Laws against False and Misleading Advertisements in India

This article on ‘Laws against False and Misleading Advertisements in India‘ was written by Monika Yadav, an intern at Legal Upanishad.

Introduction

It is undeniable that advertisements have an impact on consumer rights, and as a result, promotions should be reasonable and true. False and misleading notices are not only unreliable, but they also distort competition and, naturally, consumer decisions. In this article, we will understand the term false and misleading advertisement. We look into the laws which right the customers against such misleading advertisements we also analyse the laws and look into the aspects which could be adopted in future legislation and the end concludes our article with a short and crisp conclusion.

What does false and misleading advertisement mean?

Advertisements for any good or service are deceptive. A misleading advertisement is one that intentionally omits key details and falsely characterizes a product or service. It also gives a false assurance about the product or service’s nature, content, efficiency, and amount while purposefully hiding critical information.

Laws & regulations

• In 2020, the Consumer Protection Act of 2019 became law. The new law will give consumers more power and enact numerous rules and regulations to support them in upholding their rights. These provisions include consumer protection guidance, consumer dispute resolution committees, mediation, product safety, and fines for the production or sale of products. This encourages, defends, & upholds consumer rights.
• For the purpose of preventing unethical corporate activities in e-commerce, the legislation calls for the creation of the Central Consumer Protection Authority (CCPA). The CCPA will have the authority to look into cases of Abuse of consumers, harassment or complaints, forced recalls of unsafe products and services, prohibition of unfair commercial practises and deceptive marketing, and sanctions against marketers, sponsorships, and publishing houses. The law shall also be governed by the regulations preventing unfair commercial practises on e-commerce networks.
• All e-commerce businesses are required by law to give customers the information they need to make informed purchases on these platforms, such as country of origin, regarding returning, refundability, exchanges, warranty claims and guaranty, shipment or delivery, payment options, exemption techniques, modes of payment and their reliability, and other topics.
• Additionally, it is claimed that e-commerce platforms are required by law to acknowledge any customer complaints received within 48 hours of receipt and to respond to them within a month of that date. This new legislation codifies the idea of liability of a product and gives product dealers, item service providers, including product manufacturers the right to file any kind of damage claims.
• The law also streamlines the procedure for settling consumer complaints at the Consumers Commission, which includes – allowing regional and state committees to assess those directives, enabling clients to submit grievances digitally, and enabling clients to file a grievance with a qualified consumer committee on-site. If the accepted dispute is not addressed within the allotted 21 days, a claim may be made to the consumer commissions which have authority over the dwelling, and complaints may be heard via videoconference and considered admissible.
• The new rule also streamlines the arbitration process and offers a method for mediating conflicts. The Consumer Council would complain about mediation if some reservations were done in advance and both parties agreed to it. There won’t be any court appeals for mediation because the mediation panel was constituted under the supervision of the Consumer Protection Commission. The Consumer Protection (General) Rules, 2020 state that there cannot be a fee in situations up to Rs. 5 lakh. The mechanisms for filing procedures digitally and crediting money to the Consumer Welfare Fund so the consumer is unable to be identified (CWF).
• The State Commissions provide the Central Government with information on recruitment, disposal of, the status of cases, and other topics quarterly. The older Consumer Protection Act of 1986 only required one factor, which added time, to obtain the right to access justice. The revised Act was released following numerous revisions to provide customers with protection from dishonest merchants and new e-commerce retailers/platforms. The Act will serve as a crucial weapon in defending the nation’s consumer rights.
• The Cable Television Networks (Regulations) Act, of 1995 forbids anybody from using cable television to rebroadcast programmes unless the rules specifically permit it.

According to Rule 7 of the Cable Television Networks (Amendment) Rules, 2006, a set of regulations created under the CTN Act, cable service providers are required to make sure that no advertisement is broadcast that offends consumers’ morals, sensibilities, or religion.

