Consumer Dispute Resolution Through Mediation Under Consumer Protection Act, 2019
As you are aware that the Consumer Protection Act, 1986 is serving consumer fraternity since last three decades. This act has been promulgated to protect the interest of consumers from Unfair Trade Practices and fraudulent trade practices adopted by market players. The Act, 1986 is a three-tier redressal system having appellate jurisdictions. The last recourse is the Apex Court of India ,that is the Supreme Court. The provisions of Act, 1986 were enforced through established Consumer Redressal Forums. There are three types of Consumer Redressal Forums i.e., at district level, District Forum and State Level, State Forum and on National Level, there is National Consumer Disputes Redressal Forum (NCDRF). Their jurisdictions have been divided based on monetary and residential limit of the consumer. The Act,1986 has given wide definition of a “ Consumer” and a person falling in this definition is only allowed to file redressal application in this Act,1986.
The Consumer Protection Act, 2019 seeks to revamp the Consumer Protection Mechanism by repealing the Consumer Protection Act, 1986. A striking feature of the new Act relates to the establishment of “ Consumer Mediation Cells” for settlement of consumer disputes through settlement mechanism.
The consumer market for goods and services have undergone drastic transformation since the enactment of the Consumer Protection Act, 1986. A lot have been changed such as the way of marketing, the technology, the taste of consumers, the availability of products and services and of course the entry of “ E-Commerce Operators” in the world market. This emergence of global supply chain , raise in international trade and rapid development of e-commerce have led to new delivery systems for goods and services and have provided new options and opportunities for consumers. These developments have brought with then various types of unfair, unethical, fraudulent , misleading ,etc. business practices. The consumers are misleaded through improper advertisements, promotion of spurious and sub-standard quality of goods and services. These types of instances pose a threthe of good practices and lead to government to think to amend the existing Consumer Protection Law or to introduce new law considering all over factors and competing with the new technologies and new process of marketing.
In the view of above factors , it was proposed to repeal and re-enact the Consumer Protection Act, 1986.
The Consumer Protection Bill, 2019 was passed by Lok Sabha on 30th July 2019 and Rajya Sabha on 6th August,2019. On 9th August, 2019 the bill has received assent of Hon’ble President of India and thereafter notified as the Consumer Protection Act, 2019.
The Consumer Protection Act, 2019 consists of 107 Sections divided into 8 Chapters has repealed the old Consumer Protection Act, 1986.
While retaining certain old provisions, the New Act has certain new provisions that tightens the existing rules to further safeguard consumer rights and create exhaustive consumer protection law
i) New provisions under Consumer Protection Act 2019.
ii) Inclusion of E- commerce, Direct selling Establishment of Central Consumer Protection Authority (CCPA).
iii) Strict Norms for Misleading Advertisement.
iv) Strict Norms for product liability.
v) Changes in the Pecuniary Jurisdiction.
vi) Greater ease to dispute resolution Addition in the clause of “Unfair Trade Practice”:
vii) Unfair Contract .
viii) Alternate Dispute Resolution through mediation.
FAQ ON THE CONSUMER PROTECTION ACT, 2019
WHO IS A CONSUMER?
A person who buys any goods or services for a consideration, which has been paid or promised or partly paid and partly promised, or under any system of deferred payment also includes the user with approval of such goods or beneficiary of services.
As per Consumer Protection Act 2019, the expression “buys any goods” and ‘hires or avails any services” includes offline or online transactions through electronic means or by teleshopping or direct selling or multi-level marketing.
WHO IS A NOT A CONSUMER?
- A person who obtains.
- goods free of charge
- who avails services free of charge
- who obtains goods for resale or for any commercial purposes
- who avails services for any commercial purposes
- who avails services under contract of service
As per the provisions of the Act, commercial purpose does not include use by a person of goods bought and used by him exclusively for the purposes of earning his livelihood by means of self-employment.
WHAT CONSUMERS RIGHTS ARE GUARANTEED UNDER CONSUMER PROTECTION ACT, 2019?
