or by instilling needs, wants, and
desires in their minds that they might not have otherwise had. Even if it’s not always
warranted, certain service providers, dealers, and manufacturers have engaged in unethical
behaviour, which has led to condemnation. A bad perception of advertising has been
cultivated by the promotion of dangerous items, the overexposure of the female form in some
ads, the overemphasis on sex appeals, the use of overstated claims, and the excessive
repeating of claims. Additionally, advertising is charged with encouraging materialism by
encouraging individuals to place an excessive amount of value on material possessions.
It is said that advertising fuels the spiritual unhappiness that drives people to work towards
bettering their financial situation. It exploits human frailties, aspirations, fear, optimism, and
insecurity. Given the previous reasoning, it is obvious that advertising needs to be regulated.
In India, the United States, and Britain, advertising is regulated by different combinations of
laws and self-regulation. All democratic countries acknowledge the need for regulation of
unfair advertising, which is defined as that which deceives the public or other traders by
taking advantage of their vulnerabilities and that which violates public policy or is
immoral,unethical, or dishonest. Prohibition of ads for products that pose a risk to one’s
health is also necessary. Although there are several regulations in India to prevent deceptive
and false advertising and safeguard consumer interests, as was previously covered in the
preceding chapters, consumers are still the targets of deceptive advertising for two reasons:

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 a) The improper enforcement of the law and
b) Weaknesses or gaps in the current legal system.

A deceptive commercial is still challenging and contentious. Advocacy groups for consumers
and advertisers, understandably, seldom agree on whether a given advertisement is deceptive.
The manufacturer’s identification of deceptive advertising is based only on the measured
beliefs of the target audience. If a comparison group has fewer incorrect beliefs than an
exposed group, then advertising is deceptive. After eight purportedly deceptive ads were
investigated, four were found to be exploitatively misleading and two to be misleading.
Therefore, deceptive advertising has a negative impact on consumer welfare and needs to be
controlled by the institutional structure and regulatory guidelines that govern deceptive
advertising in our nation. When making a purchase of goods or services, the consumer should
be logical in their reasoning and the way that words are packaged. Maggie is a prime example
of how the words of well-known actors could not conceal the flaws in the product, which
required them to examine and revise the material.
In India, the decision to dissolve the Monopolies and Restrictive Trade Practices (MRTP)
Commission was the right one because it allowed the Competition Commission of India to be
established. However, this decision also left a significant gap in consumer protection,
particularly when it came to deceptive and false advertising. In particular, while consumer
courts have the authority to address unfair trade practices, the government has chosen to
exempt unfair business practices from the Competition Commission’s jurisdiction.
The Consumer Protection Act of 1986 and the Monopoly and Restrictive commercial
Practices Act of 1969 both identify false or misleading advertising as unfair commercial
practices. An irate customer could seek redress under the Indian Contract Act of 1872 and the
tort law prior to the addition of a chapter on unfair trade practices, which started with
Sections 36 A to 36E of the MRTP Act. However, as this study makes abundantly evident,
these laws’ legal protection against these kinds of marketing was insufficient. Armed with the
MRTP Act’s new regulations prohibiting unfair commercial practices, the MRTP
Commission has been instrumental in deterring these kinds of ads.
The MRTP Act, 1969 originally defined unfair trade practice as a list of types of unfair trade
practices. However, an amendment in 1991 changed the definition to a broad concept, with
the specified practices becoming a category of illustrations. This means that, regardless of
whether it fits into one of the lists of categories or not, using an unfair technique or deceptive
conduct to promote a sale will be considered an unfair commercial practice for the purposes

