IAS Gyan

Daily News Analysis



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Context - The Central Consumer Protection Authority has issued notices to Ola and Uber for unfair trade practices and violation of consumer rights.



  • The main issues raised in the notices include: -
    • Lack of proper response from customer support.
    • The driver refused to take payment by online mode and insisted on cash only.
    • The higher amount was charged despite going on the same route previously at a lesser charge.
    • Unprofessional driver behaviour.
    • Inadequate consumer grievance Redressal mechanism in absence of both customer care number and details of grievance officer.
    • Unreasonable levy of cancellation charge.
    • Undue cancellation charges are borne by users when they are forced to cancel the ride due to the unwillingness of the driver to accept the ride.
    • Charge different fares for the same route from two individuals.


Consumer Protection Act, 2019

  • The Act defined a consumer as a person who buys any goods or avails of service for final use.
    • It does not include a person who buys a good for resale or a good or service for commercial purposes.
  • It covers transactions through all modes including offline, and online.
  • The Act clearly defined 6 Rights of consumers:
    • Right to be protected against the marketing of goods and services which are hazardous to life and property.
    • Right to be informed about the quality, quantity, potency, purity, standard and price of goods or services.
    • Right to Choice among a variety of goods or services at competitive prices.
    • Right to be heard
    • Right to seek Redressal against unfair or restrictive trade practices.
    • Right to Consumer Awareness
  • Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers.
    • It functions under the guidelines of The Minister of Consumer Affairs, Food and Public Distribution
    • It regulates matters linked to the violation of consumer rights, unfair trade practices, and misleading advertisements.
    • The CCPA has an investigation wing; they may conduct an inquiry or investigation into the case of violations of rules.
  • Central Consumer Protection Authority (CCPA) functions;
    • Inquiring into violations of consumer rights, investigating and taking appropriate action.
    • It could pass orders to recall goods or withdraw hazardous services, and refund the price paid.
    • It Issues directions to the concerned trader/ manufacturer/ endorser/ advertiser/ publisher to either discontinue a false or misleading advertisement.
    • It imposes penalties on a manufacturer or an endorser of up to Rs 10 lakh and imprisonment for up to two years for a false or misleading advertisement. In case of a subsequent offence, the fine may extend to Rs 50 lakh and imprisonment of up to five years.
    • It Issues safety notices to consumers against unsafe goods and services.
  • Consumer Disputes Redressal Commissions (CDRCs) at the District, State, and national levels.
    • Appeals from the State CDRC will be heard by the National CDRC.
    • The final appeal to the Supreme Court.
    • The District CDRC will entertain complaints where the value of goods and services does not exceed Rs 1 crore.
    • The State CDRC will entertain complaints when the value is more than Rs 1 crore but does not exceed Rs 10 crore.
    • Complaints with a value of goods and services over Rs 10 crore will be entertained by the National CDRC.