Comparison on Consumer Protection Act 1986 with the New Consumer Protection Act 2019 notified on 20.07.2020 for implementation.

By N.Naresh Kumar, HRO, NICL.

In exercise of the powers conferred by sub-section (3) of section 1 of the Consumer Protection Act, 2019 (35 of 2019), the Central Government hereby appoints the 20th day of July, 2020 as the date on which the following provisions of the said Act shall come into force.

Objective of new 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.

Chapter

Sections

Section 2
Except Clauses (4), 13, 14, 16, 40

Section 3 to 9

Section 28 to 73
Except sub-clause (iv) of clause (a) of Sub-section (1) of section 58.

Section 74 to 81 (Both Inclusive)

Section 82 to 87 (Both Inclusive)

VII

Section 90 and 91
Except sections 88, 89, 92 @93

VIII

Section 95, 98,100
Section 101
Except Clauses (f) to (m) and Clauses (zg) (zh) and (zi) of Sub-section 2 Section 102, 103, 105, 106, 107
(Except sections 94, 96, 97, 99, 104)

Comparison of the old and new C.P Acts:

ACT

CPA 1986

CPA 2019- 20.07.2020 Notified

Objective of ACT

to provide for better protection of the interests of consumers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consumers’ disputes and for matters connected therewith

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.

Chapters

8 (Notified only 7 Chapter)

Nomenclature

District forum

District Commission

Regulator

No Separate Regulator

Central Consumer Protection Authority under Chapter III is not notified in July 2020

So exempted in the present notification.

New Definitions

Not defined

Online, telemarketing, MLM, unfair contract, design, endorsement of goods, electronic service provider, Food included in goods, product liability, mediation, pecuniary jurisdiction, offence and penalties

Not defined

“advertisement” means any audio or visual publicity, representation, endorsement or pronouncement made by means of light, sound, smoke, gas, print, electronic media, internet or website and includes any notice, circular, label, wrapper, invoice or such other documents;

Consumer Definition

Only one explanation given under Section 2(d).

A new Clause ‘b’ is inserted to the explanation of Consumer defined under Section 2(7). The expressions “buys any goods”

and “hires or avails any services” including offline or online transactions through electronic means or by teleshopping or direct selling or multi-level marketing are included.

(a) the expression “commercial purpose” does not include use by a person of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self- employment;

Excludes a person who avails of such services for any Commercial purposes.

No clarity with explanation on ‘commercial purpose’ in the definition

Person

Consumer is a ‘person’: includes 2 (m)

Person definition extended under Section 31 (1)

(vi) any corporation, company or a body of individuals whether incorporated or not;
(vii) any artificial juridical person, not falling within any of the preceding sub-clauses.

Due to the extension the earlier plea of commercial purpose and commercial entity will not come under the purview of consumer is marginalised and it still need better clarification because it became ambiguous by adding them and not still continuing the exclusion of commercial purpose.

(i) (ii)

(iii)

(iv) (v)

an individual; a firm whether

registered or not;
a Hindu undivided

family;
a co-operative society; an association of

persons whether registered under the Societies Registration Act, 1860 or not

Complainant

Definition extended

(vii) in case of a consumer being a minor, his parent or legal guardian.

Consumer, Registered

voluntary consumer

association, Central

Government, consumers same

interest, Consumer, his legal

heir or representative in case

of his death

Deficiency

Defined

Deficiency extended:

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.

Design

Not defined

Section 2 (10) –”design”, in relation to a product, means the intended or known physical and material characteristics of such product and includes any intended or known formulation or content of such product and the usual result of the intended manufacturing or other process used to produce such product;

Insurance

Under definition ‘Service’ Section 2 (o).

Under definition ‘Service’ Section 2 (42).

Unfair Contract

No definition

(46) “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:—

(ii) 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

(iv) entitling a party to the contract to terminate such

contract unilaterally, without reasonable cause; or
(v) 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

(vi) imposing on the consumer any unreasonable charge, obligation or condition which puts such consumer to disadvantage;

Product Liability

No provision. Consumer could approach a civil court but not consumer court

Section 82 to 87 (Both Inclusive)

Consumer can seek compensation for harm caused by a product or service.

Product Liability Definition

No definition

Under Section 2(34) added and fixed responsibility the product manufacturer or product seller, of any product or service, in case of harm to consumer.

Consumer Rights

Objects of the Central Council

Section 2(9) has added and defined such rights as ‘rights of consumer’
Protection, Informed, Assured, Be heard, Redressal and Consumer Awareness.

protect rights such as. (List).

Right of Consumer Awareness

Consumer Awareness

Limitation period for filing compliant

Consumer Education is the

term

2 Years

2 years with a provision for condonation of delay power U/s 69 of the Act.

Filing Jurisdiction

• Complaint could be filed where the Seller’s (Defendant) office is located.

Complaint can be filed where Complainant resides or work.

Electronic Filing

Not available

Available

• District: Upto Rs. 20 Lakhs

• District: Upto Rs. 1 Cr.

Pecuniary Jurisdiction

• State: Rs.20 Lakhs to Rs.1 Cr. • National: Above Rs. 1 Cr.

Where the value of the goods

• State: Rs. 1 Cr. To Rs. 10 Cr. • National: Above Rs. 10 Cr.

or services and the

compensation, if any, claimed

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:

Need a detailed interpretation on whether it was used intentionally or not.

Written Statement

1[does not exceed rupees

twenty lakhs].

30 + 15 days
within a period of thirty days or such extended period not exceeding fifteen days
within a period of thirty days or such extended period not exceeding fifteen days

30 + 15 days Same

Apex court In New India Insurance Vs Hilli Multipurpose Cold Storage Private Limited held that District Forum is not having power to extend the limitation period further to 45 days and 30 days commences from the date of receipt of notice accompanied by the complaint and not just notice.

