General Meaning of Advertisement:
Advertisements are a mode of communication between the manufacturers and the
consumers. It is an age-old method which is used in every country to generate
certain ideas in the minds of the viewers so that they can be persuaded to
purchase the product or avail those services. These communications can be made
through print media like newspapers, magazines, books, posters, hoardings,
broadcast media like radios, televisions and internet media that includes social
media and websites.
Some forms of advertisements have been present all over the world for centuries
together. In England the advertisements were in the form of notices related to
births, deaths, marriages, ship timings, employment and such similar issues in
the printed newspapers. In India, advertisements started in the eighteenth
century with Bengal Gazette as it was India's first newspaper.
nineteenth century as trade and commerce flourished the trend of advertising
products was initiated in India that increased the number of advertisements
being published in newspapers and magazines. The twentieth century saw the field
of advertising flourishing with the advent of television, radios, cinemas,
internet and commercialisation of brand products. This industry has witnessed a
revolution that led to transformation of advertising and hence till date
continues seeing perennially dynamic changes.
Laws to curb misleading advertisements:
Over a period of time, as the competition became keen, for better acceptability
and selling of their products, some advertisements started misleading and
misguiding the viewers. To rein in this form of misleading advertisements
various laws were made, such as, The Drugs and Magic Remedies (Objectionable
Advertisements) Act, 1954. However, the Act was quite outdated related to
misleading advertisements and other issues that were being faced and
additionally the law did not recommend any heavy penalties or imprisonment.
Monopolies and Restrictive Trade Practices Act, 1969 according to which
providing false information regarding goods and services was considered to be a
part of “unfair trade practices”. The Consumer Protection Act, 1986 provided
that any false representation of goods or services will be treated as unfair
The Cable Television Network Regulation Act and Rule, 1995
lacked any enforcing agency and Food Safety and Standards Act, 2006 mentioned
about misleading advertisements but did not talk about corrective
advertisements. Despite these abovementioned Acts, none of them spoke about
deterrents or penalties to be implied on the makers or the promoters of these
Therefore, a dire need was felt to introduce The Consumer Protection Act, 2019,
repealing The Consumer Protection Act, 1986, which imposes penalties on the
manufacturers and endorsers of such advertisements. Provisions like the
definition of the misleading advertisements got notified on 15th July, 2020 and
came into effect on 20th July, 2020. Some of the other provisions such as
Central Consumer Protection Authority and the penalties under Chapter III got
notified on 23rd July, 2020 and came into effect on 24th July, 2020.
Consumer Protection Act, 2019 provisions on misleading advertisements:Section 2(28):
defines misleading advertisements as any advertisement in
relation to any product or service which:
- Falsely describes such product or services or
- It gives a false guarantee to, or is likely to mislead the consumers as
to the nature, substance, quantity or quality of such product or services or
- It conveys an express or implied representation which, if made by the
manufacturer or seller or services provider thereof, would constitute an
unfair trade practices or
- Deliberately conceals important information.
Section 10- establishment of Central Consumer Protection Authority to be known
as the Central Authority to regulate matters relating to violation of rights of
consumers, unfair trade practices and false or misleading advertisements which
are prejudicial to the interest of pubic and consumers and to promote, protect
and enforce the rights of consumers as a class.
Section 16- power of District Collector (by whatever name called) may, on a
complaint or on a reference made to him by the Central Authority or the
Commissioner of a regional office, inquire into or investigate complaints
regarding violation of rights of consumers as a class, on matters relating to
violation of consumer rights, unfair trade practices and false or misleading
advertisements, within his jurisdiction and submit his report to the Central
Authority or the Commissioner of a regional office, as the case may be.
complaints to authorities relating to violation of consumer rights
or unfair trade practices or false or misleading advertisements which are
prejudicial to the interest of consumers as a class, may be forwarded either in
writing or in electronic mode, to any one of the authorities, namely, the
District Collector or the Commissioner of a regional office or the Central
power of Central Authority is to ensures that no false or
misleading advertisements is made of any goods or services which contravenes the
provisions of this Act or the rules or regulations made there under; and section
18(1)(d) ensures that no person takes part in the publication of any
advertisements which is false or misleading.
power of Central Authority to refer to matter for investigation
or to other Regulator may, after receiving any information or complaint or
directions from the Central Government or of its own motion, conduct or cause to
be conducted a preliminary inquiry as to whether there exists a prima facie case
of violation of consumer rights or any unfair trade practices or false or
misleading advertisements, by any person, which is prejudicial to the public
interest or to the interests of consumers and if it is satisfied that there
exists a prima facie case, it shall cause investigation to be made by the
District- General or by the District Collector.
