Detailed Analysis of The Consumer Protection Act, 2019

The Consumer Protection Act, 2019 (New Act)

Notification No. S.O. 2351(E) dated 15th July 2020 

The Consumer Protection Act, 2019 (‘New Act’) received the assent of the President of India and was published in the official gazette on 9th August 2019. This New Act will replace the old Consumer Protection Act, 1986 (‘Old Act’). The New Act will come into force on such date as the Central Government may so notify.

The New Act is an Act to provide for protection of the interests of consumers and for the said purpose, to establish authorities for timely and effective administration and settlement of consumers’ disputes and for matters connected therewith or incidental thereto. The New Act aims at strengthening consumer rights and protecting consumer interests, and further lays down simpler procedures to give consumers a speedy redressal. The Act also brings under its jurisdiction, the e- commerce and the tele-shopping industry.

Save as otherwise expressly provided by the Central Government, by notification, the New Act shall apply to all goods and services.

Now, recently, in exercise of the powers conferred by sub-section (3) of section 1 of the New Act, MINISTRY OF CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION (Department of Consumer Affairs) has issued a Notification No. S.O. 2351(E) dated 15th July 2020 (‘the Said Notification’) whereby the Central Government has appointed the 20th day of July, 2020 as the date on which the following provisions of the said Act shall come into force, namely:-

Chapter IV [Sections 28 to 73 (both inclusive); Except sub-clause (iv) of clause (a) of sub-section (1) of section 58.] has been notified by the said Notification.

Chapter IV deals with ‘Consumer Dispute Redressal Commission’.

Now, we would like to try and deal herein only Chapter IV of the New Act. The rest of the provisions of the New Act may come in our next session.

Section 9 of the Old Act established three different authorities at three different levels to regulate and resolve matters related to consumers namely:

• National Consumer Dispute Redressal Commission to be known as ‘National Commission’.
• State Consumer Dispute Redressal Commission to be known as ‘State Commission’.
• District Consumer Dispute Redressal Commission to be known as ‘District Forum’.

Now under New Act, the District Forum is renamed as ‘District Commission’. 

PECUNIARY LIMIT UNDER NEW ACT AND OLD ACT: – 

‘DISTRICT COMMISSION’: Subject to the other provisions of this Act, the District Commission shall have jurisdiction to entertain complaints where the value of the goods or services paid as consideration does not exceed one crore rupees [Section 34 of the New Act].

Whereas, subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed does not exceed rupees twenty lakhs [Section 11 of the old Act].  

‘STATE COMMISSION’: Subject to the other provisions of this Act, the State Commission shall have jurisdiction to entertain complaints where the value of the goods or services paid as consideration, exceeds rupees one crore, but does not exceed rupees ten crore [Section 47(1) of the New Act].

Whereas, subject to the other provisions of this Act, the State Commission shall have jurisdiction to entertain complaints where the value of the goods or services and compensation, if any, claimed, exceeds rupees twenty lakhs, but does not exceed rupees one crore [Section 17(1) of the Old Act]. 

‘NATIONAL COMMISSION’: Subject to the other provisions of this Act, the National Commission shall have jurisdiction to entertain complaints where the value of the goods or services paid as consideration, exceeds rupees ten crore [Section 58(1) of the New Act].

Whereas, subject to the other provisions of this Act, the National Commission shall have jurisdiction to entertain complaints where the value of the goods or services and compensation, if any, claimed, exceeds rupees one crore [Section 21 of the Old Act].

THE LIMITATION PERIOD FOR FILING OF APPEAL TO STATE COMMISSION IS INCREASED FROM 30 DAYS TO 45 DAYS.

Any person aggrieved by an order made by the District Commission may prefer an appeal against such order to the State Commission on the grounds of facts or law within a period of forty-five days from the date of the order, in such form and manner, as may be prescribed [Section 41 of the New Act] 

Whereas, pursuant to the provisions of Section 15 of the Old Act, any person aggrieved by an order made by the District Forum may prefer an appeal against such order to the State Commission within a period of thirty days from the date of the order, in such form and manner as may be prescribed. 

CHANGE IN DEPOSIT AMOUNT TO FILE AN APPEAL BEFORE STATE COMMISSION. 

The Opposite Party needs to deposit 50% of the amount ordered by District Commission before filing appeal before State Commission, earlier the ceiling was of maximum of Rs. 25,000/-, which has been removed. 

Second Proviso to Section 41 (1) of the New Act provides that no appeal by a person, who is required to pay any amount in terms of an order of the District Commission, shall be entertained by the State Commission unless the appellant has deposited fifty per cent of that amount in the manner as may be prescribed.

Whereas, Second Proviso to Section 15 of the Old Act provides that no appeal by a person, who is required to pay any amount in terms of an order of the District Forum, shall be entertained by the State Commission unless the appellant has deposited in the prescribed manner fifty per cent. of that amount or twenty-five thousand rupees, whichever is less. 

