A COMPARISION BETWEEN THE CONSUMER PROTECTION ACT 1986 AND THE CONSUMER PROTECTION ACT 2019 VERSION- A BRIEF ANALYSIS

THE CONSUMER PROTECT ACT: A BENEVOLENT SOCIAL LEGISLATION

The consumer Protection Act is a law to protect the interests of the consumers, by providing safety to consumers regarding defective products, deficiency in services and unfair trade practises. The overriding aim of this Act is to protect the consumer and the Rights of the consumer by establishing authorities for effective administration and timely settlement of Consumer disputes.

ORIGIN /PROVENANCE OF THE ACT:

With the advent of the Industrial revolution and the constant upliftment of the trade and commerce in the international sector, plethora of goods and services have come to the market to cater the needs and demands of the consumers. The decline in the application of the principle of consumer sovereignty was the by-product of the well-organized sector of manufacturers and traders who have a better knowledge of the market place, thus, jeopardizing the relationships with the consumers. A free-market economy, where the customer is considered to be the king, used to run on the principle of caveat emptor (let the buyer be aware) which then saw a shift to caveat venditor (let the seller be aware). This shift was aimed at the protection of the public from the sub-standard and adulterated production and advertisement of articles and services, where a consumer is put before a product or service available to him from various sources with very little time to select. Hence the Consumer Protection Act of 1986 is important in the history of India, where such an Act was enacted to protect the interests of consumers from exploiting, profit-centred and unfair trade practices.

THE CONSUMER PROTECTION ACT, 1986:

The Consumer Protection Act, 1986 came into force on 24th December 1986 which extended to the whole of India, except the state of Jammu and Kashmir. This Act protects the interests of the consumer and provides safety to consumers regarding defective products , dissatisfactory services and unfair trade practices. The basic aim of the Consumer Protection Act, 2019 is to save the rights of the consumers by establishing authorities for timely and effective administration and settlement of consumers’ disputes.

STRUCTURE AND WORKING:

As per the Act, a three-tier grievance redressal machinery; District, State and National level respectively was established, with a time-bound redressal. The provisions of the Act were compensatory, preventive and punitive.

RIGHTS OF THE CONSUMER:

The Consumer Protection Act, 1956 protects the following rights for the consumers:

• (a) the right to be protected against marketing of goods which are hazardous to life and property;
• (b) the right to be informed about the quality, quantity, potency, purity, standard and price of goods to protect the consumer against unfair trade practices;
• (c) the right to be assured, wherever possible, access to an authority of goods at competitive prices;
• (d) the right to be heard and to be assured that consumers interests will receive due consideration at appropriate forums;
• (e) the right to seek redressal against unfair trade practices or unscrupulous exploitation of consumers; and
• (f) right to consumer education.

These objects are sought to be promoted and protected by the Consumer Protection Council to be established at the Central and State level. The Act also punishes those who make frivolous and meaningless complaints.

THE CONSUMER PROTECTION ACT 2019:

It is important to accept and appreciate the fact that we are living in the Digital Age which has ushered in a new era of commerce and digital branding, as well as a new set of customer expectations. Digitization has provided easy access, a large variety of choices, convenient payment mechanisms, improved services and shopping as per convenience. However, there are also associated challenges related to consumer protection. To help address the new set of challenges faced by consumers in the digital age, the Indian Parliament passed the landmark Consumer Protection Bill, 2019 which aims to provide timely and effective administration and settlement of consumer disputes.

A COMPARISION BETWEEN THE 1986 AND 2019 VERSIONS OF THE CONSUMER PROTECTION ACT:

The Consumer Protection Act, 2019 was enacted by the Indian parliament which came into force on 9th August 2019, repealing and replacing The Consumer Protection Act of 1986. The new Act proposes a huge number of measures and fixes the current standards to the existing consumer rights. Lets have a look at the changes that are incorporated in the revised Act which is segregated into various heads for easy understanding.

