TORT 098 Torts and the Consumer Protection Act 2019 Deficiency and Concurrent Remedies — Law of Torts Notes for Judiciary

Torts and the Consumer Protection Act, 2019: Deficiency in Service, Concurrent Remedies, and Unfair Trade Practice

Deficiency in service under the Consumer Protection Act, 2019 and negligence at common law are largely the same enquiry conducted under different labels, and on the same facts they usually produce the same answer. The statutory definition of deficiency expressly includes any act of negligence, so the content of the standard is supplied by the common law. What the consumer legislation changed is not the substance of the wrong but the access to a remedy: the forum, the court fee, the procedure and the speed. The remedies are concurrent, because section 100 provides that the Act is in addition to and not in derogation of any other law.

Deficiency in service, what the Act changed, the pecuniary jurisdiction, and the three comparisons

1. Deficiency in Service

Section 2(11), Consumer Protection Act, 2019

"Deficiency" means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service.

And includes any act of negligence or omission or commission by such person which causes loss or injury to the consumer; and deliberate withholding of relevant information by such person to the consumer.

Negligence is written into the statutory definition, so the question whether a service was deficient is in most cases the question whether reasonable care was taken.
The standard against which performance is measured comes from three sources: what the law requires, what was undertaken by contract, and what was undertaken otherwise.
Deliberate withholding of relevant information is a separate limb, and covers the service provider who knows of a risk or a limitation and says nothing.
"Service" is widely defined in section 2(42) and includes banking, financing, insurance, transport, processing, supply of electrical or other energy, telecommunications, boarding or lodging, housing construction, entertainment, amusement and the purveying of news, excluding a service rendered free of charge or under a contract of personal service.

2. What the Act Actually Changed

The feature	The civil suit	The consumer commission
The forum	A civil court of ordinary jurisdiction	A specialist commission at district, State and national level
Court fee	Ad valorem on the amount claimed	A nominal fee, not ad valorem
Procedure	The Code of Civil Procedure, 1908 and the law of evidence in full	Summary, largely on affidavit, not bound by the strict rules of evidence
Speed	Years, with appeals	Time bound disposal is directed, though not always achieved
Standing	The person aggrieved	A consumer, a registered voluntary consumer association, the Central Authority, or one or more consumers with the same interest
Representation	Ordinarily by advocate	A complainant may appear in person

3. The Pecuniary Jurisdiction

The commission	Where the value of the goods or services paid as consideration
District Commission	Does not exceed fifty lakh rupees
State Commission	Exceeds fifty lakh rupees but does not exceed two crore rupees
National Commission	Exceeds two crore rupees

The limits are those fixed by the Consumer Protection (Jurisdiction of the District Commission, the State Commission and the National Commission) Rules, 2021, notified in December 2021.
The important structural change from the 1986 Act is the basis of the calculation. Jurisdiction now turns on the consideration paid for the goods or services, and not on the compensation claimed, so a complainant cannot select a higher forum by inflating his claim.
Territorial jurisdiction was also widened, and a complaint may now be instituted where the complainant resides or personally works for gain, which reverses the earlier position requiring him to go to the opposite party's place of business.

4. Consumer Compensation and Tort Damages

The heads are substantially the same: medical expenses, loss of earnings, the cost of repair or replacement, pain and suffering, loss of amenities, and mental agony.
The governing principle remains restitutio in integrum, so the assessment follows the principles in TORT 094 and TORT 095.
A commission has powers a civil court does not. It may order the removal of the defect, the replacement of the goods, the return of the price, the discontinuance of an unfair trade practice, the withdrawal of hazardous goods from sale, the issue of corrective advertisement, and the payment of a sum to the Consumer Welfare Fund.
It may award punitive damages, and commonly awards compensation for mental agony and litigation costs in terms that a civil court would frame differently.

5. Concurrent Remedies

Section 100 provides that the provisions of the Act are in addition to and not in derogation of the provisions of any other law for the time being in force.
So the remedies are concurrent. A consumer may sue in a civil court in negligence or in contract, or complain to a consumer commission, and the choice is his.
He may not pursue both to recover twice for the same loss. Anything recovered in one proceeding is adjusted against the other, and a court or commission will decline to award what has already been paid.
The commission is unsuited to a case turning on seriously disputed facts requiring detailed oral evidence and cross examination, particularly expert evidence, and a complaint of that character is liable to be relegated to a civil suit.
The Real Estate (Regulation and Development) Act, 2016 raises the same question for housing complaints, and the position is that the remedies under it and under the consumer legislation are also concurrent and not exclusive.

