India is all set to have a stronger consumer protection law with its own version of class action suits. An informal group of ministers has cleared a proposal to establish a consumer protection authority, which will have the power to order recall of such items or recommend action against the companies to existing sector-specific regulators, and incorporate fresh provisions to make the grievance redress mechanism more consumer-friendly. However, the Indian version will not allow individuals to sue on behalf of a larger group, but will empower an authority to make rulings applicable to larger groups.

Consumer affairs minister Ram Vilas Paswan said many new suggestions have been made to make the law more consumer-friendly. Jaitley has suggested that consumers should be allowed to argue their case at every level irrespective of the amount.

As per Ruling:

• The companies/producers would also have to pay compensation for damage to the consumers.
• This will have the sweeping powers, including taking up cases suo motu besides those referred to the agency.
• It can investigate the cases and order action.

Functions and Advantages:

• The new rules will incorporate a product liability clause to recall items that are unsafe and hazardous.
• The consumer protection authority will fill the gap, which is missing now to deal with unfair trade practices except those covered under the CCI Act.
• The authority can conduct search, seizure of documents, articles and records.
• It can also summon delinquent manufacturers and advertisers and order withdrawal of false or misleading advertisements.
• It can also impose administrative fine on those found violating the law.

What is a class action suit?

A class action suit is one in which one or several persons sue on behalf of a larger group of persons, referred to as “the class”.