Introduction
Advertisement is a mode or a medium that is used to convey information regarding one’s product or service in a market. The motive behind an advertisement is to bring a product or a service circulating or bring a newly launched product or service to the market. Consumerism is a developing culture in a modern corporate world and advertisements play a crucial role in this system. Advertisement is nothing but a way to inform the public at large about the seller’s product or service or idea prevailing in the market. Such advertisement encourages the buyer or public to buy the product or service or the idea.
Advertisement is a way by which a manufacturer or a seller needs to inform consumers about the nature, quality, characteristics of a particular product or a service provided or offered by them in the market. But instead of giving mere information about the product, sometimes it acts as an art of disinformation by misleading the consumer about such a product, service, or idea offered.
False or Misleading Advertisement
Due to competitive pressure and in a hurdle race of success, advertisement has just become the mode of grabbing consumers’ attention with an intent to increase the supply and a yearly turnover of the companies nowadays. Such pressure is too high to think about what is wrong and what is right. To think about what is good or bad for a customer. At such a stage the manufacturer or the seller or the service provider can go to any extent to sell their products to customers. Where even a bad product is misled to be good and sold to the customers. This is done through advertisement which influences the consumers with fantastical images rather than the grim reality of the productive process of such products.
When does an advertisement become false or misleading?
An aim or motive behind advertising is to convey all the information regarding a particular product that is circulating in the market or newly launched in the market.
An advertisement is termed to be misleading when it misleads the consumer by misrepresenting their products or services and by making false statements regarding it.
For example:
- When a shampoo company influences consumers that their products prevent hair fall or dandruff issues by just one wash then such statements are false and misleading ones.
- When a product is of a soft drink which shows that one can get energy after consuming it, that one can face any danger, might even jump from a height and be survived is a dangerous and misleading one.
- A facial cream which guarantees that whoever applies it will get a fair skin tone within 365 days is, therefore, a misleading advertisement.
Does Misleading Advertisement Amount to an Offence?
As the objective of an advertisement is to communicate a message or information regarding the particular product, service or idea, and therefore misleading it could cause harm to the consumer who gets influenced by such advertisement and consumes it.
Such misleading advertisements which cause harm to the consumer are offensive in nature. As the seller just with the intent to earn profit causes harm to the buyer and sometimes threatens its right to life. Misleading advertisement in fact violates several rights of a consumer be it right to be informed, right to choose, right to be protected against unsafe goods and services as well as unfair trade practices, which in turn makes it offensive by nature. And such misleading advertisements can be further objectionable in the court of law.
There are various laws and regulations which protect the consumer from such false statements and prohibit misleading advertisements. One of the laws which were enacted to provide protection and quick redressal for consumers was Consumer Protection Act, 2019. Which was passed in 1986 and a recent amendment to the act was done in 2019.
Misleading Advertisement under Consumer Protection Act, 2019
Consumer Protection Act, 2019 protects the basic rights of consumers and seeks a quick and fast redressal to the consumers. It protects the rights such as the right against the marketing of goods and services which are hazardous to life and property, right to be informed about the quality, quantity, potency, purity, standard and price of goods or services.
Consumer Protection Act, 2019 acts as an exception to the rule of caveat emptor and protects the consumer’s right from misrepresentation or false statements or misleading advertisements.
1. Defining “False Or Misleading Advertisements” Under Consumer Protection Act, 2019
Section 2(28), of the Consumer Protection Act, 2019, defines misleading advertisements in relation to any product or service. So according to this section misleading advertisement means an advertisement which falsely describes any such product or service; which gives a false guarantee upon the product or service by misleading upon its nature, substance, quality, the quantity, And deliberately conceals important information.
2. Authority Dealing With Misleading Advertisements Under Consumer Protection Act, 2019
Under Section 10 of the Act, The Central Consumer Protection Authority known as the Central Authority is being established in order to regulate the matters relating to misleading advertisements which violate the consumer’s rights.
Further, the District Collector has also been given power under Sction 16, of the Act, 2019, whereby on receiving complaints or by reference made by Central Authority may inquire or investigate into the complaints regarding false or misleading advertisements.
When a consumer’s right is violated by misleading him or making a false statement to him by a seller may complain about the same either in writing or in electronic mode to any one of the authorities be it The District Collector or The Central Authority.
Central Authority On Misleading Advertisement.
The established Central Consumer Protection Authority also known as Central Authority has inherited powers and functions under Section 18, of the Consumer Protection Act, 2019. Where acting upon those ensures that no false or misleading advertisement is done of any goods or services which violates the consumer’s rights.
The Central Authority has also been procured power under Section 19, of the Act, 2019, whereupon receiving a complaint or information or direction by the central government has the power to conduct an inquiry to see whether there exists Prima Facie case of false or misleading advertisement. If it is satisfied that there exists any Prima Facie case, it causes the District Collector to investigate such matters.
Further, under Section 21, Consumer Protection Act,2019, Central Authority has been given the power to issue directions and penalties against false or misleading advertisements.