Consumer is having the following six consumer rights under the Act
- Right to Safety
- Right to be Informed
- Right to Choose
- Right to be heard
- Right to seek Redressal
- Right to Consumer Awareness
CONSULER DISPUTES REDRESSAL COMMISSION;
The Act envisages a three-tier quasi-judicial machinery at the national, state and district level.
(i) National Consumer Disputes Redressal Commission(NCDRC)- Central Government is authorised to establish regional benches of NCDRC.
Pecuniary Limit: cases involving monitory value more than Rs. 10.00 Crores
(ii) State Consumer Disputes Redressal Commission(NCDRC)- State Government is authorised to establish regional benches of SCDRC.
Pecuniary Limit: cases involving monitory value more than Rs. 1.00 Crore but less Rs. 10.00 Crores.
(iii) District Consumer Disputes Redressal Commission(NCDRC)- State Government is authorised to establish one of more District Commission in each district.
Pecuniary Limit: cases involving monitory value of Rs. 1.00 Crore.
WHAT ARE GOODS?
“goods” means every kind of movable property and includes “food” as defined in clause (j) of sub-section (1) of section 3 of the Food Safety and Standards Act, 2006.
WHO CAN MAKE COMPLAINT?
i. a consumer; or
ii. any voluntary consumer association registered under any law for the time being in force; or
iii. the Central Government or any State Government; or
iv. the Central Authority; or
v. one or more consumers, where there are numerous consumers having the same interest; or
vi. in case of death of a consumer, his legal heir or legal representative; or
vii. in case of a consumer being a minor, his parent or legal guardian;\
Please Note That : A person buying goods or availing services for use in his/her business is not considered as a consumer under the Act,2019.
WHAT IS MEANT BY ‘DEFICIENCY’ UNDER THE ACT?
“Deficiency” means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service and includes—
i. any act of negligence or omission or commission by such person which causes loss or injury to the consumer; and
ii. deliberate withholding of relevant information by such person to the consumer.
WHAT IS AN UNFAIR CONTRACT?
“Unfair contract” means a contract between a manufacturer or trader or service provider on one hand, and a consumer on the other, having such terms which cause significant change in the rights of such consumer, including the following, namely: —
a. requiring manifestly excessive security deposits to be given by a consumer for the performance of contractual obligations; or
b. imposing any penalty on the consumer, for the breach of contract thereof which is wholly disproportionate to the loss occurred due to such breach to the other party to the contract; or
c. refusing to accept early repayment of debts on payment of applicable penalty; or
d. entitling a party to the contract to terminate such contract unilaterally, without reasonable cause; or
e. permitting or has the effect of permitting one party to assign the contract to the detriment of the other party who is a consumer, without his consent; or
f. imposing on the consumer any unreasonable charge, obligation or condition which puts such consumer to disadvantage
WHAT IS A MISLEADING ADVERTISEMENT?
Misleading advertisement” in relation to any product or service, means an advertisement, which—
a. falsely describes such product or service; or
b. gives a false guarantee to, or is likely to mislead the consumers as to the nature, substance, quantity or quality of such product or service; or
c. conveys an express or implied representation which, if made by the manufacturer or seller or service provider thereof, would constitute an unfair trade practice; or
d. deliberately conceals important information
WHO BE ALL CAN MADE LIABLE FOR A MISLEADING ADVERTISEMENT?
Manufacturers, advertising agencies, celebrity endorsers and publishers can be made liable.
WHAT IS E- COMMERCE?
E commerce under CP Act 2019 means buying or selling of goods or services Including digital products over digital or electronic network.
WHAT IS AN E COMMERCE ENTITY?
“e-commerce entity” means any person who owns, operates, or manages digital or electronic facility or platform for electronic commerce but does not include a seller offering his goods or services for sale on a marketplace e-commerce entity.
CENTRAL CONSUMER PROTECTION AUTHORITY ( New Concept)
The New Act provides power to Central Government to establish Central Consumer Protection Authority (CCPA) to regulate matters relating to violation of rights of Consumers, unfair trade practices and false or misleading advertisements which are prejudicial to the interests of public and Consumer and to promote, protect and enforce the rights of Consumer as a Class.
