Law relating to unfair trade practices
Definition:
An unfair trade practice means a trade practice, which, for the purpose of promoting any sale, use or supply of any goods or services, adopts unfair method, or unfair or deceptive practice. Unfair practices may be categorised as under:
1. FALSE REPRESENTATION
The practice of making any oral or written statement or representation which: * Falsely suggests that the goods are of a particular standard quality, quantity, grade, composition, style or model; * Falsely suggests that the services are of a particular standard, quantity or grade; * Falsely suggests any re-built, second-hand renovated, reconditioned or old goods as new goods; * Represents that the goods or services have sponsorship, approval, performance, characteristics, accessories, uses or benefits which they do not have; * Represents that the seller or the supplier has a sponsorship or approval or affiliation which he does not have; * Makes a false or misleading representation concerning the need for, or the usefulness of, any goods or services; * Gives any warranty or guarantee of the performance, efficacy or length of life of the goods, that is not based on an adequate or proper test; * Makes to the public a representation in the form that purports to be- * *# a warranty or guarantee of the goods or services, a promise to replace, maintain or repair the goods until it has achieved a specified result, if such representation is materially misleading or there is no reasonable prospect that such warranty, guarantee or promise will be fulfilled * Materially misleads about the prices at which such goods or services are available in the market; or * Gives false or misleading facts disparaging the goods, services or trade of another person.

2.FALSE OFFER OF BARGAIN PRICE Where an advertisement is published in a newspaper or otherwise, whereby goods or services are offered at a bargain price when in fact there is no intention that the same may be offered at that price, for a reasonable period or reasonable quantity, it shall amount to an unfair trade practice.

The 'bargain price', for this purpose means-

1. the price stated in the advertisement in such manner as suggests that it is lesser than the ordinary price, or 2. the price which any person coming across the advertisement would believe to be better than the price at which such goods are ordinarily sold.
FREE GIFTS OFFER AND PRIZE SCHEMES The unfair trade practices under this category are: * Offering any gifts, prizes or other items along with the goods when the real intention is different, or * Creating impression that something is being offered free alongwith the goods, when in fact the price is wholly or partly covered by the price of the article sold, or * Offering some prizes to the buyers by the conduct of any contest, lottery or game of chance or skill, with real intention to promote sales or business.
4.NON-COMPLIANCE OF PRESCRIBED STANDARDS
Any sale or supply of goods, for use by consumers, knowing or having reason to believe that the goods do not comply with the standards prescribed by some competent authority, in relation to their performance, composition, contents, design, construction, finishing or packing, as are necessary to prevent or reduce the risk of injury to the person using such goods, shall amount to an unfair trade practice.
5.HOARDING, DESTRUCTION, ETC.
Any practice that permits the hoarding or destruction of goods, or refusal to sell the goods or provide any services, with an intention to raise the cost of those or other similar goods or services, shall be an unfair trade practice.
INQUIRY INTO UNFAIR TRADE PRACTICES
The Commission may inquire into any unfair trade practice * Upon receiving a complaint from any trade association, consumer or a registered consumer association, or * Upon reference made to it by the Central Government or State Government * Upon an application to it by the Director General or * Upon its own knowledge or information.
RELIEF AVAILABLE
After making an inquiry into the unfair trade practice if the Commission is of the opinion that the practice is prejudicial to the public interest, or to the interest of any consumer it may direct that - * The practice shall be discontinued or shall not be repeated; * The agreement relating thereto shall be void in respect of such unfair trade practice or shall stand modified. * Any information, statement or advertisement relating to such unfair trade practice shall be disclosed, issued or published as may be specified * The Commission may permit the party to carry on any trade practice to take steps to ensure that it is no longer prejudicial to the public interest or to the interest of the consumer. However no order shall be made in respect a trade practice which is expressly authorised by any law in force.
The Commission is empowered to direct publication of corrective advertisement and disclosure of additional information while passing orders relating to unfair trade practices.
-------------------------------------------------

Consumer Goods (Mandatory Printing of Cost of Production and Maximum Retail Price) Act, 2006
-------------------------------------------------

Consumer Protection Act, 1986
The Consumer Protection Act establishes a hierarchy of courts, with at least one District Forum at the district level, a State Commission at the State capitals and the National Commission at New Delhi. The pecuniary jurisdiction of the District Forum is up to Rs. one lakh and that of the State Commission is above Rs. one lakh and below Rs. 10 lakhs. All claims involving more than Rs. 10 lakhs are filed directly before the National Commission. Appeals from the District Forum are to be filed before the State Commission and from there to the National Commission, within thirty days of knowledge of the order. Under the Act, a consumer or any registered voluntary consumer association or any Central or State Government can make a complaint. A "consumer" is a person who buys any goods or hires any service for consideration, paid or promised or partly paid or under deferred payment. This includes any user of such goods or services when such use is made with the approval of the person who paid or partly paid etc. However, goods obtained for commercial purposes or for resale are not covered under the Act.
Complaints can be made against (a) unfair trade practices by which complainants suffer loss or damage; (b) goods that suffer from one or more defects; or (c) deficient service.

