The Bill replaced the Consumer Protection Act, 1986.  The Bill enforces consumer rights, and provides a mechanism for redressal of complaints regarding defect in goods and deficiency in services.

The Consumer Protection Act, 1986 enforces rights of consumers, and provides for redressal of complaints at the district, state and national level.  Such complaints may be regarding defects in goods or deficiency in services.  The Act also recognizes offences such as unfair trade practices, which include providing false information regarding the quality or quantity of a good or service, and misleading advertisements.

Over the years, there have been challenges in the implementation of the Act.  A high number of consumers were unaware of their rights under the Act. While the disposal rate of consumer cases was high (about 90%), the time taken for their disposal was long.  It took 12 months on an average to resolve a consumer case.  Also, the Act does not address consumer contracts between a consumer and manufacturer that contain unfair terms.  In this context, the Law Commission of India had recommended that a separate law be enacted and presented a draft Bill in relation to unfair contract terms. Hence, the bill for new Consumer Protection was proposed which was later transformed into an act.

 

Key features:-

  • The Bill sets up Consumer Disputes Redressal Commissions (consumer courts) to hear complaints on matters like:
    1. defect in goods or deficiency in services;
    2. unfair or restrictive trade practices;
    3. excessive pricing;
    4. knowingly selling goods or providing services that do not meet safety norms; and
    5. product liability.

Such complaints can be filed electronically and from where the complainant resides or works.

  • These Commissions will be set up at District, State and National level, with pecuniary jurisdiction up to Rs one crore, Rs one crore to Rs 10 crore, and above Rs 10 crore, respectively.
  • Appeals from the District Commissions will be heard by the State Commission, and from the State Commission by the National Commission. Appeals from the National Commission will be heard by the Supreme Court.
  • The Commissions will attempt to dispose a complaint within three months, if the complaint does not require analysis or testing of commodities. If analysis and testing is required, the complaint will be disposed within a period of five months.
  • The District Commissions will consist of a President and at least two members. The State and National Commissions will consist of a President and at least four members. The qualifications, tenure, and method of appointment and removal of the President and members of these Commissions will be prescribed by central government through notification.
  • The Bill also provides for mediation cells attached to the District, State and National Commissions. The Commissions may refer a matter for mediation if the parties consent to settle their dispute in this manner.