UNIT 5: CONSUMER PROTECTION ACT,

2019
• 8 chapters 107 sections
OBJECTIVE
• PROTECTION OF INTERESTS OF CONSUMERS
• ESTABLISH AUTHORITIES FOR TIMELY AND EFFECTIVE ADMINISTRATION, SETTLEMENT OF
CONSUMER’S DISPUTES;
SCHEME OF THE ACT
I. PRELIMINARY
II. CONSUMER PROTECTION COUNCILS
III. CENTRAL CONSUMER PROTECTION AUTHORITY
IV. CONSUMER DISPUTES REDRESSAL COMMISSION
V. MEDIATION
VI. PRODUCT LIABILITY
VII. OFFENCES AND PENALTIES
VIII. MISCELLANEOUS
CONSUMER 2(7)
• means any person who—
• (i) buys any goods for a consideration which has been paid or promised or partly paid and partly
promised, or under any system of deferred payment and includes any user of such goods other
than the person who buys such goods for consideration paid or promised or partly paid or partly
promised, or under any system of deferred payment, when such use is made with the approval of
such person, but does not include a person who obtains such goods for resale or for any
commercial purpose; or
• (ii) hires or avails of any service for a consideration which has been paid or promised or partly
paid and partly promised, or under any system of deferred payment and includes any beneficiary
of such service other than the person who hires or avails of the services for consideration paid or
promised, or partly paid and partly promised, or under any system of deferred payment, when
such services are availed of with the approval of the first mentioned person, but does not include
a person who avails of such service for any commercial purpose. Explanation. —For the purposes
of this clause, — (a) the expression "commercial purpose" does not include use by a person of
goods bought and used by him exclusively for the purpose of earning his livelihood, by means of
self-employment; (b) the expressions "buys any goods" and "hires or avails any services" includes
offline or online transactions through electronic means or by teleshopping or direct selling or
multi-level marketing;
(8) "consumer dispute" means a dispute where the person against
whom a complaint has been made, denies or disputes the allegations
contained in the complaint.
(9) "consumer rights" includes,-- (i) the right to be protected against the
marketing of goods, products or services which are hazardous to life and
property; (ii) the right to be informed about the quality, quantity,
potency, purity, standard and price of goods, products or services, as the
case may be, so as to protect the consumer against unfair trade
practices; (iii) the right to be assured, wherever possible, access to a
variety of goods, products or services at competitive prices; (iv) the right
to be heard and to be assured that consumer's interests will receive due
consideration at appropriate fora; (v) the right to seek redressal against
unfair trade practice or restrictive trade practices or unscrupulous
exploitation of consumers; and (vi) the right to consumer awareness
(6) "complaint" means any allegation in writing, made by a complainant for obtaining any relief provided by
or under this Act, that—
(i) an unfair contract or unfair trade practice or a restrictive trade practice has been adopted by any
trader or service provider;
(ii) the goods bought by him or agreed to be bought by him suffer from one or more defects;
(iii) the services hired or availed of or agreed to be hired or availed of by him suffer from any deficiency;
(iv) a trader or a service provider, as the case may be, has charged for the goods or for the services
mentioned in the complaint, a price in excess of the price— (a) fixed by or under any law for the time
being in force; or (b) displayed on the goods or any package containing such goods; or (c) displayed on
the price list exhibited by him by or under any law for the time being in force; or (d) agreed between
the parties;
(v) the goods, which are hazardous to life and safety when used, are being offered for sale to the public--
(a) in contravention of standards relating to safety of such goods as required to be complied with, by
or under any law for the time being in force; (b) where the trader knows that the goods so offered are
unsafe to the public;
(vi) the services which are hazardous or likely to be hazardous to life and safety of the public when used,
are being offered by a person who provides any service and who knows it to be injurious to life and
safety;
(vii) (vii) a claim for product liability action lies against the product manufacturer, product seller or product
service provider, as the case may be;
2(10) "defect" means any fault, imperfection or shortcoming in the
quality, quantity, potency, purity or standard which is required to be
maintained by or under any law for the time being in force or under any
contract, express or implied or as is claimed by the trader in any
manner whatsoever in relation to any goods or product and the
expression "defective" shall be construed accordingly;
2(11) "deficiency" means any fault, imperfection, shortcoming or