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of this Act. However, the study shows that the MRTP Commission, which was established in
accordance with this Act, has stuck to the list of unfair trade practice categories provided in
Sections 36A of the Act, failing to take use of this chance to identify new types of unfair
trade practices. There are other instances in which the Commission has limited the definition
of unfair trade practices. Firstly, the Commission has interpreted the terms “false” and
“misleading” together, thereby narrowing the scope of the provisions pertaining to unfair
trade practices. Secondly, the Commission has relied on the requirement of loss or injury
when deciding complaints regarding unfair trade practices, even though Parliament had
already removed this requirement from the definition.
The current analysis demonstrates that the MRTP Commission’s efforts to discourage
deceptive or false advertisements have not been as successful as intended. This could be
explained by a number of factors. First and foremost, the Commission lacked the guts and
creativity to offer remedies allowed by the MRTP Act’s statutory provisions; second, the
Commission had numerous issues enforcing its orders; third, there was a dearth of personnel
and other necessary infrastructure; and, last, the Commission was subject to specific statutory
restrictions.
The MRTP Commission lacked the authority to grant relief such as "Affirmative Disclosure,"
”Corrective Advertising,” “Competitor Law Suit,” “Fencing In,” “Advertising
Substantiation,” and “Counter Advertising,” but it was able to grant relief in the form of
“temporary injunction,” “Cease and desist order,” award, or compensation. Even “Cease and
desist” orders, which were issued after the harm had already been done, were ineffective in
stopping the practice of deceptive or false advertising since they may shield consumers from
future harm. Furthermore, the negative effects of the Commission’s “Cease and desist orders”
could be mitigated by business owners, advertisers, and advertising agencies by making
minor adjustments to the previous advertisement. The lack of an appropriate system to track
the fulfilment of promises made by any company to refrain from unfair trade practices in the
future further exacerbated the issue. Regarding orders under Section 12(b) of the MRTP Act,
the Commission had, in a very small number of cases, provided consumers who had been
wronged with reasonable compensation.
As we’ve already seen, not only was the process for carrying out the Commission’s orders
drawn out and difficult, but the investigation process itself was far from ideal. Therefore, it
was not required to forward each and every complaint to the Director General for an initial
inquiry. In actuality, a lot of the issues might be settled with the use of documentation. In
addition to providing remedy to many victims of deceptive or false advertising as well as

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other unfair and restrictive trade practices, the Commission has established a sizable body of
law regarding unfair trade practices in spite of procedural obstacles and practical challenges.
Some salient points of the jurisprudence that the Commission has developed are as follows: it
has held that the producer’s subjective judgement regarding the quality, standard, etc. of the
products is relevant, and the only thing that the law requires of him is that the facts that form
the basis of his subjective judgement be true and not deceptive. The Commission believes
that anti-competition and anti-consumer elements, not the “loss or injury” to consumers, are
what unfairly characterise advertisements. The Commission further declared that the
advertiser, not the Commission, should make decisions regarding the advertisement. The
Commission’s determinations regarding sponsorship, approval, fake necessity, warranty or
guarantee, and other matters demonstrate the makers’ and sellers’ resourcefulness in
deceiving the average consumer through visually appealing yet dishonest or misleading
advertising. Additionally, the Commission declared that it was illegal to engage in lotteries,
games of chance, or skill-based contests. These kinds of activities are considered unfair trade
practices because they lead potential customers to believe that they are receiving a great deal
on the product in question.
The MRTP Act, 1969 has been abolished and the Commission which was constituted under
the Act has been dissolved with the implementation of the Competition Act, 2002.
Consequently, the sole law that now controls and regulates unfair trade practices, including
deceptive and fraudulent advertising, is the Consumer Protection Act of 1986. There is a
significant overlap in the definition of unfair trade practice between the MRTP Act and the
Consumer Protection Act, which is literally the same in both enactments. As a result, there
was a total overlap in the jurisdiction of the MRTP Commission and Consumer For a
established under the CP Act with regard to controlling false or misleading advertisements
and other unfair trade practices. The study clearly reveals this overlap along with several
distinctive features regarding the consti Section 3 of the CP Act, which states that the
provisions of the Act are in addition to and not in derogation of the requirements of any other
legislation already in force, further supplements this. This implies that a victim of unfair trade
practices may file a complaint with the MRTP Commission or the Consumer For a created by
the P Act. But when the MRTP Act of 1969 was repealed, this system came to an end.
In contrast to the single MRTP Commission in New Delhi, the CP Act establishes a three-tier
redressal system that includes the District. The forum will be located near the customers’
residence at the District Headquarters. Nowadays, it is less expensive and more practical for
the individual customer to knock on the doors of the State Commission or the District Forum.

