Consumer Protection Act 2020 Implementing From July 20


The Consumer Protection Act (CPA), which was introduced in Parliament back in 2019, is now all set to come into force in July 2020. The new law is aimed to protect the Indian consumerism from frauds, transaction errands, and cheating from sellers and manufacturer. 

Beginning today, several new and improved actions of the CPA 2020 will come into force. It will now be allowing mediation, hearing of cases of a much higher value up to Rs 1 Crore and a provision to challenge unfair practices of a seller by the general population has been introduced. 

Consumer Protection Act 2020

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Highlights of the Consumer Protection Act 2020:

Last year, the bill was introduced in the Parliament on July 8, 2019, by Union Minister of Consumer Affairs, Food, and Public Distribution, Ram Vilas Paswan. With lots of discussion and debate, the new rules replace the Consumer Protection Act, 1986, and define six basic consumer rights. 

  1. Be protected against the marketing of goods and services which are hazardous to life and property
  2. Be informed of the quality, quantity, potency, purity, standard and price of goods or services
  3. Be assured of access to a variety of goods or services at competitive prices
  4. Seek redressal against unfair or restrictive trade practices.

*With the new rules, a consumer who is sold an adulterated product is subjected to compensation of up to Rs 1 Lakh. While the respective seller could be sentenced for up to 6 months of jail. 

*In case of direct or indirect damage or harm by the sold product, a consumer can file for a compensation amount of up to Rs 5 Lakh. And the seller is a subject to be sentenced for up to 7 years of jail.  

*If the consumer dies, the compensation amount is set at Rs 10 Lakh and the seller is to be punished with a life imprisonment term. 

*Formation of the Consumer Disputes Redressal Commissions (CDRCs). These commissions will exercise matters at the district, state, and national levels.  

*The District CDRC will take on the matter of fraudulent or cheating in goods and services of up to Rs 1 Crore. While the State CDRC will entertain matters that exceed Rs 1 Crore but lower than Rs 10 Crore. And above Rs, 10 crores will be taken in National CDRC. 

*Manufacturers or sellers who are delivering a misleading advertisement are subjected to a penalty of Rs 10 Lakh and will be sentenced for up to 2 years of jail. 

*In cases of subsequent advertising offense, the penalty amount increases to Rs 50 Lakh and imprisonment for up to 5 years. 

*Powers of the district and state consumer courts have been boosted up to take better action against malpractices and errant transactions in which the consumer is directly or indirectly affected. 

*A consumer can file a complaint to the CDRC concerning-

  1. Unfair or restrictive trade practices
  2. Defective goods or services
  3. Overcharging or deceptive charging 
  4. The offering of goods or services for sale which may be hazardous to life and safety.

Meanwhile, there will be additional guidelines to be released from the central government on the topic. Also, a new chapter of the Act will be added in the future for a complete description of the rules and regulations and basic information for new consumer rights. 

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