Comparative Analysis of Consumer Protection Act 1986 and 2019

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This post has been written by Shaily Jain, a second year law student from Amity Law School, Amity University, Chhattisgarh.

Consumer Protection Act, 1986:

The development of a nation is often measured by multiple parameters; and economic well-being invariably becomes a crucial parameters. This involves transactions and other dealings and at one end of such trades, are the consumers whose rights ought to be protected. Hence, it was important for a country like India to have legislations that dealt with promotion of interests of consumers and thus came about the legislation of Consumer Protection Act, 1986.

With the rapid expansion in trade and commerce, the traders had an unfair upper hand over the consumers and this was a direct consequence of industrialisation. Consumers had little or no knowledge about the rights available to them and hence were pushed to a disadvantage.

 But, it was only in 1986 that the law-makers of the nation decided to structure and streamline the efforts made towards protecting consumers’ interests and stressed for the need of a welfare legislation in the form of the Consumer Protection Act, 1986.

The introduction of the COPRA in 1986 was to protect the interests of the consumers and to safeguard their rights as well. It provided a multi-dimensional approach to promote consumer interests which included spreading of awareness and establishment of consumer councils.  This provided a platform for the consumers to settle consumer disputes. It also envisioned this to be a medium that would facilitate a faster and efficient way for redressal.

The aim and objective along with the purpose for which the act was established, is explained under Section 6, 8 and 8B of the Consumer Protection Act, 1986. Section 6 goes on to detail the rights which the act aims to protect and lists them as:

  1. Right to safety of life and property from hazardous goods.
  2. Right to information about the quality, quantity, potency, purity, standard and price of goods and services so as to protect consumers against unfair trade practices.
  3. Right to choice as to variety of goods and services.
  4. Right to be heard and representation and to be assured that consumer interests will receive due consideration at appropriated platform.
  5. Right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers.
  6. Right to consumer education

Consumer Protection Act 2019 Comes Into Force: Key Things To Know

The Consumer Protection Act, 2019 comes into force on July 20 ( Monday), replacing the more than 3-decade old Consumer Protection Act 1986. The new law aims to enforce and protect the rights of consumers, and provide an effective mechanism to address consumer grievances.

The Consumer Protection Bill, 2019 was introduced in the Upper House of Parliament by the Minister of Consumer Affairs, Food and Public Distribution, Ram Vilas Paswan, on July 8, 2019. It was passed by the Lok Sabha on July 30, 2019 and Rajya Sabha on August 6, 2019. The Bill was then signed into law by President Ram Nath Kovind on August 9 last year.

The Consumer Protection Act 2019 will be more holistic and stringent after rules are framed to protect the interest of the consumers, Union Minister for Consumer Affairs, Food and Public distribution, Ram Vilas Paswan said at a press conference today. A meeting of former Secretaries of the Consumer Affairs Department and Members of Parliament will be held this month to finalise the rules, the minister added.

The Act proposes the establishment of a Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers, and make interventions in situations of unfair trade practices.

The Act provides for a simplified dispute resolution mechanism, with a provision for mediation and e-filing of cases. The consumers can file complaints at a district or state consumer commission closest to their residence, rather than the location where the service or products were sold. Consumers can drag manufacturers and sellers of adulterated and spurious products to court and claim compensation, as is applicable.

Under the aegis of the new Consumer Protection Act, 2019, a product manufacturer and seller will be liable to provide compensation for injury or damage caused by a defective product or service. The errant businesses will be penalized with up to 6 months in jail or a fine of up to Rs 1 lakh if the consumers do not suffer any injuries. In cases where the consumer is injured, the fine to the manufacturer, seller or distributor could go up to Rs 5 lakh and up to seven years in jail. In case of death of the consumer, the culprit will have to pay a minimum fine of Rs 10 lakh and spend seven years in jail, which can be extended to life imprisonment.

