2025 INSC 593 1

REPORTABLE IN THE SUPREME COURT OF INDIA

ORIGINAL/CIVIL APPELLATE JURISDICTION

WRIT PETITION (CIVIL) NO. 282 OF 2021

RUTU MI HIR PANCHAL & ORS. ...PETITIONER(S)

VERSUS

UNION OF INDIA & ORS. …RESPONDENT(S)

WITH

CIVIL APPEAL NO. OF 2025

ARISING OUT OF SLP (C) No. 1738 OF 2022

J U D G M E N T

PAMIDIGHANTAM SRI NARASIMHA, J.

Table of Contents

1. Facts in the Writ Petition: .......................................................................... 2

2. Facts in the Civil Appeal ............................................................................. 3

3. Statutory Provisions: .................................................................................... 4

4. Submissions..................................................................................................... 6

5. Analysis ............................................................................................................ 8

6. Re: Power to determine pecuniary jurisdiction ................................... 9

7. Re: Submissions that the provisions are discriminatory and

violative of Article 14 ................................................................................. 11

8. Re: Performance Audit of the Statute ................................................... 17

9. Conclusions ..................................................................................................... 28

2

1. Constitutionality of Sections 34(1), 47(1)(a)(i) and 58(1)(a)(i)

of the Consumer Protection Act, 20 19

1 prescribing pecuniary

jurisdictions of the district, state and n ational commissions on the

basis of value of goods and services paid as consideration , instead

of compensation claimed are challenged in the writ petition

2 under

Article 32 of the Constitution and the c ivil appeal

3 against the

order of the National Consumer Disputes Redressal Commission

4.

2. Facts in the Writ Petition : The short facts, to the extent that

they are relevant for disposal of the writ petition are that the

petitioner’s husband purchased a sedan –Ford Endeavour Titanium

car from S.P. Vehicles Pvt. Ltd., authorised dealer of Ford India for

an amount of Rs. 31.19 Lakhs. Tragically, the vehicle caught fire

on 20.11.2018 while being driven leading to death of petitioner’ s

husband. Though criminal proceedings were initiated, the present

proceedings are concerned with the statutory proceedings initiated

under the 2019 Act by way of c onsumer complaint before the

District Consumer Commission, Vadodara for compensation of Rs.

51.49 crores with interest thereon. Pending disposal of the

1

Hereinafter referred to as the 2019 Act.

2

W.P. (C) No. 282 of 2021.

3

Leave Granted and arising out of SLP (C) No. 1738 of 2022 against the order of the National

Consumer Disputes Redressal Commission in Diary No. 19172/NCDRC/2021- CC dated

08.10.2021.

4

Hereinafter, “National Commission”.

3

consumer complaint, the appellant approached this Court by way

of the present writ petition under Article 32 of the Constitution

alleging that she was compelled to approach the d istrict

commission because of the statutory regime under the 2019 Act ,

whereas under the repealed Consumer Protection Act, 1986

5, she

could have directly approached the national commission based on

compensation claimed. The relevant portion of the prayer made in

the writ petition is as follows:

“a) Be pleased to issue appropriate guidelines, Writ in the nature

of Mandamus or such other Writ or declaration or directions to

declare that newly added Proviso of Section 34(1), Proviso to

Section 47(1) and Proviso to Section 58(1 )(a)(i) of the Consumer

Protection Act, 2019 directing that for Pecuniary Jurisdiction

instead of "Compensation Claimed", the "consideration paid at

the time of purchase of Services" will be applicable as quoted in

Para 2.1, 2.2, 2.3, as violative of Article 14 of the Constitution of

India on the ground of Arbitrariness and contrary for the purpose

of hierarchy of Judicial System in India.

b)…..”

3. Facts in the Civil Appeal: In the civil appeal, the appellant’s

husband, a District governor of the Lions Club of Jhansi, passed

away due to COVID-19 on 25.07.2020. When her claim on the

basis of insurance policy offered by Lions International Club, up

to two million dollars as compensation to families of deceased

members was denied, she approached the n ational commission

seeking Rs. 14.94 crore. However, the national commission

5

Act No. 68 of 1986. Hereinafter, “1986 Act”.