The procedure adopted by the Forum or Commission on receipt of a complaint is to refer a copy of the complaint to the Opposite Party directing them to file their version within thirty days or such extended period not exceeding fifteen days at a time. The Forum or Commission has the powers vested in a civil court and these include the power to summon and examine witnesses, requisition reports of analysis or tests from appropriate laboratories and to receive evidence by way of affidavits. Based on its findings, the Forum or Commission can grant a direction to the Opposite Party to remove the defect, replace the goods free of defect, or refund the charges paid for the goods or service and to pay compensation for the loss or injury suffered by the complainant. Such directions are to be treated as if it was a decree of a court, and non-compliance can amount to imprisonment
Essential Commodities Act: Any complaint of hoarding or unfair trade practice against the thirty-four commodities listed as essential commodities under this Act can be preferred to the special courts established under the Act.
Standards of Weights and Measures Act and Rules: This Act prescribes standards for the weights and measures used in trade. These standards ought to be certified by the Bureau of Indian Standards (BIS) and contain the "ISI" mark. This also prescribes rules for packaged commodities. The rules explain the details that a package should contain - like the maximum retail price (MRP), weight of the commodity, date of manufacture and expiry.
MRTP Act: This Act establishes a Central Commission to initiate suomotu action against restrictive and unfair trade practices and also to hear and pass orders on complaints. The aim of the Act is to stop any trade practice that may have the effect of preventing, distorting or restricting competition or causes loss or injury to consumers.
Prevention of Food Adulteration Act: This Act contains stringent provisions against adulterators of food articles. The Act also prescribes a set of officers to check the quality and quantity of food in public establishments.
Drugs and Cosmetics Act: This Act prescribes officers to enforce its various provisions and also prescribes stringent action against manufacturers of drugs and cosmetics for violations under this Act.
Competition Act, 2002:
Conclusion: All such legislations and rules would become effective if consumers know their rights and duties and perform accordingly.

Consumers Right 1. Right to Safety: To be protected against the sale of goods and services which are spurious/hazardous to life. 2. Right to information: To know the quality, quantity, weight and the price of goods/services being paid for, so that you are not cheated by unfair trade practices. 3. Right to choose: To be assured wherever possible, access to a variety of goods and services at a competitive price. 4. Right to be heard: To be heard and be assured that your interest will receive due consideration at appropriate fora. 5. Right to Seek Redressal: To seek legal redressal against unfair or restrictive trade practices or exploitation. 6. Right to Consumer Education: To have access to consumer education.
Consumers Responsibilities 1) Obtain full information regarding quality and price before making any purchases. 2) Be careful, about false and /or misleading advertisement 3) Purchase goods having quality marks like ISI/Agmark etc. as and where available, for safety and quality. 4) Obtain proper receipt/cash memo for purchases made and guarantee/warranty card duly stamped and signed by the seller, wherever applicable. 5) Approach Consumer Forum for redressal of consumer grievances against sale of defective goods or deficient services or adoption of unfair restrictive trade practices.
Precautions for Consumers: 1. Purchase only when you need and do not purchase in a hurry. 2. Do not buy blindly. Demand full information before you buy. 3. Beware of false/misleading advertisements. 4. Do not compromise on the quality of goods and services and its quality. Purchase only quality products. 5. Do not forget to obtain proper receipt/cash memo. Always obtain the guarantee/warranty card duly stamped and signed by the shopkeeper, wherever necessary. These can be helpful in consumer courts

The Ministry of Corporate Affairs, Government of India has issued a Notification dated 28th August 2009, By a notification No. S.O. 2204(E), dated August 28, 2009 issued by the Ministry of Corporate Affairs, whereby the most controversial the Monopolies and Restrictive Trade Practices Act, 1969 (“the MRTP Act”) stands repealed and is replaced by the Competition Act, 2002, with effect from September 1, 2009.
The MRTP Commission will continue to handle all the old cases filed prior to September 1, 2009 for a period of 2 years. It will, however, not entertain any new cases from now onwards.
Subject Transitional Provisions – the MRTP Act, 1969 to the Competition Act, 2002 w.e.f. September 1, 2009)
The Ministry of Corporate Affairs, Government of India has issued a Notification dated 28th August 2009, whereby the most controversial the Monopolies and Restrictive Trade Practices Act, 1969 (“the MRTP Act”) stands repealed and is replaced by the Competition Act, 2002, with effect from September 1, 2009.
The following transitional provisions would apply as provided in Section 66 of the Competition Act, 2002:-
1. MRTP Commission
a) The MRTP Commission will continue to exercise jurisdiction and power under the repealed MRTP Act in respect of any case or proceeding filed before 1 September 2009, for a period of two years. It will not, however entertain any new case arising under the MRTP Act on or after 1 September 2009.
b) Upon the expiry of the specified two year period, the MRTP Commission shall stand dissolved.
2. Transfer of pending cases
Upon the expiry of two years from 1 September 2009, cases pending before the MRTP Commission will be transferred as follows:-
a) Monopolistic or restrictive trade practice cases: All pending cases pertaining to monopolistic or restrictive trade practices, including cases having an element of unfair trade practice, shall stand transferred to the Competition Appellate Tribunal, which shall adjudicate such cases in accordance with the provisions of the repealed MRTP Act.
b) Unfair trade practice cases: All pending cases relating solely to unfair trade practices shall stand transferred to the National Commission as constituted under the Consumer Protection Act, 1986, which may in turn transfer such cases to a State Commission constituted under the said Act under circumstances it deems appropriate. These cases will be dealt with by them in accordance with the provisions of the Consumer Protection Act.

c) Cases relating to giving false or misleading facts disparaging the goods, services or trade of another person under the MRTP Act: All such pending cases shall be transferred to the Competition Appellate Tribunal which will be dealt in accordance with the provisions of repealed MRTP Act.
3. Investigations/proceedings undertaken by the Director General under the MRTP Act
With effect from 1 September 2009, all pending investigations and proceedings by the Director General relating to:-
a) Monopolistic/ restrictive trade practices will be transferred to the Competition Commission of India (CCI), who may conduct such investigations/ proceedings in any manner it deems appropriate.
b) Unfair trade practices will be transferred to the National Commission under the Consumer Protection) Act 1986.
c) Cases giving false or misleading facts disparaging the goods, services or trade of another person will be transferred to the CCI.