Differences between Consumer Protection Act, 1986 and Consumer Protection Act, 2019

S.No. Basis Consumer Protection Act, 1986 Consumer Protection Act, 2019
1 Ambit of law All goods and services for consideration, while free and personal services are excluded All goods and services, including telecom and housing construction, and all modes of transactions (online, teleshopping, etc.) for consideration. Free and personal services are excluded
2 Unfair trade practices (Defined as deceptive practices to promote the sale, use or supply of a good or service) Includes six types of such practices, like false representation, misleading advertisements The new Act adds three types of practices to the list, namely: failure to issue a bill or receipt;  refusal to accept a good returned within 30 days; and  disclosure of personal information given in confidence, unless required by law or in public interest. Contests/ lotteries may be notified as not falling under the ambit of unfair trade practices.  
3 Product liability No Provision Claim for product liability can be made against manufacturer, service provider, and seller. Compensation can be obtained by proving one of the several specified conditions in the Act.
4 Unfair contracts No Provision Defined as contracts that cause significant change in consumer rights. Lists six contract terms which may be held as unfair.
5 Central Protection Councils (CPCs) CPCs promote and protect the rights of consumers. They are established at the district, state, and national level. The new Act makes CPCs advisory bodies for promotion and protection of consumer rights. Establishes CPCs at the District, State and National Level.
6 Regulator No Provision Establishes the Central Consumer Protection Authority (CCPA) to promote, protect, and enforce the rights of consumers as a class.   CCPA may: issue safety notices;  pass orders to recall goods, prevent unfair practices, and reimburse purchase price paid; and  impose penalties for false and misleading advertisements.  
7 Pecuniary jurisdiction of Commissions District: Up to Rs 20 lakh; State: Between Rs 20 lakh and up to Rs one crore; National:  Above Rs one crore. District: Up to Rs one crore; State: Between Rs one crore and up to Rs 10 crore; National:  above Rs 10 crore.
8 Composition of Commissions District: Headed by current or former District Judge and two members. State:  Headed by a current or former High Court Judge and at least two members. National:  Headed by a current or former Supreme Court Judge and at least four members. District:  Headed by a president and at least two members. State:  Headed by a president and at least four members. National:  Headed by a president and at least four members
9 Appointment Selection Committee (comprising a judicial member and other officials) will recommend members on the Commissions. No provision for Selection Committee.  Central Government will appoint through notification.  
10 Alternate dispute redressal mechanism No Provision Mediation cells will be attached to the District, State, and National Commissions
11 Penalties If a person does not comply with orders of the Commissions, he may face imprisonment between one month and three years or fine between Rs 2,000 to Rs 10,000, or both.  If a person does not comply with orders of the Commissions, he may face imprisonment up to three years, or a fine not less than Rs 25,000 extendable to Rs one lakh, or both.  
12 E-commerce No Provision Defines direct selling, e-commerce and electronic service provider. The central government may prescribe rules for preventing unfair trade practices in e-commerce and direct selling.

CONCLUSION

As is evident, CPA 2019 has made several changes to the erstwhile CPA 1986. CPA 2019 has widened the reach of consumer protection regime in India. The changes made vide CPA 2019 seem to further empower consumers by leveraging responsibilities not only on their counterparts, i.e., the sellers, manufacturers, service providers, but also the endorsers of such products. It also attempts to address the issues that were not comprehensively touched upon by CPA 1986, such interests of consumers as a class, etc.

CPA 2019 has also attempted to ease and fasten the process of consumer disputes resolution by increasing the pecuniary jurisdiction of the commissions, attaching mediation cells, increasing the members of the commissions, imposing higher penalties etc.

The ramifications of CPA 2019 cannot be precisely gauged beforehand, as many new concepts have been introduced. However, what can definitely be said is that everyone involved in a transaction, other than the consumer, will have to be more careful, and cautious than ever before.

REFERENCES

  • https://zeenews.india.com/economy/new-consumer-protection-act-2019-comes-into-force-today-know-how-it-will-benefit-you-2297012.html
  • https://www.thehindu.com/news/national/tamil-nadu/new-consumer-protection-act-gives-more-power-to-consumers-experts-say/article32135908.ece 
  • Also read https://lawlex.org/lex-pedia/the-new-consumer-protection-act-2019/24942
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