SC Directs Centre To Frame Model Rules For Effective Implementation Of Consumer Protection Act [Read Judgment]

A systemic overhaul of the entire infrastructure is necessary if the Consumer Protection Act, 1986, is not to become a dead letter, it said 

The Supreme Court on Monday directed the Central Government to frame model rules relating to administration, selection and appointments of members, infrastructure etc., at all levels of consumer fora constituted under the Consumer Protection Act, 1986.

A three-judge bench comprising Chief Justice TS Thakur and Justice DY Chandrachud and Justice L Nageswara Rao stated that a systemic overhaul of the entire infrastructure was necessary if the Consumer Protection Act, 1986, is not to become a dead letter.

On 14 January 2016, the Supreme Court constituted a committee presided over by Justice Arijit Pasayat to examine:

i) the infrastructural requirements of the state commissions, deficiencies in infrastructure and remedial measures;

ii) the position of vacancies of members at the national, state and district levels;

(iii) the need for additional benches at the national, state and district levels;

(iv) conditions of eligibility for appointment of non-judicial members;

(v) administrative powers which have been or should be conferred on the presiding officers of the state and district fora;

(vi) service conditions, including pay scales governing the presiding officers and members;

(vii) requirements of staff;

(viii) creation of a separate cadre of staff at the national, state and district levels; and

(ix) other relevant issues.

The committee, in its interim report, observed that the fora constituted under the enactment do not function as effectively as expected due to a poor organisational set-up, grossly inadequate infrastructure, absence of adequate and trained manpower and lack of qualified members in the adjudicating bodies.

Benches of the state and district fora sit, in many cases, for barely two or three hours every day and remain non-functional for months due to a lack of coram. Orders are not enforced like other orders passed by the civil courts. The state governments have failed to respond to the suggestions of the committee for streamlining the state of affairs.

The committee has observed that the problem lies in (i) absence of proper remuneration; (ii) appointment of former judicial officers who lack motivation and zeal; (iii) appointment of practicing lawyers as presiding officers of district fora; and (iv) political and bureaucratic interference in appointments. Many of the non-judicial members attend the place of work only to sign orders, which have been drafted by the presiding officer.

The bench observed that though the powers relating to the appointments and administration of the state fora lie with the state government, it may result in a lack of uniformity of rules across the country, both in regard to the terms and conditions of service, as well as in regard to the modalities to be followed in ensuring that persons appointed as members fulfill the prescribed qualifications.

“In the absence of a uniform pattern, the result is a wide variation in standards and a great deal of subjectivity, and bureaucratic and political interference, which has been noticed in the reports submitted by the committee to this court.” 

Considering the above difficulties, the bench directed the Central Government to frame model rules. 

The bench issued the following directions to the government:

(i) The Union Government shall for the purpose of ensuring uniformity in the exercise of the rule making power under Section 10(3) and Section 16(2) of the Consumer Protection Act, 1986, frame model rules for adoption by the state governments. The model rules shall be framed within four months and shall be submitted to this Court for its approval;

(ii) The Union Government shall also frame within four months model rules prescribing objective norms for implementing the provisions of Section 10(1)(b), Section 16(1)(b) and Section 20(1)(b) in regard to the appointment of members respectively of the District fora, State Commissions and National Commission;

(iii) The Union Government shall while framing the model rules have due regard to the formulation of objective norms for the assessment of the ability, knowledge and experience required to be possessed by the members of the respective fora in the domain areas referred to in the statutory provisions mentioned above. The model rules shall provide for the payment of salary, allowances and for the conditions of service of the members of the consumer fora commensurate with the nature of adjudicatory duties and the need to attract suitable talent to the adjudicating bodies. These rules shall be finalized upon due consultation with the President of the National Consumer Disputes Redressal Commission, within the period stipulated above;

(iv) Upon the approval of the model rules by this Court, the state governments shall proceed to adopt the model rules by framing appropriate rules in the exercise of the rule making powers under Section 30 of the Consumer Protection Act, 1986;

(v) The National Consumer Disputes Redressal Commission is requested to formulate regulations under Section 30A with the previous approval of the Central Government within a period of three months from today in order to effectuate the power of administrative control vested in the National Commission over the State Commissions under Section 24(B)(1)(iii) and in respect of the administrative control of the State Commissions over the District fora in terms of Section 24(B)(2) as explained in this Judgment to effectively implement the objects and purposes of the Consumer Protection Act, 1986.

Read the Judgment here.

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