Lok Sabha passes Consumer Protection Bill, minister says 1986 law needs change

The Lok Sabha on Thursday passed the Consumer Protection Bill, 2018, amid protests by Congress and Telugu Desam Party (TDP) members.

The Bill will now go to Rajya Sabha for consideration and passage. Once adopted, it will replace the Consumer Protection Act, 1986.

Highlights of the Bill  

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

Consumer Disputes Redressal Commissions will be set up at the District, State and National levels for adjudicating consumer complaints.  Appeals from the District and State Commissions will be heard at the next level and from the National Commission by the Supreme Court.

The Bill sets up a Central Consumer Protection Authority to promote, protect and enforce consumer rights as a class.  It can issue safety notices for goods and services, order refunds, recall goods and rule against misleading advertisements.

If a consumer suffers an injury from a defect in a good or a deficiency in service, he may file a claim of product liability against the manufacturer, the seller, or the service provider.

The Bill defines contracts as ‘unfair’ if they significantly affect the rights of consumers.  It also defines unfair and restrictive trade practices.

The Bill establishes Consumer Protection Councils at the district, state and national levels to render advice on consumer protection.

Key Issues and Analysis

The Bill sets up the Consumer Disputes Redressal Commissions as quasi-judicial bodies to adjudicate disputes.  The Bill empowers the central government to appoint members to these Commissions.  The Bill does not specify that the Commissions will comprise a judicial member.  If the Commissions were to have members only from the executive, the principle of separation of powers may be violated.

The Bill empowers the central government to appoint, remove and prescribe conditions of service for members of the District, State and National Consumer Disputes Redressal Commissions.  The Bill leaves the composition of the Commissions to the central government.  This could affect the independence of these quasi-judicial bodies.

Consumer Protection Councils will be set up at the district, state, and national level, as advisory bodies.  The State and National Councils are headed by Ministers in-charge of Consumer Affairs.  The Bill does not specify whom the Councils will advise.  If the Councils advise the government, it is unclear in what capacity such advice will be given.

Other Bodies established under the Bill:

Central Consumer Protection Authority: The Bill sets up the Central Consumer Protection Authority (CCPA) to promote, protect, and enforce the rights of consumers as a class.  It will be headed by a Chief Commissioner and comprise other Commissioners.  It will have an investigation arm headed by a Director General.  It may: (i) issue safety notices; (ii) pass orders to recall goods, prevent unfair and restrictive trade practices; (iii) reimburse purchase price paid; and (iv) impose penalties for false and misleading advertisements.  It may also file complaints before the Consumer Disputes Redressal Commissions.

Consumer Protection Councils: The Bill sets up Consumer Protection Councils (CPCs) at the district, state, and national levels as advisory bodies.  The Councils will advise on promotion and protection of consumer rights.  Under the Bill, the Central and State Council will be headed by the Minister-in-charge of Consumer Affairs at the central and state level, respectively.  The District Council will be headed by the District Collector.

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