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DAILY NEWS ANALYSIS

  • 31 January, 2024

  • 7 Min Read

Central Consumer Protection Authority

The Central Consumer Protection Authority issues notice to Amazon for sale of sweets under the misleading name of Shri Ram Mandir Ayodhya Prasad.

  • The action has been initiated based on a representation made by the Confederation of All India Traders (CAIT) alleging that Amazon is engaging in deceptive trade practices involving the sale of sweets under the guise of 'Shri Ram Mandir Ayodhya Prasad'.
  • It may be mentioned that under the Consumer Protection (e-commerce) Rules, 2020 no e-commerce entity shall adopt any unfair trade practice, whether in the course of business on its platform or otherwise Further, 'Misleading advertisement' as defined under the Consumer Protection Act, 2019.

Central Consumer Protection Authority

  • As provided in the Consumer Protection Act, 2019, the Central Consumer Protection Authority (CCPA) has been established w.e.f. 24th July, 2020.
  • Objective: To promote, protect and enforce the rights of consumers as a class.
  • Composition:
    • It will have a Chief Commissioner as head, and only two other commissioners as members — one of whom will deal with matters relating to goods while the other will look into cases relating to services.
  • It will be empowered:
    • To conduct investigations into violation of consumer rights and institute complaints / prosecution,
    • Order recall of unsafe goods and services,
    • Order discontinuation of unfair trade practices and misleading advertisements,
    • Impose penalties on manufacturers/endorsers/publishers of misleading advertisements.
  • Nodal Ministry: Ministry of Consumer Affairs, Food & Public Distribution.

Consumer Protection Act 2019

The Consumer Protection Act 2019 defines a consumer under Section 2(7). It states that a consumer is somebody who purchases products or services. You are not considered a consumer if you purchase goods or services for resale or a business.

Unlike the Consumer Protection Act of 1986, this definition encompasses internet transactions. It is carried out to keep up with developing technology and expand online selling and advertising.

Consumer Protection Act 2019 – Rights of Consumer

According to the Consumer Protection Act 2019, consumers have six rights which are as follows:

  • Protection from products and services that endanger life and property.
  • Protection from products and services that risk property and human life.
  • To have access to various products or services at affordable costs.
  • Information about a product’s qualities, costs, and purity will help protect you from unscrupulous practices.
  • Access to a variety of goods and services at affordable pricing.
  • Assurance that customer interests are represented in relevant forums.
  • Combating exploitation and unjust business practices.
  • To have consumer assurances assured.

Salient Features of Consumer Protection Act 2019

The new Consumer Protection Act has modified the meaning of “consumer”. According to the Act, a person who uses the services or purchases any good for personal use is referred to as a consumer. It’s important to note that a person is not regarded as a consumer if they purchase a good or use a service for resale or commercial purposes. This definition of the Consumer Protection Act 2019 includes offline and online transactions such as those made through teleshopping, direct sales, or multi-level marketing. Some salient features of the Consumer Protection Act 2019 are as follows:

Central Consumer Protection Authority (CCPA):

  • The Central Consumer Protection Authority (CCPA), which would serve as a regulatory body, is proposed to be established by the Consumer Protection Act 2019.
  • Consumer rights disputes involving unfair practices, false advertising, and violations of those rights will be governed by the CCPA, which will also defend, promote, and uphold such rights.
  • The wide-ranging authority would be granted to CCPA.
  • The CCPA will be able to take sub-divisional actions, recall items, order the price of goods or services to be reimbursed, revoke licenses, issue fines, and bring class-action lawsuits.
  • The CCPA will have a division dedicated to conducting independent investigations into infringements of consumer protection laws.

Consumer Disputes Redressal Commission:

  • The salient features of the Consumer Protection Act 2019 mandated that Consumer Disputes Redressal Commissions handle consumer complaints at the national, state, and district levels. As per the established rules, the State Commissions will provide the Central Government with information on vacancies, disposal, the status of cases, and other items, quarterly.