1. CENTRAL REGULATOR-CCPA: Central Consumer Protection Authority (CCPA), a central regulator, is to be formed under the new enactment to strengthen the consumer rights, whereas there was no provision for a regulator in the earlier version. CCPA will be set up by the Central Government and it has wide ranging powers from conducting enquiries into the violations of consumer rights, issuing orders for discontinuation of unfair trade practices, imposition of penalties on entities that flouted the laws etc.
2. PECUNIARY JURISDICTION: According to the new Act the District Forum was renamed to District Commission with the capacity to hear cases up to Rs. 1 crore, whereas the earlier ceiling amount was up to Rs. 20 lakhs. The pecuniary jurisdiction of the State Commission now is Rs. 1crore to 10 crores while the earlier ceiling amount was Rs.20 lakh to 1 crore and the National Consumer Dispute Redressal Commission (NCDRC) can now hear cases for value more than Rs. 10 crores against the earlier limit of above Rs. 1 crore.
3. TERRITORIAL JURISDICTION: Territorial Jurisdiction has been expanded to the place where the complainant resides or personally works for gain as per the new Act, along with the consumer courts in the area where the seller’s or the service provider’s (defendant) office situated under the previous version. Also, the Act enables the parties to seek hearing via video conferencing, therefore, saving both time and money.
4. PRODUCT LIABILITY: The Act also put forward product liability where the consumer can claim compensation for the injury or loss caused by the defected product or service along with the original cost incurred from the manufacturer and service providers. For instance, many mobile blast cases came up in the recent past. Now under the new provisions, the buyer can claim compensation for the injury or loss caused due to the manufacturing defects along with the original cost of the mobile through the same commission. Earlier the parties had to go to civil courts for claiming compensation which usually takes years to settle the matter. Product liability is also extended to the service providers and sellers along with manufacturers.
5. E-COMMERCE: The 2019 Act explicitly brought the e-commerce customers under its ambit by amending the prior definition of the consumer under section 2(7) to inculcate the customers who make purchases online. According to the new set of rules the e-commerce platforms like Flipkart, Amazon etc. are supposed to disclose the address and other details of the seller, and it is the companies’ responsibility to ensure that no fraud or counterfeit products are being sold on their platforms, which if found will be penalised. Refund and exchange details are also to be mentioned clearly on the website, fostering transparency with customers. These steps are apropos with the current situation where online fraud is on hype.
6. ALTERNATE DISPUTE REDRESSAL MECHANISM-MEDIATION CELLS: The court can refer settlement through mediation, and the terms entered by the parties after due consent will have the same effect and value as a court’s order U/s 74. Additionally, under the new Act, the appeal provisions have been changed, where the opposite party is supposed to pay 50% of the cost ordered by the District Commission to the State Commission before the appeal has been made, whereas the earlier ceiling of the maximum amount of Rs. 25k has been discarded. Also, the limitation period for appeal has been increased from 30 days to 45 days, retaining the power to condone the delay. NCDRC can also hear appeals against the order of Central Authority under Section 58 of the Act. If a party is still aggrieved by the order of the National Commission in the exercise of its powers conferred by sub-clause (i) or (ii) of clause (a) of sub-section (1) of section 58, may prefer an appeal against such order to the Supreme Court within thirty days from the date of the order, retaining the power to condone the delay, provided that the party appealing pays 50% of the amount in the order of the National Commission. Section 49(2) and 59(2) of the new Act gives power to the State Commission and NCDRC respectively to declare any terms of the contract, which is unfair to any consumer, to be null and void.
7. POWER OF REVIEW: The power of review has been conferred to District Commission, State Commission and NCDRC (National Consumer Disputes Redressal Commission) under Section 40, 50 and 60 of the Consumer Protection Act, respectively. Power of revision can still be exercised by NCDRC U/s 58(1)(b) and by State commission under 47(1)(b) of the Act. Section 70 provides for administrative control of State Commission over District Commission and that of NCDRC over State Commission. It inter alia provides for an investigation into any allegations against the President and members of a State Commission / District Commission and submitting inquiry report to the State Government concerned along with copy endorsed to the Central Government for necessary action. Section 71 confers the power of execution as provided Under Order XXI, The Code of Civil Procedure, 1908 with such limitation as provided in the section.
8. 8. PENALTIES FOR MIS-LEADING ADVERTISEMENTS: Chapter III of the Act provides for the creation of Central Authority to regulate matters relating to the violation of rights of consumers, unfair trade practices and false or misleading advertisements which are prejudicial to the interests of public and consumers and to promote, protect and enforce the rights of consumers as a class. The Central Authority shall have an Investigation Wing headed by a Director-General to conduct inquiry or investigation under this Act as may be directed by the Central Authority. Period of limitation in the filing of complaint remains 2 years with a provision for condonation of delay power U/s 69 of the Act.
9. RESPONSIBLE ENDORSEMENTS: After thirty-three years of the Consumer Protection Act of 1986, came the amended Act in 2019, as with the advancements in the era of technology, it became the need of the hour to bring the new Act into force. Not only that, the Act also made the endorsers liable for the misleading or false advertisements which according to the previous Act only the manufacturer was accountable for. The Act also came up with the new definition of “Unfair Trade Practices” and the defaulter can be imposed with heavy fines up to fifty lakhs or imprisonment up to 5 years for repeated offences. Right of privacy has also been secured by the Act as it made the disclosure of personal details given in the course of transactions as a punishable offence. The term “Food” has been added in the definition of “goods” U/s 2(21) and “Telecom” has been added in the definition of “service” U/s 2(41).

The redressal agencies under the 1986 Act were given 21 days to either accept or reject a complaint, in the 2019 Act, the complaint will be deemed to be admitted if it is not rejected within the 21 days from the date on which the complaint was filed.