PLEASE NOTE THAT –
1. CCPA has an investigation wing headed by Director General having power to investigate in consumers matters.
2. The CCPA consists of Chief Commissioner and such other commissioners as may be prescribed by the Central Government.
3. The Central Authority shall protect, promote, and enforce the rights of the consumers as a class, and prevent violation of Consumers Rights under the Act.
4. the Central Authority may inquire or cause an inquiry or investigation to be made into violations of Consumer Rights, either Suo motu or on a complaint received or on the directions from the Central Government
5. the Central Authority can file complaints before the District Commission, the State Commission, or the National Commission as the case may be.
6. A person aggrieved by any order passed by the Central Authority may file an appeal to the National Commission within a period of thirty days from the date of receipt of such order.
WHO IS A PRODUCT SELLER?
“Product seller is a person who, in the course of business, imports, sells, distributes, leases, installs, prepares, packages, labels, markets, repairs, maintains, or otherwise is involved in placing such product for commercial purpose and includes—
i. a manufacturer who is also a product seller; or
ii. a service provider, but does not include—
a). a seller of immovable property unless such person is engaged in the sale of constructed house or in the construction of homes or flats.
b). a provider of professional services in any transaction in which, the sale or use of a product is only incidental thereto, but furnishing of opinion, skill or services being the essence of such transaction.
c). a person who—
I. acts only in a financial capacity with respect to the sale of the product.
II. is not a manufacturer, wholesaler, distributor, retailer, direct seller, or an electronic service provider.
III. leases a product, without having a reasonable opportunity to inspect and discover defects in the product, under a lease arrangement in which the selection, possession, maintenance, and operation of the product are controlled by a person other than the lessor.
WHAT IS PRODUCT LIABILITY? It means the responsibility of a product manufacturer or product seller, of any product or service, to compensate for any harm caused to a consumer by such defective product manufactured or sold or by deficiency in services relating thereto.
WHAT IS “PRODUCT LIABILITY ACTION”? It means a complaint filed by a person before a District Commission or State Commission or National Commission, as the case may be, for claiming compensation for the harm caused to him.
WHAT IS MEANT BY ‘HARM’? “harm”, in relation to a product liability includes—
i. damage to any property, other than the product itself.
ii. personal injury, illness, or death.
iii. mental agony or emotional distress attendant to personal injury or illness or damage to property; or
iv. any loss of consortium or services or other loss resulting from a harm referred to in sub-clause (i) or sub-clause (ii) or sub-clause (iii) but shall not include any harm caused to a product itself or any damage to the property on account of breach of warranty conditions or any commercial or economic loss, including any direct, incidental, or consequential loss relating thereto.
CAN I CLAIM COMPENSATION IF THE PRODUCT ITSELF IS DAMAGED?
No, damage of the product itself cannot be the base for product liability compensation.
WHO ALL CAN BE LIABLE IN A PRODUCT LIABILITY ACTION?
Manufacturer or a product service provider or a product seller,
WHAT GROUNDS CAN I CLAIM COMPENSATION PRODUCT MANUFACTURER?
1. A product manufacturer shall be liable in a product liability action, if—
a. the product contains a manufacturing defect; or
b. the product is defective in design; or
c. there is a deviation from manufacturing specifications; or
d. the product does not conform to the express warranty; or
e. the product fails to contain adequate instructions of correct usage to prevent any harm or any warning regarding improper or incorrect usage.
2. A product manufacturer shall be liable in a product liability action even proves that he was not negligent or fraudulent in making the express warranty of a product.
WHEN CAN I CLAIM COMPENSATION FROM PRODUCT SERVICE PROVIDER?
A product service provider shall be liable in a product liability action, if—
a. the service provided by him was faulty or imperfect or deficient or inadequate in quality, nature or manner of performance which is required to be provided by or under any law for the time being in force, or pursuant to any contract or otherwise; or
b. there was an act of omission or commission or negligence or conscious withholding any information which caused harm; or
c. the service provider did not issue adequate instructions or warnings to prevent any
harm; or
d. the service did not conform to express warranty or the terms and conditions of the contract.
WHEN CAN I CLAIM COMPENSATION FROM SELLER?
