A Very Brief History of Consumer Protection in India

A Brief History of Consumer Protection in India

Image by Andreas N from Pixabay 

The recent passage of the Consumer Protection Act of 2019 on July 30th in the Rajya Sabha, has brought renewed public attention to the evolution of protections afforded to consumers in India. According to an article written by Dr A Rajendra Prasad, writing in the “Journal of Consumer Law, Texas, USA, there have been a variety of texts that have ruled on consumer protection, such as the “ Smriti’s” particularly the Manu Smriti (said to be written between 800 and 600 BC) which prescribed a code of conduct for traders and specified punishments for crimes against buyers.

The Shodganga an online reservoir of theses, also refers to the emergence of guilds during the Buddhist period and their role in shaping business practices and setting standards.

Dr Prasad goes on to cite “Kautilya’s Arthasastra” (circa 400-300 BC) which focused on Public Administration was written during Chandragupta’s reign. Kautilya is better known as Chanakya. The Arthasastra also addressed consumer protection in some detail. There was in that time an individual who served as a “Director of trade.” This worthy was tasked with monitoring the market and was responsible for fair trade practices including the standardization of weights and measures. Traders were licensed and travelling traders had to apply for a permit.

According to Yajnavalkya (II, 251-53) the king was to fix the price of commodities allowing five percent profit on indigenous goods and ten percent on foreign products.

During the Muslim Delhi Sultanate (1206 to 1526) the Sultan typically specified grain prices and enforced consistency in weights and measures.

During the Mughal period, many rulers were interested in the social and moral development of the people/ “Mohtasibs” or censors of public morals were responsible for keeping an eye on public behavior. During the later Mughal period, beginning with Akbar, commerce greatly expanded. The kingdom was self-sufficient in most areas and the highly mobile Banjara community would trade the surpluses from various communities.

The British tried to combine British law with local tradition. Laws relating to Consumer Protection include: The Indian Penal Act of 1860, The Indian Contract Act of 1872, the Usurious Loans Act of 1918 and the Drugs & Cosmetics Act (1940) are a small sample of the legislation supporting consumers that was produced during the British era.

Independent India also produced its share of legislation including the Industries (Development and Regulation) Act (1951), The Drugs & Magic Remedies (Objectional Advertisements) Act and the Prevention of Adulteration Act (both in 1954), The Essential Commodities Act (1955), Trade & Merchant Marks Act (1958), the Monopolies & Restrictive Trade Policies Act (1969).

The Consumer Guidance Society (CGSI) an organization that advocated for consumers was set up in 1966. The CGSI also had a role to play in the formation of the first Consumer Protection Act which was passed in 1986 with an amendment that closed certain loopholes passed in 1993. They also have a monthly magazine called Keemat                                        ( http://cgsiindia.org/wp-content/uploads/2019/06/Keemat-July-August-2019.pdf ). The Consumer Protection Act was updated again in 2019 to include restrictions on celebrity endorsements and better cover online issues.

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