Consumer Protection Bill for tough regime

Deccan Herald, August 10, 2017

By George Cheriyan and Simi T B

The Consumer Protection Bill is expected to be placed in the Lok Sabha in the ongoing monsoon session. The bill was drafted in 2015 and tabled in the Lok Sabha last year. It then went to the Standing Committee on Food and Consumer Affairs and the committee finalised the bill incorporating various comments and suggestions.

Now the bill awaits cabinet approval. The urgent passage of the bill is required for better protection of the interests of the consumers in the country. The Consumer Protection Act (COPRA), 1986 has come as a panacea for consumers and has assumed the shape of the most important legislation enacted in the country during the last several decades. It has accelerated consumer awareness and provided for speedy and inexpensive redressal of their grievances.

However, in the last 30 years, it has not undergone major amendments to deal with the new challenges consumers are facing such as e-commerce, information disclosure, fraud, identity theft, unfair trade practices and misleading advertisements.

The backbone of the COPRA is a three-tier quasi-judicial grievance redressal mechanism, which was supposed to provide simple, speedy, inexpensive and effective dispute resolution to common consumers. However, today the consumer fora itself is burdened with heavy backlog of cases and poor administration that the consumer has to wait for years to get the redressal, defeating the very purpose of setting up the same.

is proved by the 2016 verdict of the Supreme Court in State of UP vs All UP Consumer Protection Bar Association wherein it constituted a three-member committee to examine the working of consumer forums. The findings pointed towards a dismal picture and showed how the redressal system has been losing sheen over the years. As per the National Consumer Disputes Redressal Commission (NCDRC) statistics, there are 4,19,894 cases pending across national, state and district forums, out of which 3,00,087 cases are before the district forums alone.

Due to the disparity in the mode of business, unique practical problems like place of business, jurisdictional issues, non-delivery and delivery of different products from those selected, are indispensable in case of electronic transactions or e-commerce.

Success of unregulated e-commerce has also facilitated expansion of online sale of essential products like medicines. There already exist reports of selling counterfeit, substandard and adulterated drugs and cosmetics that have risked the life of consumers.

Misleading advertising is on the rise. Most of the time sellers give misleading information about quality, safety and usefulness of the products. Consumers are thus misled by false advertisements and made to fall in their trap.

Consumers thus need additional protection, and the current agency – Advertising Standards Council of India – is not doing much addressing this issue as it is just an industry-sponsored self-regulatory body that does not have statutory powers.

After the repeal of the Monopolies and Restrictive Trade Practices Act, 1969 replaced by the Competition Act, 2002 which focused solely on dealing with monopoly and fostering competition, unfair trade practice was left out. Hence, presently, there is no institutional mechanism to deal with the unfair trade practices, including misleading advertisements.

Recognising the need to address these challenges, the government had introduced the Consumer Protection Bill. The legislation proposes the establishment of Central Consumer Protection Authority (CCPA) to protect and enforce the rights of consumers and prevent unfair trade practices. The CCPA will serve as a regulator with the power to act suo motu on complaints. More importantly, it has the power to initiate class action suits including enforcing recall, refund and return of products.

Dispute settlement
The Bill also seeks to provide for alternative dispute settlement channel through mediation cells. This is aimed at making the resolution of consumer disputes less cumbersome, simple and quicker.

Several other new provisions are also incorporated to simplify the existing consumer dispute adjudication process in the consumer fora. These include, enhancing the pecuniary jurisdiction of the consumer grievance redressal agencies, power to review their own orders by the State and District Commission, constitution of Circuit Bench to facilitate quicker disposal of complaints, reforming the process for the appointment of the president and members of the district fora and enabling provisions for consumers to file complaints electronically.

Some praiseworthy recommendations of the Standing Committee to make the current bill more inclusive and stringent include stern provisions to deal with misleading advertisements, apart from heavy penalties, imprisonment for those who endorse such products. This provision is facing opposition from various quarters, including political parties.
The Committee also noticed the omission in addressing ‘deficiency of service’ under the Bill and recommended that the bill should specify conditions for establishing deficiency in services. Certainly, if such a revised bill is introduced and passed, it stands to be much stronger.

But one should remember that only quick disposal of consumer disputes and effective and timely implementation of the law forms the bedrock principle of an effective consumer protection. The government should therefore ensure strict enforcement of the provisions once the bill becomes a law.

(Cheriyan is Director and Simi is Policy Analyst at CUTS International, Jaipur)

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