LANDMARK JUDGEMENTS UNDER THE CONSUMER PROTECTION ACT:

Any deliberation on the Consumer Protection Act is incomplete without the mention of certain important judgements. Though there are umpteen numbers of judgements, here are some handful of judgements to throw light on the latest developments in the field of Consumer protection.

Class Action Suit under the Consumer Protection Act- National Commission;

In the case of Ambrish Kumar Shukla & 21 Ors. Vs . Ferrous Infrastructure Pvt. Ltd. Class action suit was recognised by the National Commission where even though the consumers were claiming different reliefs but all shared the same interests of either wanting the possession of their flats or getting damages from the builder, and hence their suit can be clubbed as one suit against the builder. And it’s the court's duty to inform all the consumers interested in the joining of the suit. The commission expressed that simple distinction in the reason for activity among the diverse relief seekers won't be a bar from a class action suit if the idea of the interests claimed by all of them is equivalent. The Commission said that the goal of the enactment must be taken into consideration at the interpretation of the Act, must be done to subserve the goal of the enactment.

Limitation Provision in Consumer Protection Act cannot be strictly construed to disadvantage of Consumer- Supreme Court: In the case of National Insurance Company Ltd. v. Hindustan Safety Glass Works Ltd. & Anr, the Supreme Court held that the provisions of the limitation cannot be construed strictly, especially for the disadvantage of the consumer, where the reason of delay is the supplier, as in this case was the insurance company. If the delay is due to the influence of any outside force than the complainant, then, in that case, some concessions can be awarded. Hence, the Supreme Court allowed the case to be admitted in the National Commission even after the expiry of the limitation period.

Trust cannot Lodge a Complaint under the Consumer Protection Act- Supreme Court In the case of Pratibha Pratisthan & Ors. v. Manager, Canara Bank & Ors held that a trust doesn’t fall under the definitions of “consumer” or “complainant” or even a “person”, therefore, the trust cannot file a case under the Consumer Protection Act.

The question that whether a corporation falls under the definition of “person” U/s 2(1)(m) of the Consumer Protection Act, was answered by the court in affirmation in the case of Karnataka Power Transmission Corporation v Ashok Iron Works Private Limited, [(2009) 3 SCC 240], where the court held that the definition provided under the Act is an inclusive definition, rather than an exhaustive one, and hence the intent of the legislature shall be looked into while interpreting the same. A juristic person won’t be left behind by the legislature on purpose, and hence, considered that corporations to fall under the category of “person” and also liable under the Act.

MEDICAL PROFESSION FALLS WITH IN THE AMBIT OF THE CONSUMER PROTECTION ACT:

In the Indian Medical Association v V.P. Shantha and others case, the court held that even professional services will be considered under the ambit of services under the Consumer Protection Act, such as that of consultation, treatment and diagnosis practised by the medical practitioners, as they have a duty of care towards their patients. In another case of Spring Meadows Hospital & Anr v Harjol Ahluwalia, the court held that as the parents taking their child to the doctor are rendering the services of the doctor for their child, therefore the parents will also fall under the ambit of consumers and both the child and the parents are entitled to compensation.

IMPOSITION OF PENALTY FOR FILING FRIVOLOUS COMPLAINTS- NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION

In the case of Sapient Corporation Employees Provident Fund Trust Vs. HDFC & Ors., the court imposed a fine of Rs 25,000 on the complainant on the ground of filing a frivolous complaint, stating that, the Consumer Protection Act is a social legislation and doesn’t charge any court fees, therefore, held that there needs to be a guard against frivolous and malicious complaints.

CONCLUSION:

The object of both the enactments remains the same which was to protect the rights and interests of the consumer. The steps taken by the 2019 enactment is only to modernize the 1986 Act and to protect the consumers in the dynamic market. The current enactment has just widened its scope in the fields of consumer, goods and services to be at par with the recent developments in the field of technology with e-commerce and a greater market place.

Now, it is the duty of the consumers, to be aware of their rights which can be achieved by mass education and acknowledgement of the laws in place to curb the malpractices of the sellers and manufacturers. The Act has also been a step forward in the structure of its implementation through the grievance redressal machinery which put forward ample provisions to safeguard exploitation both by and against the modern-day consumer. In the ever-changing socio-economic environment, the Act stands at par, with the real test being the implementation of its provisions where the consumer has a better standing against the exploitation as it encourages and ensures strong safeguard.

Though there are concerns over the implementation of the Act, this sure is a move in the right direction by the Government of India which is working towards giving the hope and safeguarding every Consumer who is spending his hard earned money while utilising any service or buying a product and rightly satisfies the basic condition for which this Act was enacted. The implementation of the provisions of the Act will certainly guarantee happy Consumers which in turn will strengthen the faith and trust of citizen towards the judiciary.