Under the Consumer Protection Act 2019, CDRCs accept the following types of complaints:

  • Excessive or misleading billing.
  • Unfair or limiting business tactics.
  • Sale of potentially life-threatening goods and services.
  • Sale of faulty products or services.
  • The Consumer Disputes Redressal Commission Rules state that lawsuits up to Rs. 5 lahks can be filed without paying fees.

Online Complain Submission:

  • Another important feature of the Consumer Protection Act 2019 is that it allows consumers to lodge complaints with the consumer forum that has jurisdiction over them and is situated near their residence or employment. This is in contrast to the previous requirement, which required the consumer to lodge a complaint at the store where the item was purchased or the address of the seller’s registered office.
  • Additionally, the new Consumer Protection Act includes provisions that allow consumers to submit complaints electronically and conduct hearings and/or examinations of parties through videoconferencing.
  • Additionally, consumers won’t need legal counsel to handle their complaints.

Disciplinary Actions & Product Liability:

  • The Consumer Protection Act 2019 introduced the concept of product liability. In the future, compensation for harm or loss brought on by subpar products or services will be the responsibility of the manufacturer, product service provider, or product seller.
  • The product seller, service provider, and manufacturer are all covered by this clause for any compensation claims. E-commerce platforms would also be considered product sellers.

Penalties for False Advertising:

  • The CCPA may fine a manufacturer or even an endorser for making a false or deceptive advertisement. Additionally, the Consumer Protection Act 2019 allows CCPA to imprison them.

Provision for Alternative Dispute Resolution:

  • As an alternative dispute resolution method, mediation is provided by the Consumer Protection Act 2019. There will be a stringent deadline established in the guidelines for mediation.
  • According to the recently unveiled regulations, a Consumer Commission will send a complaint for mediation whenever there is potential for an early resolution and the parties consent. The mediation will take place in one of the Mediation Cells that the Consumer Commissions will set up. There won’t be an appeal against the mediation-based settlement.

Unfair Business Practices:

  • The Consumer Protection Act has also empowered the government to take action against deceptive business practices.
  • The Act adopts a broad definition of unfair trade practices, which includes disclosing personally identifiable information provided by customers in trust unless required by any other legislation.

The Central Consumer Protection Council:

  • The Central Government is given the authority to create a Central Consumer Protection Council by the Consumer Protection Act 2019. It will serve as a consumer problems advisory council.
  • According to the Central Consumer Protection Council Rules, the Union Minister of Consumer Affairs, Food, and Public Distribution would serve as the Council’s chairman, with the Minister of State serving as vice chairperson and 34 other members representing various industries.
  • Two States from each of the five regions—North, South, East, West, and NER—will nominate a minister in charge of consumer affairs to the Council, which has a three-year term. Additionally, it is possible to form working groups among the members to complete particular tasks.

Applicability:

  • Unless a specific product or service is specifically excluded from its application by the Central Government, the Consumer Protection Act 2019 applies to all goods and services.

Consumer Protection Act 2019 – Product Liability Causes

A new addition to the Consumer Protection Act 2019 is product liability, which reflects norms from the modern world. The new act includes a whole chapter devoted to product responsibility. Consumers are protected from defective goods under this clause.

  • The COPRA 2019 act holds the manufacturer liable if a product does not meet specifications or is found to be defective. The Product Liability Clause also allows for liability for the service provider and the product vendor.
  • When a service is poor or flawed, the provider is held accountable. If no prior warnings, negligence, or injury occurred, the service provider would be held accountable under product responsibility.
  • A product seller is responsible if they exercise significant control over the product’s development, testing, packing, and labelling. Under the Consumer Protection Act 2019 provisions, they are also accountable if a product alteration causes harm to a consumer.
  • The product seller is responsible for lacking assembly, maintenance, and product inspection.

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