Page 37 - Insurance Times December 2020

Enhanced pecuniary limits District Commission (formerly
District forum) now can entertain consumer complaints
up to Rs. 1 crore which earlier was up to Rs. 20 Lakh
only. Likewise, pecuniary limits of State Commission
revised for more than Rs. 1 crore to Rs. 10 crores
(earlier Rs. 20 Lakh to Rs. 1 Cr). National Commission
has jurisdiction above Rs. 10 crores.
Electronic filing- Earlier consumer had the right to file
the complaints at the place of purchase of merchandise
or at a place where the seller has the registered office.
Now this condition has been done away with. This act
covers the electronic transactions explicitly which were
not covered in the earlier act. Now complaints can be
filed electronically and hearing can be using video
conferencing.
Establishment of the Central Consumer Protection
Authority (CCPA). CCPA has been constituted with the Source: https://economictimes.indiatimes.com/
vision to protect, promote and enforce the rights of the
consumer. It is having powers to investigate, impose Liability Insurance in India.
penalties, recall, refund, regulate cases pertaining to Liability insurance policies are typically meant for coverage
unfair trade practices, misleading advertisements and for legal costs and payouts imposed by lawsuits, if found
protection of consumer rights. legally liable. In India, we see statutory liability policies
Penalties for misleading advertisements. Fine of up to i.e. Third Party motor (TPL) Policies and Workmen
Rs. 1 crore and/or imprisonment upto 2 years on the compensation (WC) are prevalent as these are mandatory
manufacturer, endorser for false and misleading in nature by compulsion of motor vehicle act and workmen
advertisements can be imposed by CCPA compensation act. Other forms of liability policies like
professional indemnity, CGL, D & O, Product liability are
This act provides resolution of disputes through lesser prominent.
Alternate Dispute Resolution (ADR) methods.
Mediation cells shall be formed under the aegis of In India, before the enactment of CPA 2019, there was no
consumer commissions for early settlements of disputes. specific statute that can exclusively cover the disputes
This will make adjudication simpler and quicker and pertaining to product liability. In the absence of statutory
alleviate the pressure of an increasing number of cases law, courts were guided by the principles of justice, equity
on courts who already have numerous cases pending and a good conscience and frequently guided by the
before them. If the mediation fails normal hearing will provisions of English Law. The famous cited case of
resume at the commission. Donoghue v. Stevenson lays down the position where one
owes a duty of care to another, and if such duty of care is
breached, there is negligence irrespective of whether any
contractual relationship exists between the parties or not.
In this famous case, Mrs. Donghue went to the café along
with her friend. Her friend bought ginger beer.

The bottle containing ginger beer was opaque. Mrs.
Dongue drank a little beer from the bottle & then pour the
rest into a glass. Along with beer, a dead snail lands in the
glass. Mrs. Donghue suffered from gastroenteritis and
shock. She sued the manufacturer of ginger beer. The
House of Lords held that the manufacturer was liable to pay
The Insurance Times, December 2020