Consumer body issues notices to IAS coaching centres for ‘misleading’ ads

Subject :Polity

Section: National Body

Context: Consumer body issues notices to IAS coaching centres for ‘misleading’ ads

More about the news:

The Central Consumer Protection Authority (CCPA) has issued notices to 20 IAS coaching institutes in India for issuing “misleading” advertisements targeting civil services aspirants.
The CCPA is taking action under Section 2(28) of the Consumer Protection Act, 2019, which defines “misleading advertisement.“
These institutes are accused of making false claims or exaggerations in their advertisements.
One example provided by the CCPA is an institute claiming credit for 682 out of 933 selected candidates in the UPSC examination in 2022. However, it was clarified that most of these candidates had only availed mock interviews and tests, and this was not clearly disclosed by the institute.
The coaching industry in India generates significant revenue, approximately Rs 58,088 crore.
The CCPA has imposed penalties on four of the 20 coaching institutes, with two having paid and two approaching the court.
Proper disclosure by coaching institutes is seen as essential to prevent consumer deception.

What is the Section 2(28) of the Consumer Protection Act, 2019

The Section 2(28) of the Consumer Protection Act, 2019 defines “misleading advertisement” in relation to any product or service which—

falsely describes such product or service;
gives a false guarantee to, or is likely to mislead the consumers as to the nature, substance, quantity or quality of such product or service;
conveys an implied representation which, if made by the manufacturer or seller or service provider thereof, would constitute an unfair trade practice;
deliberately conceals important information.

What is the Central Consumer Protection Authority (CCPA):

Central Consumer Protection Authority is a regulatory body established in 2020 based on the provisions of the Consumer Protection Act, 2019 and works under the administrative control of the Ministry of Consumer Affairs.
It is headquartered in New Delhi

What are the Objective of Central Consumer Protection Authority:

To promote, protect and enforce the rights of consumers as a class.
To conduct investigations into violation of consumer rights and institute complaints.
To order the recall of unsafe goods and services,discontinuation of unfair trade practices and misleading advertisements.
To impose penalties on manufacturers,endorsers and publishers of misleading advertisements.

What is the composition of Central Consumer Protection Authority

The Central Consumer Protection Authority consists of following members appointed by the Central Government.
- Chief Commissioner
- Two Commissioners. One commissioner each for goods and services.
- An Investigation Wing headed by a Director General.
- District Collectors too, have the power to investigate complaints of violations of consumer rights, unfair trade practices, and false or misleading advertisements.

What are the power and functions of Central Consumer Protection Authority(CCPA)

CCPA can investigate matters relating to violations of consumer rights or unfair trade practices suo motu,
Section 20 of the Act gives powers to the CCPA to order recall of hazardous goods.
CCPA has the power to impose a penalty up to Rs 10 lakh, with imprisonment up to two years, on the manufacturer or endorser of false and misleading advertisements. The penalty may go up to Rs 50 lakh, with imprisonment up to five years, for every subsequent offence committed by the same manufacturer or endorser.
CCPA has the power to ban the endorser of a false or misleading advertisement from making endorsement of any products or services in the future, for a period that may extend to one year. The ban may extend up to three years in every subsequent violation of the Act.