4

rejected her petition on the ground that the consideration for the

insurance policy does not exceed Rs.10 crores. The relevant

portion of the order passed by the national commission is

reproduced hereinbelow for ready reference;

“…

The Pecuniary Jurisdiction has been specified in the

Consumer Protection Act, 2019, where the consideration paid, if

exceeds Rupees Ten Crores, will give power to the National

Consumer Disputes Redressal Commission to entertain any

Complaint. It has nothing to do with the amount of Compensation

to be claimed by any of the Complainant

. ”

4. Statutory Provisions: Before we consider the legal

submissions of the petitioner/ appellant and the respondent, a

comparative chart of the jurisdictions exercised by the d istrict,

state and n ational commission under the repealed 1986 Act and

the present 2019 Act is as follows:

FORUM 1986 ACT 2019 ACT

District

Commission

Section 11.(1) Subject to

the other provisions of this

Act, the District Forum

shall have jurisdiction to

entertain complaints where

the value of the goods or

services and the

compensation, if any,

Section 34.(1) Subject to

the other provisions of this Act, the District

Commission

shall have

jurisdiction to entertain

complaints where the

value of the goods or

services paid as

5

claimed does not exceed

rupees twenty lakhs…

consideration does not

exceed one crore rupees…

State

Commission

Section 17. Subject to the

other provisions of this Act,

the State Commission shall

have jurisdiction— (a) to

entertain — (i) complaints

where the value of the

goods or services and

compensation, if any,

claimed exceeds rupees

twenty lakhs but does not

exceed rupees one crore…

Section 47. (1) Subject to

the other provisions of this Act, the State Commission

shall have jurisdiction —

(a) to entertain — (i)

complaints

where the

value of the goods or

services paid as

consideration, exceeds

rupees one crore, but does

not exceed rupees ten

crore...

National

Commission

Section 21. Subject to the

other provisions of this Act, the National Commission

shall have jurisdiction —

(a) to entertain— (i)

complaints where the value

of the goods or services and

compensation, if any,

claimed exceeds rupees

one crore…

Section 58. (1) Subject to

the other provisions of this

Act, the National

Commission

shall have

jurisdiction — (a) to

entertain — (i) complaints

where the value of the

goods or services paid as

consideration exceeds

rupees ten crore…

6

4.1 A plain and simple reading of the provisions makes it clear

that the 2019 Act shifts the basis of the pecuniary jurisdiction of

the district, state as well as national commission from value of

compensation claimed under the repealed 1986 Act to value of the

consideration paid for the goods and services. The petitioners and

the appellants claim that this legislative shift must have the effect

of annulling sections 34, 47 and 58 of the Act as unconstitutional .

5. Submissions: Mr. Shreeyash Lalit and Mr. Abhimanyu

Bhandari, Ld. Sr. Counsel represented the petitioner and the

appellant respectively. Mr. Vikramjit Banerjee assisted by Mr.

Nachiketa Joshi represented the respondents.

6. Mr. Shreeyash Lalit would submit that under the new legal

regime, an anomaly has arisen regarding pecuniary jurisdiction

and hierarchy of judicial system. The argument is that the

impugned provisions gives rise to an anomalous situation wherein,

for instance, a person claiming compensation of Rs. 50 Cr, for a

defect or deficiency in goods purchased or services availed, for

consideration lesser than Rs. One Crore will have to go before the

district commission and at the same time one can approach the

national commission even if the compensation is less than R s. One

Crore.

7

6.1 Ld. Counsel argues that the new criterion for determining the

pecuniary jurisdiction is discriminatory as consumers who claim

identical compensation, but have paid different considerations at

the time of purchase of goods or services are treated differently. To

buttress their argument, they referred to Section 2(7) of the 2019

Act which defines “consumer” and includes within its ambit any

person who buys goods/services for a consideration which is (i)

fully paid or promised, (ii) partly paid or promised, (iii) under a

system of deferred payment, and also includes (iv) a user of such

goods or services. Thus, when the definition of "consumer" itself

does not discriminate on the basis of the consideration paid and

includes every consumer in the wide spectrum, restricting access

to judicial remedies on the basis of consideration paid is illegal and

arbitrary.