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Compared to the MRTP Commission, the Consumer Dispute Redressal Agencies have a
greater range of authority when it comes to providing remedy against deceptive or false
advertisements and other unfair commercial practices, including the ability to enforce
“Corrective Advertisement.” In the case that the other party’s negligence results in “loss or
damage,” they are permitted to reimburse the customer. It’s interesting to note, nevertheless,
that these Agencies have paid out compensation in cases of unfair commercial practices
without letting this condition stand in their way. This demonstrates these Agencies’ liberal,
progressive, humanistic, and customer-friendly philosophies. Furthermore, compared to the
MRTP Act, the enforcement process envisioned by the CP Act is more realistic and
consumer-friendly. They have the authority to attach the defaulter’s property in order to
enforce their interim order, and they can also act as a First Class Judicial Magistrate when it
comes to trying cases involving Act violations.
India is a welfare state, as is widely recognised, one that provides social services to its
citizens and works to further their overall well-being. Therefore, the State has a constitutional
obligation to safeguard and promote the welfare of consumers. The Directive Principles of
State Policy and the Preamble to the Fundamental Rights support this opinion even more. As
the Indian Constitution requires the State to ensure for its residents, social and economic
justice include consumer justice as a fundamental element. The notions of “consumer
protection” and “consumer justice” entail encouraging ethical commercial advertising and
prohibiting offensive, pornographic, indecent, or dishonest and fraudulent advertising. A
variety of laws have been passed periodically in order to carry out the Constitution’s
obligation to safeguard the public and consumers from the perils of contemporary
advertising. The Indian Constitution makes no mention of the section protecting consumers.
It's interesting to note that passing legislation aiming to control advertising in this nation has
never been hampered by consumer affairs' exclusion from any of the Union List, State List,
or Concurrent List.
Advertising is protected by the “freedom of speech and expression” section of Article 19 of
the Constitution because it is not only a speech but an effective speech as well. The Supreme
Court rejected the protection of free expression for a commercial advertisement in the case of
Hamdard Dawakhana, citing the commercial’s aspect of trade and commerce and its failure to
develop any idea—social, political, or economic—or advance literature or human thought.
However, the same court later changed its mind and included commercial advertisements to
the list of items covered by Article 19(1)(a). Advertising is a sort of commercial
communication that serves two purposes: first, it informs the public about the goods being

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marketed, which benefits the public in general; and second, the public has a right to receive
the commercial information. Since a democratic economy depends on the free flow of
information, manufacturers’ and producers’ rights to promote their goods are now
acknowledged as fundamental freedoms implied by Article 19(l)(a) of the Constitution. The
extension of Article 19(l)(a) protection to commercial advertising is justified because the
right to commercial information is an essential component of the right to information, which
is once more a fundamental right recognised by the courts and a prerequisite to the exercise
of other fundamental rights of consumers. In a democracy such as India, advertising is the
lifeblood of the press, just as it is the lifeblood of commerce. Therefore, any restriction on
advertising would violate Article 19(l)(a)’s guarantee of the fundamental right because it
would decrease revenue and force newspapers to raise their prices, which would inevitably
have an impact on readership. The right to print and distribute the publication is a
fundamental component of the freedom of speech and expression, so this will have an
immediate impact on that right.
In a democracy, it is vital to protect and uphold the right to free expression, but it is also vital
to impose limitations on that right in order to preserve social order. This freedom, like other
freedoms, is not absolute or unrestricted, and the state may pass legislation imposing
reasonable limitations on the exercise of the right to issue commercial advertisements in the
interests of public order, decency, morality, sovereignty, and integrity of India, as well as in
relation to defamation, contempt of court, and incitement to commit an offence. Because of
this, it is impossible to see the laws’ requirements on the dissemination of information as
restricting people’s right to free speech. Article 19 (1) (a) exclusively applies to citizens, as
we learned in Chapter IV; a non-citizen who owns a newspaper is not eligible to ask for the
assurance of this constitutional protection. However, the study shows that a firm can still use
its shareholders to exercise its right to freedom of commercial advertisements even though it
is not a citizen.
Legislation is only as effective as how it is put into practice, and the CP Act is no different.
Even though the Consumer Forum has helped many consumers and their success rate is
generally satisfactory, there is still room for improvement, especially in three areas: (i)
changing the law to address several gaps in its application; (ii) ensuring that the State
Governments provide the necessary infrastructure to ensure that the District Forum and State
Commission run smoothly; and (iii) changing the attitudes of both the consumer forum
members and the attorneys who appear in these forums.