A product seller who is not a product manufacturer shall be liable in a product liability action,
- if he has exercised substantial control over the designing, testing, manufacturing, packaging or labelling of a product that caused harm; or
- he has altered or modified the product and such alteration or modification was the substantial factor in causing the harm; or
- he has made an express warranty of a product independent of any express warranty made by a manufacturer and such product failed to conform to the express warranty made by the product seller which caused the harm; or
- the product has been sold by him and the identity of product manufacturer of such product is not known, or if known, the service of notice or process or warrant cannot be effected on him or
- he is not subject to the law, which is in force in India or the order, if any, passed or to be passed cannot be enforced against him; or
- he failed to exercise reasonable care in assembling, inspecting, or maintaining such product or he did not pass on the warnings or instructions of the product manufacturer regarding the dangers involved or proper usage of the product while selling such product and such failure were the proximate cause of the harm.
WHAT IS THE DEFENCE AVAILABLE IN A PRODUCT LIABILITY ACTION?
- The product was misused, altered, or modified.
- A danger which is obvious or commonly known to the user or consumer of such product or which, such user or consumer, ought to have known, taking into account the characteristics of such product.
- The product was purchased, and the product manufacturer had provided warnings or instructions to such employer.
- The product was sold as a component of an end product and necessary warnings or instructions were given by the product manufacturer, but the harm was caused to the complainant by use of the end product in which such component or material was used.
- The product was legally meant to be used or dispensed only by or under the supervision of an expert and the product manufacturer had employed reasonable means to give the warnings or instructions for usage of such product to such expert or class of experts; or
- The complainant, while using such product, was under the influence of alcohol or any prescription drug which had not been prescribed by a medical practitioner
WHAT IS THE PROCEDURE FOR FILING THE COMPLAINT BEFORE CONSUMER COMMISSION?
A complaint:
- Should be in writing
- Can be filed in a regular way (offline)
- Can be filed online – http://edaakhil.nic.in/
A complaint can be presented by the complainant in person or by his agent. It can even be sent by registered post along with the court fee.
Normally three copies of the complaint are required to be submitted out of which one retained for the official purpose, one is forwarded to the opposite party, and one is the for the complainant. In case the number of opposite parties is more correspondingly more copies of the complaint are required.
CAN A CONSUMER COMPLAINT BE RESOLVED THROUGH MEDIATION?
Yes. Either at the first hearing after admission, or at later stage if the District Commission is of the view that, there exists an element of settlement, can refer the complaint to Mediation with the consent of the parties.
Also, parties at any stage of the complaint can opt for settlement through mediation.
CAN APPEAL BE FILED AFTER SETTLEMENT THROUGH MEDIATION?
No appeal lies after the settlement of dispute through mediation.
DOES CONSUMER NEED AN ADVOCATE TO REPRESENT HIS CASE IN THE COMMISSION?
Consumer Commissions are quasi-judicial bodies to provide simple and speedy justice. These have been kept free from the complicated judicial procedures. The manner is quite informal and free from the shackles of the Civil Court. There is no need for an advocate, or any other pleader and consumer can himself or through his representative file and represent his complaint.
Please Note That: it depends on the parties to the dispute ,whether they wants to appear with through their advocates or not.
WHAT PARTICULARS SHOULD BE FURNISHED IN THE COMPLAINT?
- Name, description, and address of the complainant.
- Name, description and address of the opposite party or parties.
- Facts relating the complaint and when and where it arose.
- Documents, if any in support of allegations
WHAT IS THE TIME LIMIT FOR FILING THE COMPLAINT?
The complaint shall be filed within two years from the date on which the cause of action has arisen. This would mean two years from the day the deficiency in service or defect in goods has arisen/detected. This is also known as the limitation period for filing the complaint.
HOW TO MAKE THE PAYMENT OF THE COURT FEE?
Every complaint filed before District Commission/ State Commission/ National Commission shall be accompanied by a fee as specified, in the form of crossed Demand Draft drawn on a nationalized bank or through a crossed Indian Postal Order drawn in favour of the Registrar of the State Commission and payable at the respective place where the State Commission or the National Commission is situated. The concerned District Commission shall deposit the amount so received.
