Legal Matters | Is the Consumer Protection Bill as good as it looks?

The Consumer Protection Bill, 2019, passed by Parliament on August 6, is a consumer’s dream come true. From the affirmation of consumer rights and checks on advertisers, to compensation for harm caused by manufacturing defects, there is much that is new and perhaps revolutionary.

Yet, as all dreams tend to be, this new law runs the risk of sounding much better than it actually is in practice.

First, let’s look at the positives. The incumbent legislation was, as its name suggested, a law to protect consumers. Interestingly, it never features the term ‘consumer rights’. The proposed law, on the other hand, defines consumer rights — such as the right to be informed of the quality, quantity, potency, purity, standard and price of products, and the right to be protected against the marketing of hazardous goods — and makes them justiciable.

Second, it creates a central authority to be known as the Central Consumer Protection Authority, charged with safeguarding the interest of the consumer, thus changing the nature of consumer protection from just giving the consumer a stick to beat the seller or service provider with, to handholding her for the purpose of enforcing her rights.

Third, it comes down heavily on false or misleading advertising, imposing strict penalties both on manufacturers or service providers, as the case may be, as well as on endorsers. Curiously, it does not mention celebrity endorsers — and could potentially harm low-paid actors merely acting in an advertisement.

Fourth, it allows parties to opt for mediation, which should help resolve at least some disputes sooner. It acknowledges the changed nature of selling, by bringing electronic commerce as well as alternate modes such as direct selling, within the letter of the law.

Fifth, and perhaps most importantly, it introduces the concept of Product Manufacturing Liability, wherein manufacturers, servicers, or sellers can become liable to consumers for any harm caused by a defective product.

Significantly, the Bill retains pretty much all the significant features of the existing law. One provision that is conspicuously absent according to detractors, is that healthcare is not included within the definition of service, as it was in an earlier version of the Bill (which lapsed before it became law). However, the 1986 definition also omits reference to ‘healthcare’, but medical negligence cases have been routinely agitated in consumer courts irrespective. Courts have been rightly deferential to healthcare workers, and except when faced with evidence of gross negligence, have protected the interest of doctors.

Now what could be the hitch? The reason why consumer law was becoming a blunt remedy was because of the inordinate delay in obtaining an award, and after that, in actually receiving the compensation, due to the acute shortage of judges.

Earlier this year, a legal-news portal published photos of files piled up in the corridors of the National Consumer Dispute Resolution Commission for lack of space within, showing how the institution is crumbling under its own weight. Often cases that cannot be heard on the given date, are adjourned by close to a year!

The proposed law seeks to address this by championing mediation, as well as by increasing the pecuniary jurisdiction of the consumer courts. That is, it increases the monetary value of cases which can be dealt with at lower fora — up to Rs 1 crore (up from Rs 20 lakh) at the district level, and up to Rs 10 crore (versus Rs 1 crore earlier) at the state level. That will mean that an overwhelming majority of complaints will have to be dealt with at the district level.

Therefore the effectiveness of the law will depend on the quality and integrity of the judges at these district forums. Sadly, the Bill makes no minimum qualification for judges at the district level, leaving it to the government to make rules for the same. Neither does it prescribe a minimum number of judges to be appointed. These could be fatal. An upper limit by which complaints as well as appeals should be disposed of by the consumer fora could have gone a long way in addressing delays.

The new law has many laudable features, but its success will depend on adequate judges of good quality. On that, however, the law is disconcertingly vague.

Source: Money Control