6.2 As a logical extension of the same argument, it is submitted

that there is no rationale for introducing the new criterion for

determining the pecuniary jurisdiction. It is argued that even if the

object sought to be achieved is to curb instituting exaggerated

claims, the same could have been done by way of increasing the

pecuniary limits of the forums.

8

7. Mr. Vikramjit Banerjee, Ld. ASG appearing on behalf of the

Union opposed the writ petition and supported his argument on

the basis of written submission.

7.1 The first limb of his submission is that Parliament has the

legislative competence to determine the jurisdiction and also

pecuniary limits of courts and tribunals . To exemplify his

submission, he referred to some parliamentary enactments.

7.2 To counter the allegations of arbitrariness, Ld. ASG

submitted that the impugned provisions are based on a reasonable

classification. He would submit that classification created on the

basis of value of goods and services paid as consideration not only

creates an intelligible differentia, but also has a rational nexus

with the object sought to be achieved, which is “timely and effective

administration and settlement of consumer disputes”. Further, it

is argued, the impugned provisions are not manifestly arbitrary

and that they were brought in to prevent exaggerated and inflated

claims.

8. Analysis: The submissions made by the Ld. Counsels for the

petitioner/appellant and respondent can be considered in the

context of (i) power to determine pecuniary jurisdiction, (ii)

reasonable classification under Article 14, ( iii) manifest

9

arbitrariness, and (iv) loss of remedy. We will consider each of

these submissions independently.

9. Re: Power to determine pecuniary jurisdiction: There is no

doubt about the fact that the P arliament has the legislative

competence to enact the Consumer Protection Act, 2019. Under

Entry 95 of List I read with Entries 11-A and 46 of List III

6 and in

exercise of power under Article 246, the Parliament has enacted

the Consumer Protection Act, 2019. The legislative competence to

prescribe jurisdiction and powers of a court, coupled with the

power to constitute and organize courts for administration of

justice, takes within its sweep the power to prescribe pecuniary

limits of jurisdiction of the courts or tribunals. In State of Bombay

v. Narottamdas Jethabhai,

7 Justice Patanjali Sastri concurring

with the majority held as under:

“88. It had long been the practice in this country to constitute and

organise courts with general jurisdiction over all persons and

matters subject only to certain pecuniary and territorial limitations,

and to confer special jurisdiction limited to certain specified cases

or matters either on the ordinary courts in addition to their general

jurisdiction or on tribunals set up to deal with such matters

exclusively. The various Provincial Civil Court Acts as well as the

provisions of the Civil and Criminal Procedure Codes invest the

6

Item 95, List I: “Jurisdiction and powers of all courts, except the Supreme Court, with

respect to an of the matters in this List; admiralty jurisdiction.”

Item 11-A of List III: “Administration of justice; constitution and organization of all courts,

except the Supreme Court and High Courts.”

Item 46 of List III: “Jurisdiction and powers of all courts, except the Supreme Court, with

respect to any of the matters in this List.”

7

(1950) SCC 905

10

courts, both civil and criminal, with general jurisdiction, that is to

say, power to adjudicate in respect of all persons and all matters

except those that are specifically excluded or brought within the

cognizance of tribunals with special or limited jurisdiction extending

only to those matters. The grading of the court too in their hierarchy

has reference to the pecuniary and territorial limits rather than to

the nature and kind of the subject -matter which they are

empowered to deal with.”

9.1 Parliament has the legislative competence to prescribe

jurisdiction and powers of courts. This power extends to

prescribing different monetary values as the basis for exercising

jurisdiction. For example, under the Recovery of Debts and

Bankruptcy Act, 1993, it is prescribed under Section 1 (4) that the

provisions of the Act shall not apply where the amount of debt is

less than 10 lakh rupees. Section 4 of Insolvency and Bankruptcy

Code, 2016 provides that Part II of the Code , relating to insolvency

resolution and liquidation for corporate persons is made applicable

to matters relating to insolvency and liquidation of corporate

debtors where the minimum amount of default is Rs. One Crore.