WHAT RELIEFS ARE PROVIDED BY CONSUMER COMMISSIONS?
i. Removal of defects from the goods.
ii. Replacement of the goods.
iii. Refund of the price paid.
iv. Removal of defects or deficiencies in the services.
v. Award of compensation for the loss or injury suffered.
vi. Discontinue and not to repeat unfair trade practice or restrictive trade practice.
vii. To withdraw hazardous goods from being offered for sale.
viii. To cease manufacture of hazardous goods and desist from offering services which are hazardous in nature.
ix. If the loss or injury has been suffered by a large number of consumers who are not identifiable conveniently, to pay such sum (not less than 25% of the value of such defective goods or services provided) which shall be determined by the Commission.
x. To issue corrective advertisement to neutralize the effect of misleading advertisement.
xi. To provide adequate costs to parties.
WHAT IF THE CONSUMER IS NOT SATISFIED WITH THE ORDER OF THE CONSUMER COMMISSION?
Any consumer who is aggrieved by the order of a commission can prefer an appeal in the higher commission within a period of thirty days from the date of the order. The appeal can be preferred
- against order of the District Commission before the State Commission-( Within 30 days)
- against order of the State Commission before the National Commission-( Within 30 days)
- against order of the National Commission before the Supreme Court-( Within 45 days)
IS THERE ANY FEE FOR FILING A COMPLAINT WITH THE COMMISSIONS?
Every complaint filed shall be accompanied by a fee, as may be specified , in the form of crossed Demand Draft drawn on a nationalized bank or through a crossed Indian Postal Order in favour of the President of the District Commission or the Registrar of the State Commission or the Registrar of the National Commission, and payable at the respective place where the District Commission, State Commission or the National Commission is situated, or through electronic mode as per arrangement made by the Commission concerned.
PLEASE NOTE THAT – for appeal before NCDRC or Supreme Court , you have to deposit 50% of amount awarded by the SCDRC or NCDRC before the appellate commission or Supreme Court.
LET’S BACK ON OUR MAIN ISSUE THAT IS REDRESSAL OF DISPUTES THROUGH MEDIATION
WHAT IS MEDIATION?
The term mediation can be defined as a voluntary dispute resolution process where the third party facilitates negotiation between the disputed parties to negotiate for their rights and interests by themselves. The third party who facilitates the negotiation between the disputed parties is called mediator.
As described by the Mediation and Conciliation Project Committee of Supreme Court of India, ‘Mediation’ is a voluntary, binding process in which an impartial and neutral mediator facilitates disputing parties in reaching a settlement. A mediator does not impose a solution but creates a conducive environment in which disputing parties can resolve all their disputes.
Mediation is tried and tested alternative method of dispute resolution.
AT WHICH STAGES OF A DISPUTE CONSUMER COMMISSION CAN REFER CASE FOR MEDIATION?
A Consumer Commission may refer a consumer dispute for mediation at the first hearing of the complaint after its admission, or at any later stage, if it appears to the Consumer Commission that there exist any elements of a settlement which may be acceptable to the parties. [Section 37(1) of CPA, 2019].
WHAT TYPES OF CONSUMER DISPUTES ARE APPROPRIATE TO SETTLE THROUGH MEDIATION?
All the consumer disputes can be referred for mediation, except the following matters:
a) The matters relating to proceedings in respect of medical negligence resulting in grievous injury or death.
b) Matters which relate to defaults or offences for which applications for compounding of offences have been made by one or more parties.
c) Cases involving serious and specific allegations of fraud, fabrication of documents, forgery, impersonation, coercion.
d) Cases relating to prosecution for criminal and non-compoundable offences.
e) Cases which involve public interest or the interest of numerous persons who are not parties before the Commission.
Provided that, in any case other than those mentioned in this rule, the Commission before which the case is pending may choose not to refer it to mediation if it appears to the Commission that no elements of a settlement exist which may be acceptable to the parties or that mediation is otherwise not appropriate having regard to the circumstances of the case and the respective positions of the parties. [Rule 4 of Consumer Protection (Mediation) Rules, 2020.]
HOW A REFERENCE FOR MEDIATION IN CONSUMER DISPUTES IS MADE?