inadequacy in the quality, nature and manner of performance which is
required to be maintained by or under any law for the time being in
force or has been undertaken to be performed by a person in pursuance
of a contract or otherwise in relation to any service and includes— (i)
any act of negligence or omission or commission by such person which
causes loss or injury to the consumer; and (ii) deliberate withholding of
relevant information by such person to the consumer;
2(12) "design", in relation to a product, means the intended or known physical and
material characteristics of such product and includes any intended or known
formulation or content of such product and the usual result of the intended
manufacturing or other process used to produce such product;
2(13) "direct selling" means marketing, distribution and sale of goods or provision
of services through a network of sellers, other than through a permanent retail
location;
2(21) "goods" means every kind of movable property and includes "food" as
defined in clause (j) of sub-section (1) of section 3 of the Food Safety and Standards
Act, 2006 (34 of 2006);
2(24) "manufacturer" means a person who— (i) makes any goods or parts thereof;
or (ii) assembles any goods or parts thereof made by others; or (iii) puts or causes
to be put his own mark on any goods made by any other person;
2(45) "trader", in relation to any goods, means a person who sells or distributes any
goods for sale and includes the manufacturer thereof, and where such goods are
sold or distributed in package form, includes the packer thereof;
2(16) "e-commerce" means buying or selling of goods or services
including digital products over digital or electronic network;
2(17) "electronic service provider" means a person who provides
technologies or processes to enable a product seller to engage in
advertising or selling goods or services to a consumer and includes any
online market place or online auction sites;
2(18) "endorsement", in relation to an advertisement, means— (i) any
message, verbal statement, demonstration; or (ii) depiction of the
name, signature, likeness or other identifiable personal characteristics
of an individual; or (iii) depiction of the name or seal of any institution
or organisation, which makes the consumer to believe that it reflects
the opinion, finding or experience of the person making such
endorsement;
2(22) "harm", in relation to a product liability, includes— (i) damage to
any property, other than the product itself; (ii) personal injury, illness or
death; (iii) mental agony or emotional distress attendant to personal
injury or illness or damage to property; or (iv) any loss of consortium or
services or other loss resulting from a harm referred to in subclause (i) or
sub-clause (ii) or sub-clause (iii), but shall not include any harm caused to
a product itself or any damage to the property on account of breach of
warranty conditions or any commercial or economic loss, including any
direct, incidental or consequential loss relating thereto;
2(23) "injury" means any harm whatever illegally caused to any person, in
body, mind or property;
2(28) "misleading advertisement" in relation to any product or service,
means an advertisement, which— (i) falsely describes such product or
service; or
(ii) gives a false guarantee to, or is likely to mislead the consumers as to
the nature, substance, quantity or quality of such product or service; or
(iii) conveys an express or implied representation which, if made by the
manufacturer or seller or service provider thereof, would constitute an
unfair trade practice; or (iv) deliberately conceals important
information;
2(33) "product" means any article or goods or substance or raw material or
any extended cycle of such product, which may be in gaseous, liquid, or
solid state possessing intrinsic value which is capable of delivery either as
wholly assembled or as a component part and is produced for introduction
to trade or commerce, but does not include human tissues, blood, blood
products and organs;
2(34) "product liability" means the responsibility of a product
manufacturer or product seller, of any product or service, to compensate
for any harm caused to a consumer by such defective product
manufactured or sold or by deficiency in services relating thereto;
2(35) "product liability action" means a complaint filed by a person before
a District Commission or State Commission or National Commission, as the
case may be, for claiming compensation for the harm caused to him;
2(36) "product manufacturer" means a person who— (i) makes any
product or parts thereof; or (ii) assembles parts thereof made by
others; or (iii) puts or causes to be put his own mark on any products
made by any other person; or (iv) makes a product and sells, distributes,
leases, installs, prepares, packages, labels, markets, repairs, maintains
such product or is otherwise involved in placing such product for
commercial purpose; or (v) designs, produces, fabricates, constructs or