Similarly, the Securitisation and Reconstruction of Financial

Assets and Enforcement of Security Interest Act, 2002 also

provides under Section 31(h) that the Act shall not apply for

securing repayment of any financial asset not exceeding Rs. 1 lakh.

Further, the Legal Services Authority Act, 1987 under Section

22(c)(1) provides that the permanent Lok Adalat shall not have

11

jurisdiction in matters where the value of the property in dispute

exceeds 10 lakh rupees. In Narottamdas Jethabhai (supra), Justice

Mahajan has observed as under:

“27. It seems to me that the legislative power conferred on the

Provincial Legislature by Item 1 of List II has been conferred by

use of language which is of the widest amplitude (administration

of justice and constitution and organisation of all courts). It was

not denied that the phrase employed would include within its

ambit legislative power in respect to jurisdiction and power of

courts established for the purpose of administration of justice.

Moreover, the words appear to be sufficient to confer upon the

Provincial Legislature the right to regulate and provide for the

whole machinery connected with the administration of justice in

the province. Legislation on the subject of administration of

justice and constitution of courts of justice would be ineffective

and incomplete unless and until the courts established under it

were clothed with the jurisdiction and power to hear and decide

cases. It is difficult to visualise a statute dealing with

administration of justice and the subject of constitution and

organisation of courts without a definition of the jurisdiction and

powers of those courts, as without such definition such a statute

would be like a body without a soul. To enact it would be an idle

formality. By its own force it would not have power to clothe a

court with any power or jurisdiction whatsoever. It would have

to look to an outside authority and to another statute to become

effective. Such an enactment is, so far as I know, unknown to

legislative practice and history. Parliament by making

administration of justice a provincial subject could not be

considered to have conferred power of legislation on the

Provincial Legislature of an ineffective and useless nature.”

(emphasis supplied)

9.2 In view of the above discussion, there can be no doubt about

the legislative competence and also the power of the Parliament to prescribe limits of pecuniary jurisdiction of courts and tribunals and in our case, the district, state or the national commission .

10. Re: Submissions that the provisions are discriminatory and

violative of Article 14: Sections 34, 47 and 58 vest jurisdictions in

12

the district, state and n ational commission on the basis of value of

goods or services paid as consideration. The precise question for

our consideration is whether empowering the district, state and

national commissions to exercise jurisdiction on the basis of value

of the goods or services paid as consideration is violative of

Article 14.

10.1 If there is one test for determining whether a provision of

‘law’ is violative of the equality norm, which has been articulated

with precision and clarity, it is the independent and

interconnecting twin test, as explained in State of West Bengal v.

Anwar Ali Sarkar

8 as;

“85. … In order to pass the test, two conditions must be fulfilled,

namely (1) that the classification must be founded on an

intelligible differentia which distinguishes those that are

grouped together from others, and (2) that that differentia must

have a rational relation to the object sought to be achieved by

the Act.”

10.2 Classification based on value of goods or services on the

basis of the amount paid as consideration is valid. “Consideration”

is an integral part of forming any contract. It is also an integral

part of the definition of a ‘ consumer’.

10.3 An agreement enforceable by law is a contract.

9 In turn,

every promise and every set of promises form ing part of the

8

(1952) 1 SCC 1

9

Section 2(h) of the Indian Contract Act, 1872.

13

consideration for each other, is an agreement.

10 And then, when,

at the desire of the promisor, the promisee … has done…something,

such act is called consideration

11. A proposal, when accepted,

becomes a promise

12. Finally, when a person signifies to another

his willingness to do anything… with a view to obtaining his assent

it is a proposal

13. While this is the involution of formation of a

contract, evolution in its making is evident when a proposal, as

defined, becomes a promise and when such a promise is espoused

by consideration it becomes an agreement and if that agreement is

enforceable in law, it becomes a contract . Between evolution and

involution, lies the essential core, the consideration, without which

there is no agreement, and if there is no agreement, there is no

contract.