If it appears to the DCDRC/SCDRC/NCDRC as the case may be, that there exist elements of settlement which may be acceptable to the parties, it may direct the parties to give in writing, within five days, consent to have their dispute settled by mediation.
Where the parties agree for settlement by mediation and give their consent in writing, the District Commission shall, within five days of receipt of such consent, refer the matter for mediation.
CAN THE PARTIES OF THE CONSUMER DISPUTE MAKE AN APPLICATION FOR MEDIATION?
In a consumer dispute, parties are not barred by the law for filing an application requesting reference of their dispute to the mediation.
On such application by any/all of the parties, consented by all the parties, the District Commission may consider referring the matter for mediation as provided in Section 37(2) of CPA, 2019.
TYPES OF MEDIATION
1. COURT- REFERRED MEDIATION
Court referred mediation is one where a case has been filed before the Court and Court refers such matter for mediation under Sec. 89 of the Code of Civil Procedure, 1908. Court referred mediation is post litigation mediation. As in case of Consumer protection Act 2019, wherein Section 37, 49 & 59 empowers the Consumer Commissions to refer the Cases to the Mediation Cell Attached to it.
2. PRIVATE MEDIATION
The private mediation is one where qualified mediator offer the services of mediation on a private, fee-for-service basis to the Court, to members of the public, to members of the commercial sector and also to the governmental sector to resolve disputes through mediation. Private mediation can be used in connection with disputes pending in Court and pre-litigation disputes.
CONSUMER MEDIATION CELLS: Chapter V of the Act, 2019 has introduced the provision of mediation as an Alternate Resolution Mechanism. The said Chapter V contains various provisions relating to the establishment and working of Consumer Mediation Cells.
Please Note That- these Mediation Cells are attached to each tier of Consumer Redressal Commission such as.
1. On District Level- District Consumer Mediation Cell.
2. On State Level- State Consumer Mediation Cell.
3. On National Level- National Consumer Mediation Cell.
Please Note That- these mediation cells do not have appellate jurisdictions and on each stage the decision of Consumer Mediation Cells is final, and you are not allowed to raise any dispute against order passed by Mediation Cells. Their order will be considered as final and same will be followed by both complainant and the respondent.
REPORTS AND RECORD MAINTENANCE. Every consumer mediation cell shall maintain.
i) A list of empanelled mediators.
ii) A list of cases handled by the cell.
iii) Record of proceedings; and
iv) Such other information and records as may be prescribed by the regulations to be framed by NCDRC.
v) The Consumer Mediation cells are also required to submit a quarterly report to the commission to which it attached. The manner and contains of the report to be submitted should be as per[ Consumer Protection (Mediation) Rules, 2020] framed by the NCDRC.
EMPANELMENT OF MEDIATORS; for the purpose of mediation , every commission shall prepare a panel of the mediators to be maintained by the Consumer Mediation Cell attached to it. A selection committee consisting of president and member of the Commission shall recommend the names for the panel. The panel of mediators shall be valid for a period of five years. An empanelled mediator shall be eligible to be considered for re-empanelment for another term, if he satisfied the conditions which may be specified by the NCDRC [ Consumer Protection (Mediation) Rules, 2020]. The NCDRC shall also frame the regulations of appointment of mediators and terms of their office.
NOMINATION OF MEDIATORS; The Commission shall, while nominating any such person from the panel, consider his suitability for resolving the dispute involved. The mediator may be changed on satisfaction of the commission in case of any conflict of interest or adverse relating to mediators from trusted source. The nomination should be made according to [ Consumer Protection (Mediation) Rules, 2020].
DUTY OF MEDIATOR TO DISCLOSE: it shall be the duty of a mediator to disclose.
i) Any personal ,professional or financial interest in the outcome of the consumer dispute; and
ii) The circumstances which may give rise to a justifiable doubt as to his independence or impartibility.
The NCDRC has framed [ Consumer Protection (Mediation) Rules, 2020].
PROCEDURE TO MEDIATION:
Following are the functional stages of the mediation process:
1) INTRODUCTION AND OPENING STATEMENT During this stage the Mediator establishes neutrality by disclosing everything about him. He creates an awareness and understanding of the process in the minds of the parties. He develops rapport with the parties to gain confidence and trust. He tries to create a healthy environment that is conducive to constructive negotiations. Further, he motivates the parties for an amicable settlement of the dispute.