• In violation of the Cigarettes and other Tobacco Products(Prohibition) Act’s restriction a person may receive a fine or up to two years behind bars for engaging in the direct or indirect promotion of smoke or similar tobacco materials in all sound, visual, and media outlets. The CTP Act also gives authorized entities the right to look for, any promotions for a cigarette or even other tobacco items that shall be seized, forfeited, and confiscated.
• Drugs and Magic Remedies (Objective Advertisements) Act of 1954 the Act did not, however, prescribe any harsh punishments or incarceration, and it was out of date in terms of deceptive ads and other problems.
• False advertising of products and services was deemed to be a type of unfair trade practises under the Monopolies and Restrictive Trade Practices Act of 1969. According to the Consumer Protection Act of 1986, any deceptive advertising of products or services shall be regarded as unfair business practises.

Cases of Misleading Advertisement

Francis Vadakkan v. The Proprietor, A-One Medicals & Ors.

The matter just concluded on January 22, 2021. In this case, which is being heard by the Kerala District Commission, the accused is a company that produces hair growth cream. In a commercial it published, it stated that using its product would result in a three-fold increase in the length of hair within only six weeks. The petitioner stated that because of such a promotion, he bought two bottles of lotion from A-one Medicals. Despite doing this for 7 weeks, he did not see any growth in his hair. He subsequently filed a claim with the district commission for damages of Rs. 500,000 for losses, pain, and emotional pain.

Held: The Commission came to the conclusion that the claimant was convinced by the commercial to purchase the cream and apply it in accordance with the instructions specified in the advertising, but she did not obtain the outcomes that the advertising claimed. Because of this, the Commission found a service defect and directed the accused to compensate the claim.

Horlicks Ltd. Vs. Zydus Wellness Products Ltd.

In this context, Horlicks asserts that it will be proven by science to boost children’s growth, stamina, and mental focus. Horlicks is a product of Hindustan Unilever which distributes wellness foods and beverages across India. On another side, there is a claim regarding a milk powder energy beverage made by Zydus Wellness Products Limited.

One drink of Complaint is equal to two drinks of Horlicks, according to a Zydus commercial that was broadcast. Horlicks file a claim in the Delhi HC asking for a permanent injunction preventing Zydus Wellness Products from publishing the controversial TVC. Because the advertising deceived or misled the public, the Court imposed an interim order prohibiting Zydus Company from showing the advertisement.

The way forward

Given the progression of laws, misleading advertising is becoming more common in India. To fully describe the comprehension, check, and medical component of deceptive advertising in India, administration specialists and oneself must conduct a complete analysis of the relevant statutes, case law, and administrative procedures. The Department of Consumer Affairs has partnered with the Advertising Standard Council of India and recognised it for its work in addressing complaints against misleading commercials on the Complaint Against Misrepresentative Advertisements platform.

The traditional means of advertising are changing swiftly due to the growing importance of the internet, mobile devices, and modern media. Therefore, any legislation about marketing would need to make sure that it tended to the changing dynamics of advertising and obliged the needs of the potent contemporary communication channels.

On this subject, there isn’t a single legislation, however, there are “too many laws” in each industry. Accordingly, we think the industry immediately requires legislators to combine such laws and law enforcement organisations into “one legal” body.

Conclusion

There are several regulations against deceptive advertising in the law. However, in actuality or the unpleasant reality, it is not so efficient. Since the art of lies and misinformation is becoming more sophisticated every day and is thus visible through deceptive advertising, individuals with the ulterior motive of increasing their financial gain or profit trample on consumers’ interests or rights by offering them only the most basic information about a product. More than ever, creating a single legal system to control advertising is crucial. It is envisaged that the central government will hear the parliamentary branch’s demands for the earliest possible enactment of these advertising rules.

References

• Rashmi Jha, Law against false advertisements, Available at: https://blog-ipleaders-in.cdn.ampproject.org/v/s/blog.ipleaders.in/laws-false-advertisement/ (Accessed: November 28, 2022).
• Srishti Prakash, Consumer Protection Act, 2019 – Restraining false and misleading advertisements, Available at: https://www.legalserviceindia.com/legal/article-4708-consumer-protection-act-2019-restraining-false-and-misleading-advertisements.html (Accessed: November 28, 2022).
• Meghana Prashant Naik, False and Misleading Advertisements under Consumer Protection Act, 2019, Available at: https://lawcorner.in/false-or-misleading-advertisements-under-consumer-protection-act-2019/ (Accessed: November 28, 2022).