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The Consumer Protection Act of 1986 has been superseded by the Consumer Protection Act
of 2019. Many amendments to the Act have been incorporated into the new legislation in
response to the evolving landscape of consumer transactions, most notably the rise of e-
commerce. Three new unfair trade practice categories have been added to the new Act, 2019:
the first is failure to issue a bill, cash memo or receipt; the second is refusal to accept the
goods back or withdraw the services; the third is disclosure of any personal information
provided by the customer in confidence. Chapter —III of the Consumer Protection Act of
2019 was added to the Act to establish a Consumer Protection Authority. This authority will
carry out a number of duties under the Act, such as preventing unfair trade practices and
making sure that no advertisement for goods or services is made that is false, misleading, or
in violation of the Act’s provisions or the rules and regulations made thereunder.
Additionally, the Authority will make sure that no one participates in unfair trade practices or
publishes any advertisements that are false or misleading. This Act gives the Consumer
Protection Authority the authority to look into deceptive advertising and unfair business
practices. The government codes include the Press Council of India’s Norms of Journalistic
Conduct, the Code for Commercial Advertising on Doordarshan, the All India Radio Code
for Commercial Broadcasting, and the Advertising Code prescribed under the Cable
Television Network (Regulation) Act, 1995. Self-regulation offers many advantages, but it
also has certain disadvantages and restrictions. First of all, voluntary compliance is the
cornerstone for operation. It breaks down when a few companies in the sector decide it’s
better to stray from the industry standard; secondly, the enforcement of voluntary standards
moves very slowly as a result of the trade associations’ lax attitude towards the codes; thirdly,
customers don’t trust business self-regulation; fourthly, media codes appear to be
conventional and orthodox; fifthly, there is no independent apparatus to oversee the
application of these Codes; and sixthly, these codes have no legal support. The government,
advertising agencies, media, trade, and business should give solving the issues raised in this
chapter careful thought. Based on a cursory examination of the preceding discourse, it can be
concluded that deceptive and fraudulent advertising presented a significant risk to both
society and consumers at large. But in order to manage and put an end to this improper
behaviour, we must take the following precautions:
1) Ask yourself these questions before purchasing a product: why, when, where,
how much, how often, how long, etc.
2) Advertising targeted at consumers ought to be morally and truthfully done.
3) The customer must not be misled.

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 4) Make sincere and accurate claims that are necessary to stop deceptive
advertising.
5) Adhere to morality and public decency.
6) Carefully examining the primary demand, purchasing motivations, concealed
characteristics, various benefits, and financial considerations in each
marketing scenario is necessary to ascertain a product’s potential for
promotion.
7) To refrain from endorsing goods that pose a risk to the public or people,
especially children, and to uphold fair competition while considering the needs
of customers.

In the marketing mix, advertising plays a crucial role in the creation of a communication
strategy. A trigger from outside the body awakens latent needs. Customers have “internal
tensions” as a result, and if this kind of advertising is not adequately vetted, it is quite easy
for entertainment corporations in a nation like India to use it to further corruption. Inaccurate
advertising has the potential to compromise and mislead our freedom of choice and purchase
behaviour if it is not adequately regulated and controlled. Nonetheless, steps must to be done
to increase public and NGO awareness among regular users. Law enforcement organisations
shouldn’t ignore or be insensitive to the application of current consumer laws. Children,
teenagers, and patients need to be especially protected from the harm that deceptive and false
advertising can do.

6.1. SUGGESTIONS AND RECOMMENDATIONS

While this work has provided relevant recommendations for bolstering the legal supervision
over commercial promotions. The following is a summary of significant recommendations
that are necessary for improved control of commercial advertisements:
Need for codified law: By modifying and combining the rules pertaining to commercial
advertisements in print and electronic media, Parliament should pass comprehensive
legislation. The proposed law should establish an Advertising Regulatory Authority to
supervise all aspects of the nation's advertising industry within its purview. A viewer's forum
with complete legal support should be established by the proposed legislation so that viewers
can keep an eye on print and electronic media advertisements and voice their disapproval of
any that they deem objectionable.