re-manufactures any product before its sale; or (vi) being a product
seller of a product, is also a manufacturer of such product;
2(38) "product service provider", in relation to a product, means a
person who provides any service in respect of such product;
2(37) "product seller", in relation to a product, means a person who, in the course of
business, imports, sells, distributes, leases, installs, prepares, packages, labels, markets,
repairs, maintains, or otherwise is involved in placing such product for commercial
purpose and includes-
(i) a manufacturer who is also a product seller; or
(ii) a service provider, but does not include—
(a) a seller of immovable property, unless such person is engaged in the sale of
constructed house or in the construction of homes or flats;
(b) a provider of professional services in any transaction in which, the sale or use of a
product is only incidental thereto, but furnishing of opinion, skill or services being
the essence of such transaction;
(c) a person who— (I) acts only in a financial capacity with respect to the sale of the
product; (II) is not a manufacturer, wholesaler, distributor, retailer, direct seller or an
electronic service provider; (III) leases a product, without having a reasonable
opportunity to inspect and discover defects in the product, under a lease
arrangement in which the selection, possession, maintenance, and operation of the
product are controlled by a person other than the lessor;
2(41) "restrictive trade practice" means a trade practice which tends to bring
about manipulation of price or its conditions of delivery or to affect flow of
supplies in the market relating to goods or services in such a manner as to impose
on the consumers unjustified costs or restrictions and shall include-- (i) 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; (ii) any trade
practice which requires a consumer to buy, hire or avail of any goods or, as the
case may be, services as condition precedent for buying, hiring or availing of other
goods or services;
2(42) "service" means service of any description which is made available to
potential users and includes, but not limited to, the provision of facilities in
connection with banking, financing, insurance, transport, processing, supply of
electrical or other energy, telecom, boarding or lodging or both, housing
construction, entertainment, amusement or the purveying of news or other
information, but does not include the rendering of any service free of charge or
under a contract of personal service;
2(46) "unfair contract" means a contract between a manufacturer or trader or
service provider on one hand, and a consumer on the other, having such terms
which cause significant change in the rights of such consumer, including the
following, namely:--
(i) requiring manifestly excessive security deposits to be given by a consumer for
the performance of contractual obligations; or
(ii) imposing any penalty on the consumer, for the breach of contract thereof
which is wholly disproportionate to the loss occurred due to such breach to the
other party to the contract; or
(iii) refusing to accept early repayment of debts on payment of applicable penalty;
or
(iv) entitling a party to the contract to terminate such contract unilaterally, without
reasonable cause; or
(v) permitting or has the effect of permitting one party to assign the contract to the
detriment of the other party who is a consumer, without his consent; or
(vi) imposing on the consumer any unreasonable charge, obligation or condition
which puts such consumer to disadvantage;
2(48)-UNFAIR TRADE PRACTICE
1. False representation of goods or services as being of a particular standard quality or grade
2. Falsely representing second hand goods as new goods
3. Falsely representing that goods or services have sponsorship, approval, affiliation or uses or benefits
4. Falsely claiming about warranty or guarantee of performance without any adequate proof or adequate
test
5. False misleading facts disparaging goods, services or trade of another person (statement on wrapper,
accompanying article, advertisement
6. False publication of bargain prices without any intention to fulfil the same or withholding the delivery of
goods etc or any scheme, lottery
7. Hoarding goods to raise prices
8. Not issuing bill or receipt
9. Manufacturing and selling spurious goods (not genuine goods)
10. Refusing to take back or withdraw defective goods, issue refund, or discontinue deficient services
11. Disclosing to other person any personal information given in confidence by the consumer unless such
disclosure is made in accordance with the provisions of law for the time being in force
Central Consumer Protection Councils (3,4,5)
• CCPC or central council- advisory body-minister of dept of consumer
afffairs (chairperson), other official and non-official members
• One meeting per year
• Object- render advice on promotion and protection of consumer
interests.