Powers to Central Authority to issue directions and penalties
against any false or misleading advertisements:
- Where the Central Authority is satisfied after investigation that any
advertisements is false or misleading and is prejudicial to the interest of
any consumer or is in contravention of consumer rights, it may, by order,
issue directions to the concerned trader or manufacturer or endorser or
advertiser or publisher, as the case may be, to discontinue such
advertisement or to modify the same in such manner and within such time as
may be specified in that order.
- Notwithstanding the order passed under sub-section (1), if the Central
Authority is of the opinion that it is necessary to impose a penalty in
respect of such false or misleading advertisement, by a manufacturer or an
endorser, it may, by order, impose on manufacturer or endorser a penalty
which may extend to ten lakh rupees:
Provided that the Central Authority may, for every subsequent contravention
by a manufacturer or endorser, impose a penalty, which may extend to fifty
- Notwithstanding any order under sub-sections (1) and (2), where the
Central Authority deems it necessary, it may, by order, prohibit the
endorser of a false or misleading advertisement from making endorsement of
any product or service for a period which may extend to one year:
Provided that the Central Authority may, for every subsequent contravention,
prohibit such endorser from making endorsement in respect of any product or
service for a period which may extend to three years.
- Where the Central Authority is satisfied after investigation that any
person is found to publish, or is a party to the publication of, a
misleading advertisement, it may impose on such person a penalty which may
extend to ten lakh rupees.
- No endorser shall be liable to a penalty under sub-sections (2) and (3)
if he has exercised due diligence to verify the veracity of the claims made
in the advertisement regarding the product or service being endorsed by him.
- No person shall be liable to such penalty if he proves that he had
published or arranged for the publication of such advertisement in the
ordinary course of his business: Provided that no such defence shall be available to such
person if he had previous knowledge of the order passed by the Central Authority
for withdrawal or modification of such advertisement.
- While determining the penalty under this section, regard shall be had to
the following, namely:
- the population and the area impacted or affected by such offence;
- the frequency and duration of such offence;
- the vulnerability of the class of persons likely to be adversely
affected by such offence; and
- the gross revenue from the sales effected by virtue of such offence.
- The Central Authority shall give the person an opportunity of being
heard before an order under this section is passed.
Section 39(1)(l)- findings of District Commission is to issue corrective
advertisement to neutralise the effect of misleading advertisement at the cost
of the opposite party responsible for issuing such misleading advertisement;
(m) to provide for adequate costs to the parties; and
(n) to cease and desist from issuing any misleading advertisement.
Section 89- punishment for false or misleading advertisement is that Any
manufacturer or service provider who causes a false or misleading advertisement
to be made which is prejudicial to the interest of consumers shall be punished
with imprisonment for a term which may extend to two years and with fine which
may extend to ten lakh rupees; and for every subsequent offence, be punished
with imprisonment for a term which may extend to five years and with fine which
may extend to fifty lakh rupees.
Comparison between Consumer Protection Act, 1986 and 2019:
Consumer Protection Act, 1986 provided with “unfair trade practices” under
section 2r as 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 deceptive practice including making a false or misleading
representation concerning the need for, or the usefulness of, any goods or
Moreover, section 14(hc) states that corrective advertisements should be issued
to neutralize the effect of misleading advertisement at the cost of opposite
party responsible for issuing such misleading advertisement.
However, in the 2019 Act, there is a clearer definition of advertisements under
section 2(1) encompassing all forms of ‘audio or visual publicity,
representation, endorsement or pronouncement made by means of lights, sound,
smoke, gas, print, electronic media, internet or website and includes any
notice, circular, label, wrapper, invoice or such other documents.' An explicit
meaning has been given to misleading advertisement under section 2(28) along
with establishment of Central Consumer Protection Authority, under section 10,
that would be regulating matters relating to violation of rights of consumers,
unfair trade practices and false and misleading advertisement.
A Director- General or District Collector shall be appointed by the Central
Government as the head of the Investigation Wing. Furthermore, section 21
imposes penalties on the manufacturer or the endorser for manufacturing or
endorsing any advertisement that violates the interests of the consumers'
Thus, with the usage of the term ‘misleading advertisements' instead of ‘unfair
trade practices' it becomes easier to categorically name the dubious and
ill-intentioned advertisements so that action can be taken against the offender.
A separate Central Consumer Protection Authority establishment to investigate,
hold inquiry, produce evidence and deal with misleading advertisers and
advertisements can assure efficiency and efficacy in dealing with matters
related to false and misleading advertisements.
- http://egazette.nic.in/WriteReadData/2019/210422.pdf- Consumer
Protection Act, 2019.
Award Winning Article Is Written By: Ms.Srishti Prakash
Authentication No: FB105421366606-23-221