The Lok Sabha on Thursday passed the much-needed Consumer Protection Bill 2018, which seeks to amend the 1986 Act and strengthen rights of Indian consumers.
Introduced by Union Minister of consumer affairs Ram Vilas Paswan, the Bill awaits approval from Rajya Sabha to wholly replace the existing, and largely inadequate, Consumer Protection Act.
To highlight the need for an overhaul in the 30-year-old law, the new Bill lays down recommendations to set up a national level regulator that will proactively accept and address consumer complaints and other key provisions dealing with class actions, product liability, misleading advertisements, and liability for celebrity endorsements. It also takes the developments of a tech-driven consumer era like e-commerce, direct selling, multi-level marketing, and telemarketing into account.
As opposed to the present law which does not have a regulator, the new Bill proposes establishing the Central Consumer Protection Authority (CCPA). This new body will be equipped to handle violation of consumers’ rights, unfair trade practices, false advertisements, besides having an investigation wing with powers of search and seizure to be headed by a Director General.
It will also have the power to recall goods that are dangerous, hazardous or unsafe, to discontinue unfair or prejudicial practices, to celebrity endorsers for misleading ads among others.
The new bill defined false advertisements as those which misrepresent a product (or service), or issue a misleading description or guarantee about its nature, substance, quantity quality, or deliberately conceal crucial information. False endorsers can be levied with a penalty of up to Rs 10 lakhs by the CCPA, the new Bill further read.
The Bill also enhanced the definition of manufacturer/seller/service provider’s “deficiency” to include “negligence or omission or commission by such person which causes loss or injury to the consumer.” It also expanded the definitions of unfair trade practice and unfair contracts.
For redressing and adjudicating consumer complaints concerning defects in goods and deficiency in services, the Bill proposes enhanced pecuniary jurisdiction to set up of a relevant Consumer Dispute Redressal Forum. It also allows the CCPA to file complaints before other forums at the District, State, National levels. Furthermore, the Bill makes the product manufacturer or product seller liable for compensation, should the consumer come to any harm due to a defective product or deficiency in services.
According to the draft Bill, a class action lawsuit can also be filed against the product seller for wielding unlawful control over designing, packing, testing, manufacturing, altering or modifying the product, as well as in cases of failure to mention the dangers involved or issue instructions for proper usage of the product. This will also apply if the seller does not exercise reasonable care in assembling, inspecting or maintaining the product.
An important amendment in the new Bill addresses the widespread menace of adulteration, by making manufacture, sale, storage of products mixed with adulterants punishable .
Despite the proposals which were long overdue, there was substantial opposition to the Bill, which certain members of the Lok Sabha claimed was in of the bureaucracy and against federal structure.
Many believed the new Bill is also not enough to meet challenges and protect the consumer from getting cheated on. PK Biju of the CPI(M), for example, posed a pertinent query about the volume of online trading which is increasing every year. “What steps have been proposed to control this market? No such provision is visible in this Bill, he said during the proceeding.
Amid protests by Congress, TDP, BJD, TMC, NCP JDU, the Bill passed the lower house and is scheduled to go to Rajya Sabha for consideration and implementation. Eleven members participated in the raucous discussion against the passage, even as Paswan tried to placate the protestors, claiming the Bill simply sought to strengthen the existing Bill’s structure and benefit the consumers.
Prarthana Mitra is a staff writer at Qrius