The following are the powers given to the Central Authority under Section 21:
1. Under this section, if the central authority after investigation, finds that there is any false or misleading advertisement circulating or is being run in the market then it may issue an order or directions against any such trader, manufacturer, advertiser, endorser or a publisher, to discontinue such advertisement affecting the interest of consumer’s rights and modify the same in a manner prescribed in such order or directions issued.
2. Central Authority has the power to impose a penalty in respect of false or misleading advertisements under this section, which may be extended to Rs.10 lakhs.
3. Under this section central authority may by order prohibit the misleading advertisement of any product or service for a period which may extend to one year.
4. If the Central Authority after investigation finds that any person who published or is a party to the publication of the misleading advertisement, it may impose a penalty on such person which may extend to Rs. 10 Lakhs.
Exceptions:
1. As per Section 21, of the act, no endorser will be made liable if he exercises carefully to verify the accuracy of the claims made in the advertisement regarding his products or services.
2. No seller or manufacturer shall be liable if publication of such advertisement was made in the ordinary course of his business. This defense or exception is not applicable in cases where the seller or manufacturer or publisher or any person in such context, had received an order by the authority for withdrawal or modification of such advertisement.
Determination of penalty under Section 21.
While determining the penalty under Section 21, of the Consumer Protection Act, 2019, the consent authority must give regard to the following factors:
1. Firstly, the consent authority must see the population and the area impacted or affected by such an offence.
2. Secondly, the consent authority must see the frequency and duration of such an offence.
3. Thirdly, the consent authority must give regard to the vulnerability of the class of persons, who are likely to be adversely affected by such an offence.
4. Lastly, the consent authority shall give regard to the gross revenue from the sales effected by virtue of such offences.
If any person fails to comply with any orders or any directions issued by The Central Authority shall be punished with imprisonment which may extend to 6 months or with a fine which may extend to 20 Lakhs of Rs. or both.
If a person is aggrieved by any order passed by The Central Authority may appeal to The National Commission against the order within 30 days of receipt of such order.
The District Collector On Misleading Advertisement.
The District Collector after investigation finds any person publishing or endorsing a false or misleading advertisement may issue an order under Section 39 (1)(l), of the Act,2019, to correct the advertisement so as to neutralize the effect of such misleading advertisement.
Under Section 39(1)(l), of the Act, 2019, The District Collector may issue an order to provide adequate costs to the parties. The District Collector may under Section 39 (1)(l), cease or deceit from issuing any misleading advertisement.
3. Punishment For Misleading Advertisement Under Consumer Protection Act, 2019
Any person be it a seller or manufacturer or endorser or publisher if causes a false or misleading advertisement which causes harm to the interest of the consumers shall be punished under Section 89, of The Consumer Protection Act, 2019, with imprisonment which may extend to 2 years and with fine which may extend to Rs. 10 Lakhs.
Judicial Verdict On Misleading Advertisement
1. Francis Vadakkan Vs. The Propreitor, A-One Medicals &ors.
This is the recent case held on 22nd January 2021. In this case, before the Kerala District Commission, the defendant is a manufacturer of a hair growth cream where it had published an advertisement where it claimed that with the use of their hair cream, the hair will grow 3 folds in 6 weeks. The complainant before the commission said that he was influenced by such advertisements and purchased the cream twice from A-one Medicals. He used it for 7 weeks, but his hair didn’t grow. So he approached the district Commission claiming Rs. 500,000 for loss, injury and mental agony.
Held: Commission found that the complainant was influenced by the advertisement to purchase the cream and used it according to the directions shown in the advertisement, but didn’t get the outcome which was guaranteed through advertisement. Therefore The Commission found a deficiency in the service and directed the defendant to compensate the complainant.
2. Horlicks Ltd. Vs. Zydus Wellness Products Ltd.
In this case, Horlicks which is one of the brands of Hindustan Unilever in the health food drinks available in India, which claims to have been clinically proven to make kids taller, stronger and sharper. On other hand, there is a complaint, which is a powdered milk energy drink owned by the brand Zydus Wellness Products Limited.
The Zydus aired an advertisement and declared that one cup of complaint was equivalent to two cups of Horlicks. A suit was filed in the Delhi High Court by Horlicks seeking a permanent injunction prohibiting Zydus Wellness Products from arising the disputed TVC.
Held: High court passed an interim order restraining the Zydus Company from arising its commercial, as such commercial advertisement was a misleading or misrepresenting one.
Conclusion
As there are various provisions incurred into the law against misleading advertisement. But in practical or in the bitter truth of reality it is not that effective. People with a greedy motive to earn more money or profit take away the interest or rights of consumers placing them in a pitch of just mere information of a product as the art of disinformation is growing day by day and thus can be witnessed through misleading advertisement.
References
1. https://cutscart.org/pdf/Study_on_the_Status_of_Law_Enforcement_for_Misleading_
Advertisements_in_India.pdf
2. http://www.thelexrepository.com/misleading-advertisement-horlicks-ltd-vs-zydus/
3. https://egazette.nic.in/WriteReadData/2019/210422.pdf
4. https://consumeraffairs.nic.in/sites/default/files/file-uploads/misleading-advertisements/misleading_advertiesment_and_consumer%20%281%29_0.pdf
This article has been written by Meghana Prashant Naik, 4th Year BA. LL.B student at V.M Salgaocar College Of Law