Appeal Deposit

Fifty per cent. of that amount or twenty-five thousand rupees, whichever is less. (Maximum of Rs. 25,000/-)

Needs to deposit 50% of the amount ordered by District Commission before filing appeal before State Commission.

Appeal Deposit in SCDRC

Appeal Deposit in NCDRC

50% of the amount or rupees

thirty-five thousand,

whichever is less

50% of the amount or rupees

Fifty thousand, whichever is

Appeal to NCDRC from SCDRC which is 30 days remained same, subject to deposit of 50% of the award if specified by SCDRC

Appeal to Supreme Court from NCDRC which is 30 days remained same, subject to deposit of 50% of the award if specified by NCDRC. (Clause

less

30 days for filing of appeal to State Commission.

No such Legal Provision

No such legal provision

67).

Limitations

45 days for filing of appeal to State Commission. (Clause 41)

Mediation

Court can refer settlement through mediation.
New Chapter of V is added

Partial Settlement through mediation

Parties can agree for the settlement before mediator and that can be forwarded and a suitable order shall be passed in 7 days. There is scope for partial settled only in part on some specific issues and remaining issues can be decided by the Commission.

No appeal on settlement order

No such provision

Barring appeal from an order passed under clause 80 on the basis of settlement reached between the parties.

Clause 80 –(This clause provides for provisions relating to settlement through mediation and the role of mediator when 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, and in the event where no agreement is reached between the parties).

Procedure on admission of complaint &
Ex parte Orders

Where the complainant fails to

Section 38 (3) (c) : Decide the complaint on merits if the complainant fails to appear on the date of hearing.

appear on the date of hearing

before the District Forum, the

District Forum may either

dismiss the complaint for

default or decide it on merits.

Review

No power of Review (Except NCDRC)

Power of review has been conferred to District Commission, State Commission

Appeal Limitation Period

order made by it, when there is

an error apparent on the face of

record.

30 days

and NCDRC U/s 40, 50 and 60 of the Act respectively and application to be made in 30 days.

Review by NCDRC

The National Commission shall

Clarity given that either of its own motion or on an application made by any of the parties within thirty days of such order.

have the power to review any

Every appeal under this section shall be preferred within a period of thirty days from the date of order of a District Commission or a State Commission or the National Commission.

NCDRC can hear appeals of central authority

No such provision

Sub-clause (iv) of clause (a) of Sub-section (1) of section 58— Not notified in July 2020 and Even Central authority under Chapter III is not notified.

Second appeal to NCDRC

No second appeal only Revision was available in NCDRC

Provided U/s 51(3) if there is a substantial question of law involved in the matter

Non-Compliance of order of Commission

Shall be punishable with

imprisonment for a term which

shall not be less than one

month but which may extend

to three years, or with fine

which shall not be less than

two thousands rupees but

which may extend to ten

thousand rupees, or with both

Under Section 72 of the Act, the term for imprisonment for non- compliance of order given by District, State and National Commission is same as previous act but the fine has been increased, which shall not be less than twenty-five thousand rupees and may extend to one lakh rupees, or with both.

Enforcement of orders of District Commission, State

Section 25:
Property attachment for non- compliance and it should be it be sold after 3 months if non- compliance continues. A

No such detailed description on enforcement.

Section 71: Every order made by a District Commission, State

Commission and National Commission

certificate can be issued by DC, SCDRC or NCDRC to District collector to collect the amount from arrears of land revenue.

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.

Penalties

Section 90 Punishment for manufacturing products containing adulterant

Section 91 Punishment for manufacturing for sale or for storing or selling or distributing or importing spurious goods.

Does not result in any injury to the consumer, with imprisonment for a term which may extend to six months and with fine which may extend to one lakh rupees.

Causes injury not amounting to grievous hurt to the consumer, with imprisonment for a term which may extend to one year and with fine which may extend to three lakh rupees.

Causes injury resulting in grievous hurt to the consumer, with imprisonment for a term which may extend to seven years and with fine which may extend to five lakh rupees

Power of District Collector

No powers

Central Consumer Protection Authority under Chapter III is not notified in July 2020

Consumer protection agencies

No such provisions

Incorporated under Chapter III is not notified in July 2020

Contract Terms

No such powers to change

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

Bench

Circuit Bench

Replaced with the term Regional Benches
Provided that the Central Government may, by notification, establish regional Benches of the National Commission, at such places, as it deems fit.

Composition of Commission.

District Forum—1 President + 2 members and one among them shall be women.

District Commission—1 President + 2 members

(‘Shall be women’ is omitted in new act)

State Commission — 1 President + 4 members

National Commission — 1 President + 4 members

Experts to assist National Commission or State Commission.

No such provision

Section 66: Where the National Commission or the State Commission, as the case may be, on an application by a complainant or otherwise, is of the opinion that it involves the larger interest of consumers, it may direct any individual or organisation or expert to assist the National Commission or the State Commission, as the case may be

Dismissal Of Frivolous OR Vexatious Complaints

Such complaints will be dismissed and
complainant shall pay cost not exceeding

No such provision

Rs.10,000/- as may be specified in the order

Councils

To advice to Govt on the functioning of the ACT

To advice to Govt on the functioning of the ACT (Chapter 2)

No changes in the new act

Product Seller

Not included and only traders was included

Included in the definition of

And due to this shopkeepers comes under the purview of the CPAct

Video conferencing

NO such Provision

Consumers can seek hearing through video conferencing

Still there are some differences between the old act and new Consumer Protection Act, 2019 and will be improvised based on the interpretation of the court judgements also.