2) JOINT SESSION This session is meant for common hearing of all the parties of the dispute. In this stage the mediator gathers information, provides an opportunity to the parties to hear the perspectives of the other parties. The mediator tries to understand perspectives, relationships, and feelings of the parties to the dispute. Further this session is used to understand facts, the issues, obstacles, and possibilities of settlement. Joint session ensures that each participant is being heard.
3) SEPARATE SESSION(S) This is a session to understand the dispute at a deeper level and the underlying interests of the parties. It provides a forum for parties to further vent their emotions and to disclose confidential information which they do not wish to share with other parties. Being a private session, it helps parties to realistically understand the case. Mediator can bring the parties to a solution-finding mood and encourage parties to generate options and find terms that are mutually acceptable.
4) CLOSING This is concluding stage of mediation. When the parties come up with the terms of settlement, the mediator orally confirms the terms of settlement and reduced such terms in writing in a document called settlement agreement which will be signed by all parties to the dispute. Mediator also may affix his signature on the signed agreement, certifying that the agreement was signed in his/her presence. A copy of the signed agreement is furnished to the parties. The original signed agreement sent to the referral body for passing appropriate order in accordance with the agreement.
If a settlement between the parties could not be reached, the case would be returned to the referral body merely reporting “not settled”. The report will not assign any reason for non-settlement or fix responsibility on any one for the non-settlement.
PLEASE NOTE THAT :
i) Information shared in mediation proceedings cannot be shared for any purposes except for the mediation of the dispute for which it is shared. The parties and the mediator shall maintain confidentiality in respect of the events that transpire during the mediation proceedings and shall not use or rely upon any information, document etc. produced, the proposals and admissions made, or the views expressed during the mediation proceedings. There shall be no audio or video recording of the mediation proceedings.
ii) The parties shall be entitled to appear before the mediator in person or through their respective counsel or authorised representatives.
iii) The time period provided for mediation is three months. The mediation shall stand terminated on expiry of three months from the date of first appearance before the mediator unless the time for completion of mediation is extended by the Consumer Commission, in which case it shall stand terminated on expiry of such extended time.
iv) The Concerned Commission on failure of settlement by mediation will proceed to hear such complaint.
v) The parties of the mediation proceedings shall not use or rely upon any information, document etc. produced, the proposals and admissions made, or the views expressed during the mediation proceedings.
vi) The fee of the mediator shall be shared equally by the two sets of parties.
vii) The mediator shall not communicate with the Consumer Commission except by way of his report, with copies to all the parties.[Regulation 14 of Consumer Protection (Mediation) Regulations, 2020.]
viii) If a party does not participate in the mediation proceedings, the Consumer Commission may direct such a party to participate in the proceedings. [Regulation 11(5) of the Consumer Protection (Mediation) Regulations, 2020.]
IS THERE ANY PROCEDURAL CODE PRESCRIBED UNDER LAW FOR MEDIATION?
The mediator shall be guided by the principles of natural justice and fair play but shall not be bound by the provisions of the Code of Civil Procedure, 1908 (5 of 1908) or the Indian Evidence Act, 1872 (1 of 1872). [Regulation 11(4) of Consumer Protection (Mediation)Regulations, 2020.]
PROVISIONS APPLICABLE ON SETTLEMENT UNDER CONSUMER LAW:
SETTLEMENT “Settlement” means a settlement arrived at in the course of mediation.
[Rule 2 (f) of Consumer Protection (Mediation) Rules, 2020.]
AGREEMENT ON DISPUTES SHALL BE REDUCED TO WRITING Pursuant to mediation, if an agreement is reached between the parties with respect to all of the issues involved in the consumer dispute or with respect to only some of the issues, the terms of such agreement shall be reduced to writing accordingly and signed by the parties to such dispute or their authorised representatives. [Section 80(1) of CPA, 2019]
AGREEMENT ALONG WITH THE SETTLEMENT REPORT SHALL BE FORWARDED TO THE CONCERNED COMMISSION.