STATE CONSUMER PROTECTION COUNCILS (6,7)
• 2 meetings per year
DISTRICT CONSUMER PROTECTION COUNCILS (8, 9)
District collector, other official non official members
2 Meetings per year
CENTRAL CONSUMER PROTECTION
AUTHORITY (10-27)
• Regulate matters relating to violation of consumer rights, unfair trade practices,
false or misleading advertisements-prejudicial to the interests of public and
consumers-protect and enforce rights of consumers as a class
• Chief commissioner and other commissioners
• HQ at Delhi and other regional offices
• CCPA may engage experts and professionals with special knowledge in
consumer rights and welfare, consumer policy, law, medicine, food safety,
health, engineering, product safety, commerce, economics, public affairs etc
• Section 15-investigation wing
• Section 16-dist collector may investigate on ref by central authority or
commissioner or on receipt of complaint and submit report to central authority
or regional commissioner as may be required
• Section 17-complaint in writing or electronic mode to any of the authorities
Section 19-21: suo motu inquiry and investigation. If evidence suggests
violation of consumer rights, unfair trade practice- pass orders for
- Recalling of goods or withdrawal of services which are dangerous,
hazardous or unsafe
- Reimbursement of prices
- Discontinuation of practices unfair and prejudicial to consumer’s
interest
- discontinue advertisements
- Impose penalty up to Rs. 10 lakhs
- Prohibit endorser from making endorsement
Power of search and seizure under section 22
Appeal on order pass by central authority to National Commission within
30 days under section 24
District consumer disputes redressal commission (28-41)
• 28-establishment of DCDRC in each district
• 34-jurisdiction- value of goods or services does not exceed Rupees one crore
–local limits where the opposite party ordinarily resides or carries on
business or has a branch office or personally works for gain
• Opposite party voluntarily resides provided the cause of action wholly or
partly arises, complainant resides or personally works for gain
• 35- who can file a complaint?-consumer, recognised consumer association,
one or more consuemr, CG, Central authority or SG –electronic filing of
complaint
• 36-every proceeding by President and atleast one member-admissibility of
complaint to be decided within 21 days or else deemed to be admitted
• 37-mediation-after first hearing or later-DC may direct parties to give in
writing within 5 days consent to have the dispute settled by mediation
• Admission of complaint u/s 38-after receiving complaint-opp party to
submit defence within 30 days
• Refer samples to labs for testing-obtain report in 45 days-complainant
may object to manner of testing etc
• Decide the complaints on merits or ex parte or on basis of evidence
• DC may require electronic service provider to provide information,
documents or records as may be specified in that order
• Disposal of complain in 3 months (where no lab testing is required)
and 5 months if lab testing is required
• DC vested with powers of civil court under CPC 1908 for summoning
and enforcing attendance of defendant or witnesses, examining them
on oath, discovery and production of document as evidence etc
Findings and orders that can be passed by DC u/s 39
• Remove defect as pointed out by lab
• Replace goods
• Refund/return price paid
• Pay compensation for loss or injury suffered due to negligence of opp party
• Compensation for product liability
• Remove deficiency in services
• Discontinue unfair trade practice
• Not to offer hazardous, unsafe goods for sale
• Withdraw hazardous goods from sale
• Cease manufacture of hazardous goods
• Pay compensation in class action suits against large no of consumers
• Issue corrective advertisments
• Provide adequate costs
• Cease from issuing misleading advertisements
• Appeal u/s 41 within 45 days to State commission
• No appeal after mediation
• If appeal by opp party 50% of amount to be deposited
State consumer disputes redressal commission-(42-52)
• President and 4 or more members
• Section 47-pecuniary jurisdiction-value of goods and services between
1 crore and 10 crores; territorial jurisdiction-ordinarily resides, carries
on business, personally works for gain, cause of action wholly or partly
arises, ;
• Appeal to National Commission u/s 51 within 30 days
• 52- dispose within 90days
National consumer disputes redressal commission (52-73)
• President and 4 or more members
• Duration in office-5 years; eligible for reappointment; age-limit for
president-70 years, members-67 years
• Jurisdiction-value of goods and services exceeds Rs. 10 crores;
appeals from State commission and central authority
• Any unfair terms of contract may be declared null and void by NC u/s
59
• Appeal to Supreme court within 30 days
Section 68-finality of order of DC, SC, NC if no appeal preferred as per
Act.
