Consumer Protection Legislation in India

This article is written by Ritik Kumar, pursuing his BALLB (Hons.) from Aligarh Muslim University Campus Kerala. 

Meaning of Consumer Protection

Consumer protection is a policy which provides protection to the buyers of goods and services and protects them against unfair trade practices in the marketplace. It also averts businesses from adopting unfair methods such as fraud to mislead consumers. It is the result of an idea of consumer rights. Every consumer has the right to adequate information about goods and services they are purchasing which can be enforced through right to information.[i] Now the question arises, what is adequate information? It was defined by the honourable Supreme Court in case of Samira khan V. Dr Prabha Manchanda as an information which enables the patient (consumer in general) to make a balanced judgement as to whether she should purchase a particular good or hire a particular service or not.[ii]

Who is Consumer? 

A consumer is a person who buys any goods or hires any services by paying something in consideration of that. So, relying on this general definition of consumer, it becomes clear that things given out of love, received in gift or without any payment will not arise any consumer right. Section 2(7) of Consumer protection act 2019 defines consumer as a person who buys any goods or avails a service for a consideration.  It does not include a person who obtains a good for resale or a good or service for commercial purpose.  It covers transactions through all modes including offline, and online through electronic means, teleshopping, multi-level marketing or direct selling. 

Consumer Protection legislation in India 

Modern consumer protection legislation can be traced back to 1860 with the enactment of the Indian Penal Code. There are many statutes which deal with consumer protection laws in India, the principle being the newly enacted Consumer Protection Act, 2019. Other than CP act, consumer rights and protection to them is provided under Indian Penal Code 1860, The Indian Contract Act 1872, The Sales of Goods Act 1930, The Agriculture Produce Act 1937, Drugs and Cosmetics  Act 1940, Certification Marks Act 1952, Essential Commodities Act 1955, etc.

Indian Penal Code, 1860

Accurate measurement is a generally recognized principle of justice and the right of every consumer. If any fraudulent activity is involved in the measurement of goods, it will be an intrusion on consumer rights. IPC criminalizes such acts and a person who uses any false instrument for weighing fraudulently or makes or sells such false weight or measure may be punished for an imprisonment term which may extend to one year, or with fine, or with both.[iii] Adulteration of food or drink intended for sale and sale of noxious food or drink is also a penal offence and a person who committed such an act may sentence to a prison term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.[iv] IPC further criminalizes adulteration of drugs which is done to lessen its effect, change its operation or to make it noxious and sell a drug as a different drug. It is punishable with an imprisonment term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.[v]

Indian Contract Act, 1872

A contract is anything which is agreed between/among parties to contract and enforceable by the laws of the land. It is only binding on the parties to contract. In India contract regulations mainly dealt under Indian Contract Act, 1872 which under its section 27 declared agreement in restraint of trade as void. Hence, it serves consumer interest by promoting competition in the market and protects them from monopolistic market risks. In case of breach of a contact section 73 of the act has provision for compensation for loss or damage caused by such breach.

The Constitution of India

Although the Indian Constitution doesn’t specifically provide for any specific provision, there are few articles which are very important for protecting the rights of consumers. Article 21 of the constitution guarantees every person has the right to live with dignity, free from all kinds of exploitation which means market exploitations will also fall under article 21. Directive Principles are not enforceable in court but they serve as goals and guidelines for the government. Article 47 of the constitution which is part of DPSP requires the state to take steps to prohibit the consumption of intoxicating drinks or drugs which are injurious to health.

Consumer Protection Act, 1986 

This act was enacted by the parliament of India with the following aims and objectives:

  • To prohibit businesses from marketing goods which are hazardous to life and property;
  • To provide a variety of goods at a competitive price;
  • Right to consumer education, redressal against unfair trade practices and to provide consumers adequate information as to the quality, quantity, ingredients, standards and price of goods and services; and
  • To ensure freedom of trade carried on by other participants in the market. 

Attempts had been made to amend this act by consumer protection (amendment) bill 2011, to replace the act by introducing consumer protection bill 2015 and consumer protection bill 2018. It had been replaced by consumer protection act 2019.

Consumer Protection Act, 2019

To address challenges faced by consumers in the digital age, the Indian Parliament enacted a new act namely consumer protection act, 2019 which replace completely consumer protection act, 1986. This act aims to provide timely and effective administration and settlement of consumer disputes. Major changes brought by this act are as follows:

  • In the 1986 Act, there was no provision for product liability which now can arise under the new act against a product manufacturer, product service provider and seller or all of them.
  • The 1986 Act includes six types of unfair trade practices including misleading advertisement and false representation. The new Act adds three types of practices to the list namely failure to issue a bill, refusal to accept a good return within 30 days and disclosure of personal information given in confidence unless required by law.
  • Unfair contracts were not defined in the 1986 Act. The new Act defined them as contracts that cause a significant change in consumer rights.
  • There was no provision for alternative dispute redressal in the old Act. The new Act provides for mediation cells.
  • There were no specific provisions dealing with E-commerce in the 1986 Act. The new act defined e-commerce as buying or selling of goods or services including digital products over a digital or electronic network.[vi]

[i]  The Right to Information is a fundamental right under Article 19 (1) of the Indian Constitution.

[ii]  (2008) 2 SCC 1.

[iii]  Section 264 and 267 of The Indian Penal Code, 1860.

[iv]  Section 272 and 273 of The Indian Penal Code, 1860.

[v]  Section 274 and 276 of The Indian Penal Code, 1860.

[vi]  Section 2(16) of The Consumer Protection Act, 2019.

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