India: The Union Cabinet approves the Consumer Protection Bill, 2017

January 15, 2018

The Union Cabinet on December 20, 2017, has given its approval for the introduction of the new Consumer Protection Bill, 2017, to amend the Consumer Protection Act, 1986.[1] The amendment seeks to bring an overhauling change in the domain of consumer law along with the rights of the consumers.

The Bill has been introduced with the aim to ensure swift redressal of the grievances of the consumers and stringent action is taken against unfair trade practices. The Bill seeks to enlarge the scope of the existing Act and proposes stricter actions against misleading advertisements and food adulteration. The Bill also introduces provisions for penalty and jail terms in case of adulteration and misleading advertisements by companies.

With regards to misleading and inappropriate advertisements, the bill provides for both fine and ban on celebrities. In case of first offence, the fine will be up to INR 10,00,000 and a one-year ban on any endorsement. For the second offence, the fine will be up to INR 50,00,000 and up to three years’ ban.
On the other hand, the penalty is slightly higher for manufacturers and companies. The penalty is up to INR 10,00,000 and up to two years’ jail for the first offence. The fine will be up to INR 50,00,000 and five years’ jail for the second offence.

One of the most noteworthy amendment in the bill provides for penalty
up to life term jail sentence in case of adulteration. Further, the Bill seeks to establish a Central Consumer Protection Authority (CCPA) to protect consumer rights. It has provisions for post-litigation stage mediation as an alternate dispute resolution mechanism. The bill also provides for product liability action.


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