Section 71-orders of DC, SC & NC shall be enforced as if it is a decree
made by a court in a civil suit under CPC. Failure to comply with orders
of court punishable with imprisonment for not less than 1 month up to
3 years or fine not less than Rs.25,000 up to Rs.1 lakh rupees
Mediation (74-81)
• Consumer mediation cell attached to National Commission and each
of the regional benches- cell maintains list of empanelled mediators,
list of cases handled by cell, rrecord of proceeding- quarterly report to
be submitted to NC or SC
• Section 80-settlement through mediation-reduced in writing and
signed by both parties
• 81- record settlement within 7 days of receipt of settlement report
• If not settlement commission to continue to hear the dispute
Product liability (82-87)
• Harm caused due to defective product or serviced by product service
provider or sold by product seller
• Against manufacturer, product service provider, product seller
• Liability for –defective product, defective design in product, deviation
from manufacturing specifications, product does not conform to
express warranty-no adequate instructions of correct usage to
prevent harm-no warning regarding improper usage
• Strict liability-manufacturer liable even if he proves he was not
negligent or fraudulent in making express warranty of product
Product seller-86
• Liable only if he has exercised substantial control over designing,
testing, mmanufcturing, packaging labelling of product
• Altered or modified product which was substantial in causing harm
• Express warranty independent of manufacturer
• Identity of product manufacturer unknown or he is not subject to
Indian law
• No liability if product was misused altered or modified at the timeo f
harm
• Product under influence of alcohol
• Not prescribed by medical practitioner
Offences and penalties (88-93)
• The offences and penalties listed under this Act are mentioned as follows.
1. Punishment for false and misleading advertisements: Under Section 89 of the Act any manufacturer
or service provider who promotes false or misleading advertisements will be punished with imprisonment
for a term that may extend to two years and with fine that may extend to ten lakh rupees.

2. Punishment for manufacturing, selling, distributing products containing

• adulterants: Under Section 90 of the Consumer Protection Act, 2019 any person who sells,
manufactures, distributes products containing adulterants shall be penalised in case of the following
circumstances;
• If the adulterated product does not cause any injury to the consumer then the term for imprisonment will
extend to a period of six months and fine which may extend to one lakh rupees,
• If the product containing adulterant causes injury not amounting to grievous hurt then the term for
imprisonment will extend to a period of one year and fine which may extend to three lakh rupees,
• If the product containing adulterant causes injury amounting to grievous hurt then the term for
imprisonment will extend to a period of seven years and fine which may extend to five lakh rupees,
• If the product results in causing death to the consumer then the term for imprisonment will be for a period
of seven years which may extend to life imprisonment and fine not less than ten lakh rupees.

3. Punishment for manufacturing, selling, and distributing spurious products: Section 91 states that
any person who sells, manufactures, or distributes spurious products shall be punished for such acts.