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Mandatory express clause in the Indian Constitution: The Indian Constitution ought to
have explicit clauses pertaining to the protection and welfare of consumers. Additionally,
"consumer affairs" must be listed as one item on the Concurrent List of the Indian
Constitution's seventh schedule. It is imperative that Schedule 11 be modified as needed to
guarantee the proactive participation of Panchayati Raj establishments in the execution of
consumer welfare initiatives.
Amendment to IT Act, 2000: To combat all forms of electronic advertising, the Information
Technology Act, 2000 should be modified to incorporate rules akin to those found in the
USA's CAN-SPAM (controlling the Assault of NonSolicited Pornography and Marketing)
Act, 2003. The IT Act should specifically forbid false or misleading header information, such
as the sender's email address and domain name, and it should outlaw deceptive subject lines,
which should not mislead the recipient about the message's contents or subject matter. An
interest-based response mechanism or a return email address should be provided by the
sender of the email so that the recipient can request that the sender not send feature emails to
that address, and the sender will comply. The communication from the initiator should clearly
state that it is an advertisement or solicitation and should give his legitimate mailing address.
Product Labelling: It is the duty of the manufacturers and service providers to make sure
that the pricing, product details, benefits, and side effects are all stated on the label. In order
to entice customers, neither the product nor the service provider should engage in deceptive
advertising. This is considered deception and could result in legal action against the service
provider or supplier.
False advertising and claims: Producers of cosmetic items frequently exaggerate the
benefits of their offerings. However, in actuality, not one of them is true. Therefore, the
statements made in the advertisement must be accurate in terms of its uses and outcomes. The
goal of disclosing any footage, segment, or programme that is carried on a news channel that
has been paid for—whether it be an advertisement, advertorial, or other promotion—during
the broadcast should be to prevent viewers from being misled into thinking that the content is
newsworthy. The news station is obligated by the NBSA standards, which were released in
March 2014, to reveal any political affiliations it may have with a party or candidate.
The importance of ethics and morals in defending the public interest: the advertisement
should uphold these values. in order to safeguard the interests of the general public to a
greater degree.

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Use of ADRM and ODRM: "Alternative Dispute Resolution Mechanism" (ADRM) and
"Online Dispute Resolution Mechanism" (ODRM) are basically required for consumer
dispute settlement.
Consumer encouragement: It is important to provide consumers the confidence to report
rights violations. Moreover, defending their interests can be achieved by delivering justice to
them quickly.
Requirement for statutory authority for ASCI or self-regulatory bodies: The Advertising
Standards Council of India, a self-regulatory agency, needs to be granted legislative authority
in order to enhance the effectiveness of self-regulation. A self-regulation scheme that clearly
defines the procedure and implementation machinery can serve as an effective check on
misleading advertisements. The advertisement must adhere to the code of self-regulation,
which forbids the publication of misleading advertisements. Compliance statistics should be
released on a regular basis to reinforce the enforcement mechanism. Negative publicity on
non-compliance with voluntary rules should also occur. This will alert the public and harm
the non-complaining party's goodwill. Lastly, it is recommended to send out cautionary
warnings, often known as "Ad Alerts," to other members, encouraging them to refuse to
provide their services to marketers who are not in compliance or to refuse them access to
advertising space. The voluntary codes such as the Medical Council of India or the Bar
Council of India should be formally recognised in order to prevent advertising organisations'
members and associates from breaking the unified norm. The government ought to
collaborate more closely with ASCI, one of the nation's main self-regulatory advertising
organisations. A violation of the code should be deemed to have occurred if there was an
unjustifiable delay in responding to the decision made under the self-regulation mechanism.
The business community ought to endeavour to enhance the self-regulation scheme's criteria
to the level of pleasure that consumers desire. To make Doordarshan and All India Radio
competitive with both domestic and foreign companies, appropriate amendments to the
television and radio codes should be made. More authority should be granted to the Press
Council of India in order to ensure adherence to its standards of journalistic conduct. It is
recommended that the voluntary codes for the media be modified to incorporate a global
perspective while adhering to the current legal framework. The new Consumer Protection
Act, 2019 has been implemented in India, filling in some of the gaps left by the repeal of the
previous Consumer Protection Act, 1986. Nevertheless, the new Act needs to be changed to
include the following clauses: The Consumer Protection Act's Section 2 (47) should be
appropriately amended to address the following unfair trade practice types:

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  Making false or misleading representations about the place of origin of the good;
 Deceiving job seekers about the nature, availability, and other pertinent job-related
issues.
 A false representation that the product has a certain history or usage.
 Make false claims that a specific segment has committed to purchasing products or
services.

b) One of the new CP Act, 2019's shortcomings is that, unlike the previous Act, it does not
allow consumers to file a complaint with a forum about medical negligence.
c) Cases pertaining to deceptive or false advertising and other unfair trade practices must to
be able to be taken under suomoto cognizance by the Consumer Dispute Redressal Agencies
created under the CP Act. Only inquiries or investigations into violations of consumer rights
or unfair trade practices may be conducted under the new Consumer Protection Act, 2019,
either on a suo motu basis, in response to a complaint, or in accordance with directives from
the Central Government. The Consumer Protection Authority is no longer granted this
authority.
d) Other issues that must be addressed include case arrears, repeated postponements, non-
appearance of parties, lawyer strikes, Peshi practice, and the propensity of attorneys to drag
out litigation.
The authority of contempt should, if required, be granted to the relevant State Commissions
and the National Commission in order to dissuade order offenders. Consumer Dispute
Redressal Agencies must have the authority to order a business owner to give up profits
obtained through deceptive and fraudulent advertising.
To enhance the execution of the CP Act, 2019, the subsequent actions could be
implemented:In order to improve the disposal rate, positions in State Commissions and
District must filled as soon as feasible. It is necessary and sufficient to provide the consumer
forums with adequate infrastructure. The government ought to set up a committee to
investigate the State Commissions' and the District Forum's infrastructure needs.
d) Only in exceptional circumstances, especially when it will be challenging for the forum to
resolve the issues without the lawyers' help, should lawyers be permitted. It is important to
remember that the proposed Consumer Protection Act, 2019 prohibits either party to the
complaint from hiring an advocate in the District Forum or State Commission without the
worth of the goods and services surpasses two lakh rupees, provided that the complainant has
the option to hire an expert in the event that the complaint calls for specialised knowledge. A

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statutory cap should be placed on the number of adjournments in the resolution of consumer
complaints. Adequate measures ought to be implemented to guarantee that monies allocated
by the Central Government to enhance the Consumer Grievance Redressal Form are
employed promptly and exclusively for the intended purpose for which they have been
authorised. There should be legal restrictions on the filing of pointless or vexatious
complaints in order to resolve consumer complaints. By imposing significant costs, the filing
of pointless or vexatious lawsuits before the Consumer Dispute Redressal Agencies at all
levels should be discouraged. The following suggestions must be adhered to:
1. Creating a National Consumer Protection Comprehensive Policy in accordance with the
Weights and Measures Act, the CP Act, the BIS Act, and other relevant laws, with an
emphasis on actively promoting the protection of consumer rights and giving particular
attention to rural areas and underprivileged consumer groups in collaboration with all
relevant parties.
2. The current consumer awareness campaign should be recognised as a National Campaign
in the Five Year Plan (following the model of the e-governance campaign) because it
encompasses all sectors and requires the convergence of resources and skills from all
government departments to be seen at both the federal and state/UT levels.
3. National System for Standardisation to notify national standards for the nation and to
provide a logical framework for the development of clear and trustworthy market/society
driven standards in areas of economic and social activities, particularly in areas affecting
health, safety, and the environment.
4.A national system for compliance and conformity assessment will be implemented in order
to fully coordinate efforts at the national level in the areas of standard enforcement,
accreditation, and product and service certification.
5. Novel Laws and Organisations:
Regarding New Laws and Institutions, the following recommendations are made:
(a) New Laws
National Consumer Protection Authority Act: The Competition Commission of India is not
going to have the authority to deal with unfair trade practices, which have previously been
handled by the MRTPC, so it is proposed that a National Consumer Protection Authority
(NCPA) be established to bridge the legislative gap that will be created when the MRTPC is
wound up.

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