On August 6, 2019, Parliament enacted the Consumer Protection Bill, 2019 to replace the Consumer Protection Act, 1986. (“1986 Act”). On August 9, 2019, the President of India signed the Consumer Protection Act, 2019 (“2019 Act”), which went into effect on the date set by the Central Government.
The Central Government has announced the majority of the provisions of the 2019 Act, which will take effect on July 20, 2020, via a notification dated July 15, 2020.
Differences between the 1986 Act and the 2019 Act are detailed below:
- Unfair Contracts: 2019 Act –A contract between a manufacturer or trader and consumer will be deemed to be unfair if it causes a significant change in rights of a consumer, namely:
- Requiring the consumer to deposit excessive security deposit for the performance of the contract
- Imposing any penalty on the consumer for breach of contract
- refusing to accept early repayment of debts on payment of applicable penalty
- Allowing unilateral termination of contracts
- Allowing assignment of contract to the detriment of the consumer.
- Imposing any unreasonable charge, obligation or condition which puts such consumer to disadvantage.
1986 Act- No Provision
2. Product liability: 2019 Act –
Claim for product liability can be made against the manufacturer, service provider, and/or seller to compensate for any harm caused to the consumer because of a defective product or service. Compensation can be obtained by proving one of the several specified conditions in the 2019 Act.
1986 Act – No Provision
3. Consumer : 2019 Act –
Expressly includes goods or services availed through online transactions using any electronic means, teleshopping, direct selling and multi-level marketing.
1986 Act –
Did not expressly include online transactions and teleshopping.
4. Unfair trade practices: 2019 Act –
Widens the scope of unfair trade practice by including even the following within its ambit:
- 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.
1986 Act –
Defined to include false or misleading representation, assigning the product or service a warranty/guarantee that is not based on adequate testing, materially misleads the public and indulges in false advertising.
5. Penalties: 2019 Act –
Where any person does not comply with orders of the Commissions, they may be punishable with imprisonment between one month and three years, or a fine between Rs. 25,000 and Rs. 1 Lac, or both. There are other offences for which penalties are imposed such as, sale of products containing adulterant and sale/distribution/import of spurious goods.
1986 Act –
Where any person does not comply with orders of the Commissions, they may be punishable with imprisonment between one month and three years, or a fine between Rs. 2,000 and Rs. 10,000, or both.
6. Pecuniary jurisdiction of Commissions: 2019 Act –
District: Up to Rs. 1 crore; State: Between Rs. 1 crore and Rs. 10 crores; National: Above Rs. 10 crores.
District: Up to Rs. 20 lakhs; State: Between Rs. 20 lakhs and Rs. 1 crore; National: Above Rs. 1 crore.
7. Appeal from an order of District Commission: 2019 Act –
Time limit to file an appeal before the State Commission has been increased to 45 days. No appeal will be entertained before the State Commission unless 50% of the amount is deposited.
Time limit to file an appeal before the State Commission was 30 days.
No appeal will be entertained until a deposit is made i.e. 50% of the amount or Rs. 25,000, whichever is lesser.