6. Unfair Trade Practice and the Torts

Section 2(47), Consumer Protection Act, 2019

"Unfair trade practice" means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice.

It includes falsely representing that goods are of a particular standard, quality, quantity, grade, composition, style or model; falsely representing that services are of a particular standard, quality or grade; falsely representing second hand goods as new; representing that goods or services have sponsorship, approval, performance, characteristics, accessories, uses or benefits which they do not have; making a false or misleading representation concerning the need for, or the usefulness of, any goods or services; offering gifts, prizes or other items with the intention of not providing them as offered; and permitting the publication of any advertisement for the sale or supply at a bargain price of goods or services that are not intended to be offered at that price.

	Unfair trade practice	The corresponding tort
A false representation about goods or services	Actionable without proof of reliance or of damage	Deceit requires a false representation of fact made knowingly, an intention that the plaintiff act on it, reliance, and damage: TORT 074
Passing off another's goods as one's own	An enumerated unfair practice	Passing off requires goodwill, misrepresentation and damage: TORT 077
Disparaging another's goods or services	An enumerated unfair practice	Injurious falsehood requires falsity, publication, malice and special damage: TORT 077
Who may complain	A consumer, an association, or the Central Consumer Protection Authority of its own motion	The person wronged

7. Defective Goods, Product Liability and Deficient Service

The claim	What it concerns	The remedy
Defect in goods, section 2(10)	A fault, imperfection or shortcoming in the quality, quantity, potency, purity or standard of the goods themselves	Removal of the defect, replacement of the goods, or return of the price
Product liability, Chapter VI	Harm caused by a defective product. Expressly excludes damage to the product itself and pure commercial loss	Compensation for the harm, without proof of negligence: TORT 080
Deficiency in service, section 2(11)	The performance of a service, and not the quality of a thing	Compensation, and the wider directions the commission may give

A single transaction may give rise to all three, and they are pleaded in the alternative. A defective geyser that fails, injures the user and damages the bathroom raises a defect in the goods, a product liability action for the injury and the property damage, and a deficiency in service if the installation was negligent.

⚠ Why consumer law did not replace the law of torts

It is sometimes suggested that the consumer legislation has superseded the tort of negligence in this field, and the suggestion mistakes a change of forum for a change of law. The Act did not invent a new standard of care: it incorporated the existing one by defining deficiency to include any act of negligence, so a commission deciding whether a hospital, a bank or a builder was deficient is applying the principles in TORT 027 to 029 under another name. What the Act supplied was access: a specialist forum, no ad valorem fee, a summary procedure, relaxed standing and relaxed evidence, which together made it worth a consumer's while to complain about a loss too small to justify a civil suit. That is a very large achievement, and it is an achievement of procedure. The practical consequence for a practitioner is that the substantive learning on negligence is not displaced by the Act but is the material with which a consumer complaint is argued, and that the choice between the two forums turns on the nature of the evidence rather than on the nature of the wrong.

8. The Position Stated Shortly

1. Deficiency under section 2(11) expressly includes any act of negligence, so the common law standard supplies the content of the statutory one.

2. What the Act changed is access to a remedy: the forum, the court fee, the procedure, the speed and the standing, and not the substance of the wrong.

3. The pecuniary jurisdiction under the 2021 Rules is fifty lakh for the District Commission, fifty lakh to two crore for the State Commission, and above two crore for the National Commission.

4. Jurisdiction turns on the consideration paid and not on the compensation claimed, so a complainant cannot select his forum by inflating his claim.

5. The heads of compensation are substantially the same as in tort, and the principle remains restitutio in integrum.

6. A commission has wider powers than a civil court, including the discontinuance of an unfair practice, corrective advertisement and punitive damages.

7. Section 100 makes the Act additional to and not in derogation of other laws, so the remedies are concurrent, though a consumer may not recover twice.

8. A commission is unsuited to a case turning on seriously disputed facts requiring detailed oral and expert evidence.

9. An unfair trade practice overlaps deceit, passing off and injurious falsehood, and requires no proof of reliance or of damage.

10. A defect in goods, a product liability action and a deficiency in service are three different claims which may arise on one transaction and are pleaded in the alternative.