The mediator shall prepare a settlement report of the settlement and forward the signed agreement along with such report to the concerned Commission.
Where no agreement is reached between the parties within the specified time or the mediator is of the opinion that settlement is not possible, he shall prepare his report accordingly and submit the same to the concerned Commission. [Section 80(2) of CPA, 2019]
CONCERNED COMMISSION SHALL PASS SUITABLE ORDERS The District Commission or the State Commission or the National Commission, as the case may be, shall, within seven days of the receipt of the settlement report, pass suitable order recording such settlement of consumer dispute and dispose of the matter accordingly. [Section 81(1)]
ENFORCEMENT OF ‘SETTLEMENT’ REACHED BETWEEN PARTIES Every order made by a District Commission, State Commission or the National Commission shall be enforced by it in the same manner as if it were a decree made by a Court in a suit before it and the provisions of Order XXI of the First Schedule to the Code of Civil Procedure, 1908 shall, as far as may be, applicable, subject to the modification that every reference therein to the decree shall be construed as reference to the order made under this Act. [Section 71 of CPA, 2019]
WHETHER THE APPLICATION FEE PAID IN A CONSUMER COMMISSION IS REFUNDABLE ON SETTLEMENT THROUGH MEDIATION?
Refund of fee.—Where the Commission refers the parties to mediation, the complainant shall be entitled to receive full amount of application fee paid in respect of such complaint, if a settlement is reached between such parties. [Rule 5 of Consumer Protection (Mediation) Rules, 2020].
PLEASE NOTE THAT : The parties shall not initiate any arbitral or judicial proceedings in respect of a matter which is the subject-matter of the mediation and also when such parties have expressly undertaken not to initiate any such proceeding. [Rule 6 of Consumer Protection (Mediation) Rules, 2020.]
WHAT HAPPENS IF MEDIATION FAILS?
The Concerned Commission on failure of settlement by mediation will proceed to hear such complaint. [Section 38 (1), Section 49, Section 59 of CPA, 2019].
IN CASE OF FAILURE OF MEDIATION, WILL THE STAND TAKEN BY THE PARTY/PARTIES BE DISCLOSED TO THE RESPECTIVE COMMISSION?
If no agreement is executed between the parties, within the time prescribed in these regulations, the mediator shall intimate so, to the Consumer Commission, without in any manner disclosing as to what transpired during the mediation proceedings, what was the stand taken by the parties or why the agreement could not be reached. [Regulation 11(9) of the Consumer Protection (Mediation)Regulations, 2020.]
CONSLUSION: the Consumer Protection Act, 2019 has brought a paradigm change in the way of handling consumer complaints and it is a social act, enacted for the welfare of consumer ferity at large. The Act,2019 provides Alternate Redressal Mechanism along with redressal process through three tier Consumer Disputes Redressal Forums. These DCDRC/SCDRC/NCDRC Forums consist with them Consumer Mediation Commissions Cells , through which cost effective and timely resolution can be obtained. The Act, 2019 has also introduced the Central Consumer Protection Authority ,headed by Director General , who is empowered to received complaints and investigate in required cases. The pecuniary jurisdiction of DCDRC/SCDRC/NCDRC Forums has been increased and online filing of applications are allowed by the Act,2019. The Act,2019 has also imposed heavy fine and imprisonment in case of product liabilities on celebrities and the manufacturer endorsing and producing those products. Now the moral liability of celebrities has been fixed to check the quality and the standard of the products they are endorsing. Overall, this is a good step taken by the government to change the old Act,1986 and to bring the new Act,2019 to cope with challenges of development in technology and emergence of e-commerce platforms for marketing.
DISCLAIMER: the article produces above is only for information and knowledge of the readers. The article has been prepared on the basis of available information and materials at the time of preparation of various forums. The views expressed here are the personal views of the author and same should not be considered as professional advice. In case of necessity do consult with professional for more clarify and understanding on subject matter.
FOOTNOTES:
1. Handbook of Ministry of Consumer Affairs , New Delhi.
Author Bio
dear writer
Please advise me as to the remuneration aspect of Mediator
dr vedula gopinath vgnath@gmail.com