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'Nothing Was Done Before Act Was Introduced' : Supreme Court Directs Centre To Conduct Legislative Impact Study Of Consumer Protection Act 2019

Mehal Jain
11 Aug 2021 11:21 AM GMT
Nothing Was Done Before Act Was Introduced : Supreme Court Directs Centre To Conduct Legislative Impact Study Of Consumer Protection Act 2019
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The Court has given 4 weeks time to Central Government to do the legislative impact assessment.

The Supreme Court on Wednesday directed the Union of India to fill up all vacancies in the NCDRC in the same time frame as stipulated for the states/UTs to fill up the vacancies in SCDRCs, being 8 weeks.A bench comprising Justices Sanjay Kishan Kaul and Hrishikesh Roy passed the direction in a suo motu case taken to address the issue of unfilled vacancies in consumer disputes...

The Supreme Court on Wednesday directed the Union of India to fill up all vacancies in the NCDRC in the same time frame as stipulated for the states/UTs to fill up the vacancies in SCDRCs, being 8 weeks.

A bench comprising Justices Sanjay Kishan Kaul and Hrishikesh Roy passed the direction in a suo motu case taken to address the issue of unfilled vacancies in consumer disputes redressal commissions.

Also, the Court directed the Union Government to present before it the legislative impact study with respect to the Consumer Protection Act 2019 within 4 weeks. Legislative impact assessment is an informed law-making process under which social, economic, environmental and institutional impacts of legislative proposals are made.

Legislative Impact Study by the UOI
During the hearing, the bench considered the issue of legislative impact study and whether the same was undertaken before the new Consumer Protection Act of 2019 came into being. The bench noted that the same was in the context that the new Act expanded the jurisdiction of the consumer fora which would result in litigation shifting to the consumer fora, apart from the aspect of the variation in the pecuniary jurisdiction by increasing the jurisdiction of the state and district fora.
"Unfortunately, nothing was done before the Act was introduced. The affidavit now filed on behalf of the Union of India refers to a post-facto exercise after the Act has come into force and that too only in respect of increase in the pecuniary jurisdiction. At least now a comprehensive legislative impact study should be done post the legislation and what has been done by writing letters to the states post facto is only about the pecuniary jurisdiction. It does not deal with the aspect of expanding the subject-matter jurisdiction of the consumer fora, which results in the litigations shifting from other fora, and which must have already happened in the last two years. The study should be undertaken and placed before us within four weeks. In terms of the judgement of this Court, the past cases will remain in the existing fora and only the future cases will be filed in the consumer fora. That being the position, an assessment can be made of how many more cases would arise in these fora to make necessary arrangements for infrastructure and manpower", directed the bench.
Additional Solicitor General Aman Lekhi told the bench that as regards impact assessment, there is already a pre-legislative consultation policy which is in place which provides for consultations with the stakeholders. "It is a 2019 Act, it has had three or four prior incarnations starting with the 2011 Bill", he sought to submit.
Justice Kaul remarked, "A legislative impact study is to be done if you want a new avatar of an Act- The changes you propose to make, what impact would it have on the litigation, what is the kind of manpower required, what is the infrastructure required. Has this been done or not? The answer is 'yes' or 'no'"
Amicus Curiae Senior Advocate Gopal Sankaranarayanan told the bench, "This was done only after the Act was notified and brought into effect. The affidavit of the Union says there was a response to it from 18 states and 11 have suggested revision of the pecuniary jurisdiction".
The ASG replied, "We are not in a litigious capacity here. Adulteration, unfair trade practises, misleading advertisement, pecuniary jurisdiction are the heads under which this new Act has made changes. They were all part of the recommendations of the Standing Committee".
"So no study was done! The Standing Committee just recommended these changes. But what impact will it have on litigation? That is the study and it was not done! This is the greatest irony in legislation- you never do a study. The government does not want to say that the answer to this is 'no'. I have full sympathy for you, Mr. ASG. Drawing out information from the government is a very difficult task. What you should have done, you have not done. But now you say you have written to the state governments for the response. We will record that it was not done and now you have done so post the Act", said Justice Kaul.
The ASG sought to submit that the 2019 Act is an amendment of the 2015 Bill which was the subject matter of the standing committee report, by which the new subject matters were added and pecuniary jurisdiction was enhanced, and that no states had objected to it.
"When no study is there, there is no clarity as to what infrastructure should be there at what level, how much manpower should be there at what level. In 2019, you brought the Act. In 2021, two years later, we are still trying to implement the infrastructure. It is certainly the states' responsibility, but you don't have an impact study on what is going to happen, at the relevant level! It is a post-facto analysis two years later that we are doing", remarked Justice Kaul.
When the ASG sought to say that 4 weeks is too short a time for the completion of the study, Justice Kaul commented, "You are making legislations come immediately!"
"It is not a very complex situation as now you know how many cases are being generated in the last 2 years, how much manpower you need. But what is a prerequisite has not been done. Let us do a 'post requisite' now. We are not looking at what will happen but what has already happened in the last two years", said the judge.


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