Central Government is planning to get Consumer Protection Bill 2015 passed in the upcoming Budget Session of the Parliament. In August 2016, the government had introduced the Consumer Protection Bill 2015 in Lok Sabha, to repeal the 30-year-old Consumer Protection Act, 1986.
A Parliamentary Standing Committee on Food, Consumer Affairs and Public Distribution had also submitted its recommendations in April, 2016. The Bill has incorporated some of the recommendations of the parliamentary committee. The Committee noted that several eminent public personalities or celebrities who are honoured with National Awards such as Padma Shri, Padma Bhushan and Bharat Ratna etc. for excelling in various walks of life are often engaged as Brand Ambassadors for promoting various products. Such personalities are deployed to make advertisements which are often misleading by making unrealistic claims. The consumers tend to believe such advertisements promoted by eminent personalities or celebrities blindly. However, when the unfair trade practices are exposed the celebrities are quick to disassociate themselves with the products/companies they were hitherto representing. The Committee felt that misrepresentation of a product especially a food product should be taken very seriously considering the influence of celebrities and high net worth individuals or companies. The existing laws are not deterrent enough to discourage manufacturers or publishers from using such personalities for misleading advertisements. The Committee has recommended that stringent provisions may be made in the Bill to tackle misleading advertisement, as well as to fix liability on endorsers/celebrities. The Committee recommended that for first time offence, the offender may be penalized with either of a fine of Rs. 10 lakhs and imprisonment upto two years or both, for second time offence, a fine of Rs. 50 lakhs and imprisonment for five years and for subsequent offences, the penalties may be increased proportionately based on the value of sales volumes of such products or services.
The Committee noted that adulteration of food products is a major issue in the country and to tackle the issue effectively, quality checks of products at various levels is a must. Though Food Safety and Standards Act provides for prevention of adulteration in Food, however, there is also urgent
need for stringent provisions to prevent adulteration in other products like drugs, medicines, fertilizers, pesticides, seeds which are used as inputs by farmers for production of foodgrains etc. as well. The Committee is of the considered view that setting up well equipped laboratories with highly qualified/experienced staff in all parts of the country for testing ingredients of all edible products would go a long way in addressing the issue of adulteration of products.
The Committee desired that sufficient well equipped laboratories with qualified technicians for checking the quality of products should be provided right from Central Government level to district level of the respective State Government.
The Committee recommended that severe penalties be imposed on offenders such as rigorous imprisonment of two years with a fine of Rs. 10 lakhs and suspension of license for a period of two years, rigorous imprisonment of five years with a fine of Rs. 50 lakhs and cancellation of license for second time offence and for subsequent offences, the penalties may be increased proportionately based on the value of sales volumes of such products or services.
The Committee desired that the Government may, in consultation with all concerned, consider inserting suitable provisions in the Bill to make it mandatory for the Law Enforcement Agency
to take immediate action in cases where a consumer makes complaint of adulteration of products for human consumption by registering First Information Report (FIR) etc. and arrest the accused person(s). If for any reason, the FIR is not registered by the Law Enforcement Agency, it should be
deemed to have been registered after a lapse of 21 days from the date of complaint.
The Committee observed that definition of person in the Bill includes companies etc. but has left out local authorities. Since the Bill provides for Product liability which includes service liability also, the Committee are of the view that inclusion of local authorities is necessary to protect consumer rights. The Committee recommended that Local Authority may be included in the appropriate place of the Bill.
The Committee noted that Bill defines 'Product Liability" as the responsibility of the manufacturer to provide compensation for any injury caused by defective products or deficiency in service. Thus, the definition of product liability covers a consumer right to seek compensation for injury caused by deficiency in services too. The Committee feel that there is an ambiguity regarding inclusion of services under product liability in the Bill. The Bill lays down conditions for establishing a defect in a product in order to claim product liability. However, it does not specify conditions for establishing deficiency in service in order to claim product liability.
In the absence of specified condition, it is not clear if the consumer can claim product liability for deficiency in service under the Bill. The Committee, therefore, strongly recommend that the Bill should specify conditions for establishing deficiency in services too, in order to claim product liability.
The Committee noted that the above clause of the Bill does not mention the rights of a consumer. Under the Sale of Goods Act. 1930, the buyer has certain rights to terminate the contract. The Committee, therefore, recommend that the Bill should give consumer a right to terminate the contract on the grounds of quality of goods or services received.
The Committee noted that there is shortage of laboratories to point out the defect/adulteration of products. The Committee is of the opinion that specific laboratories should be set up for specific industries and products preferably district-wise to eliminate adulteration and safeguard the interest of the consumers so that they get the right product.
On invitation from the Committee, ToxicsWatch Alliance (TWA) had appeared before the committee and shared its suggestions for safeguarding the rights of citizens and consumers. Among other submissions, it has suggested that the definition of advertisement under Section 2(1) should include electoral promises by political parties and Section 2(30) which defines "product", should include electronic database and biometric database as a product. The 103 page long report is available at: