New Consumer Protection Bill 2019: How to seek compensation

New Delhi, August 8: The parliament has passed the Consumer Protection Bill 2019, which seeks to give enhanced protection to interests of consumers and timely settlement of their grievances.

The new bill has better protection for the consumers and has stiff penalties for manufacturers and for the first time celebrities endorsing a false or misleading advertisement will have to shell out penalties.

The benefits consumers gain from the Consumer Protection Bill 2019:

Right to seek compensation under product liability

The clause relating to product liability holds the manufacturer, service provider or seller responsible for any harm or injury suffered by a consumer due to a defective product or deficient service. In order to claim compensation, a consumer needs to file a complaint where in he will have to prove any one of the conditions for defect or deficiency, as provisioned in the Bill.

Class Action

The Bill also states that a Central Consumer Protection Authority (CCPA) will be set up to protect, promote and enforce consumer rights.

The CCPA will have an investigation department to inquire into violations of consumer rights and for imposing penalties. The authority also has the power to initiate class action, and enforcing refund and return of products.

Setting up Redressal Commissions

Consumer Disputes Redressal Commissions (CDRCs) will be set up at the district, state and national levels to address consumer grievances. CDRC can be approached by a consumer to file a complaint with regard to A) defective goods or services; B) overcharging; C) unfair trade practices; and D) sale of goods or services which may be hazardous. The final appeal for all disputes lies with the Supreme Court.

Penalties:

The CCPA can impose a fine of up to Rs 10 lakh on celebrity endorsers or manufacturers for a false or misleading advertisement. CCPA can also impose imprisonment of up to two years for false advertising. Repeat offence will attract fine upto Rs. 50 lakh and jail upto 5 years. Endorsers can be fined upto Rs 10 lakh and one year ban on future endorsements.

Repeat offenders can attract fine upto Rs 50 lakh and ban on future endorsements upto 3 years.

Only in instances where the endorser can prove that they have done due diligence to verify claims made in the ads, will they be exempted from punishment.