CHANGE IN DEPOSIT AMOUNT TO FILE AN APPEAL BEFORE NATIONAL COMMISSION. 

The Opposite Party needs to deposit 50% of the amount ordered by State Commission before filing appeal before National Commission, earlier the ceiling was of maximum of Rs. 35,000/, which has been removed.

Second Proviso to Section 51 (1) of the New Act provides that no appeal by a person, who is required to pay any amount in terms of an order of the State Commission, shall be entertained by the National Commission unless the appellant has deposited fifty per cent of that amount in the manner as may be prescribed.

Whereas, Second Proviso to Section 19 of the Old Act provides that no appeal by a person, who is required to pay any amount in terms of an order of the State Commission, shall be entertained by the National Commission unless the appellant has deposited in the prescribed manner fifty per cent. of the amount or rupees thirty-five thousand, whichever is less. 

CHANGE IN DEPOSIT AMOUNT TO FILE AN APPEAL BEFORE HON’BLE SUPREME COURT. 

The Opposite Party needs to deposit 50% of the amount ordered by National Commission before filing appeal before Hon’ble Supreme Court, earlier the ceiling was of maximum of Rs. 50,000/-, which has been removed. 

Second Proviso to Section 67 of the New Act provides that no appeal by a person who is required to pay any amount in terms of an order of the National Commission shall be entertained by the Supreme Court unless that person has deposited fifty per cent. of that amount in the manner as may be prescribed.

Whereas, Second Proviso to Section 23 of the Old Act provides that no appeal by a person who is required to pay any amount in terms of an order of the National Commission shall be entertained by the Supreme Court unless that person has deposited in the prescribed manner fifty per cent. of that amount or rupees fifty thousand, whichever is less.

APPEAL TO NATIONAL COMMISSION ONLY WHEN THERE IS A SUBSTANTIAL QUESTION OF LAW IS INVOLVED IN THE MATTER.  

Section of 51(2) of the New Act provides that Save as otherwise expressly provided under this Act or by any other law for the time being in force, an appeal shall lie to the National Commission from any order passed in appeal by any State Commission, if the National Commission is satisfied that the case involves a substantial question of law.

Whereas, it is pertinent to note that this provision was not contained in the Old Act.

POWER TO DECLARE ANY TERMS OF CONTRACT AS NULL AND VOID. 

Section 49(2) and 59(2) of the New Act gives power to the State Commission and National Commission respectively to declare any terms of contract, which is unfair to any consumer, to be null and void. 

Whereas it is pertinent to note that this provision was not contained in the Old Act. 

POWER OF REVISION. 

Power of revision can still be exercised by National Commission under Section 58(1)(b) of the New Act and by State commission under section 47(1)(b) of the New Act.

Subject to the other provisions of this Act, the State Commission shall have jurisdiction to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any District Commission within the State, where it appears to the State Commission that such District Commission has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested or has acted in exercise of its jurisdiction illegally or with material irregularity. [Section 47(1)(b) of the New Act].

Subject to the other provisions of this Act, the National Commission shall have jurisdiction to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any State Commission where it appears to the National Commission that such State Commission has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested, or has acted in the exercise of its jurisdiction illegally or with material irregularity [Section 58(1)(b) of the New Act]. 

Whereas it is pertinent to note that this provision was not contained in the Old Act. 

POWER OF REVIEW. 

Power of review has been conferred to District Commission, State Commission and National Commission under section 40, 50 and 60 of the New Act respectively

The District Commission shall have the power to review any of the order passed by it if there is an error apparent on the face of the record, either of its own motion or on an application made by any of the parties within thirty days of such order [Section 40 of the New Act].

The State Commission shall have the power to review any of the order passed by it if there is an error apparent on the face of the record, either of its own motion or on an application made by any of the parties within thirty days of such order [Section 50 of the New Act].

The National Commission shall have the power to review any of the order passed by it if there is an error apparent on the face of the record, either of its own motion or on an application made by any of the parties within thirty days of such order [Section 60 of the New Act]. 

Whereas, in the Old Act power of review was given only to National Commission. Pursuant to Section 22 of the Old Act the National Commission shall have the power to review any order made by it, when there is an error apparent on the face of record.

ENFORCEMENT OF ORDERS OF DISTRICT COMMISSION, STATE COMMISSION AND NATIONAL COMMISSION. 

Section 71 of the New Act confers power of execution as provided Under Order XXI, The Code of Civil Procedure, 1908 with such limitation as provided in the section.

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 the New Act].

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Disclaimer: Nothing contained in this document is to be construed as a legal opinion or view of either of the authors whatsoever and the content is to be used strictly for educative purposes only.