10.4 It is in recognition of the first principles of formation of a

contract that section 2(7) of the 2019 Act defines a consumer as

any person who buys any goods or hires or avails any service for a

consideration. The consideration could be in the present or future,

in whole, part, or by deferred payment. Whichever be the mode,

there must be a consideration. That is essential to be a consumer .

10

Section 2(e) of the Indian Contract Act, 1872.

11

Section 2(d) of the Indian Contract Act, 1872.

12

Section 2(b) of the Indian Contract Act, 1872.

13

Section 2(a) of the Indian Contract Act, 1872.

14

10.5 Therefore, vesting jurisdiction in the d istrict, state or

national commission on the basis of value of goods or services paid

as ‘consideration’, is neither illegal nor discriminatory. For this

very reason, the submission made by Mr. Shreeyash Lalit that the

width of the expression ‘ consumer’ under Section 2(7) of the Act is

arbitrarily restricted by Sections 34, 47 and 58 pales into

insignificance. The myriad ways in which a consideration could be

inferred would not derogate from the essentiality of consideration

in every transaction leading to formation of a contract. As we are

not dealing with gratuitous agreements, value of consideration is

and can be a valid basis for classifying claims for determining

pecuniary jurisdiction. We therefore reject the submission that

sections 34, 47 and 58 are discriminatory and violative of

Article 14.

11. This classification also has a direct nexus to the object

sought to be achieved. It is thus not a suspect classification. Value

of consideration paid for good or service purchased is closer and

more easily relatable to compensation than the self -assessed claim

for damages of a consumer. It is clear that the determination of

jurisdiction of the district, state or national commissions on the

basis of value of consideration paid for purchase of goods and

15

services has rational nexus to the object of provisioning hierarchy

of judicial remedies. Mr. Vikramjit Banerjee has brought to our

notice the circumstances that have led to the introduction of

Sections 34, 47 and 58 under the 2019 Act. In this context,

reference is made to a “Study on impact of Consumer Protection

Act, 2019” wherein it is explained that,

“….The earlier standard of the manner of determining the

pecuniary jurisdiction i.e. 'the value of the goods or services and the

compensation, if any, claimed often resulted in a disproportionately

larger amount of cases falling under the pecuniary jurisdiction of

the NCDRC, as it took into account the value of the final good bought

or service availed and secondly upon the amount of compensation

that has been prayed for in the complaint. Thus the modifications

to the pecuniary jurisdiction were meant to alleviate the

disproportionate burden of cases which fell upon the National

Consumer Disputes Redressal Commission (NCDRC) by

apportioning a larger share to the District and State Consumer

Disputes Redressal Commissions. It also made the procedure

simpler and easier for consumers as now the consumers can get

justice at the District level for monetary level upto Rs one crore,

which covers most of the matters relating to goods and services

which a common consumer uses/ avails. The legislative intent

behind omitting the "compensation" claimed by a consumer in

assessing the jurisdiction is of streamlining the method of

determining the pecuniary jurisdiction by ousting individual whims

of a consumer. As there does not exist any guidance by which a

consumer may reasonably determine claims for compensation.

Naturally, this resulted in a situation wherein consumers often

claimed astronomical amounts of compensation despite the actual

consideration being relatively less and as a consequence the

District and State Commissions would be ousted of jurisdiction.”

11.1 There is also a misconception that there is some kind of a

loss of judicial remedy. No such event has occurred because of

Sections 34, 47 and 58 of the 2019 Act. The relief or compensation

that a consumer could claim remained unrestricted and at the

16

same time, access to the state or the national commission is also

not taken away. It is well settled that there is no right or a privilege

of a consumer to raise an unlimited claim of compensation and

thereby chose a forum of his choice for instituting a complaint. In

Nandita Bose v. Ratanlal Nahta

14, this Court has held that a court

or a tribunal will always have the jurisdiction to assess or reassess

an overvalued or grossly undervalued claim in a petition in the

following terms:

“4. …The principles which regulate the pecuniary jurisdiction of

civil courts are well settled. Ordinarily, the valuation of a suit

depends upon the reliefs claimed therein and the plaintiffs

valuation in his plaint determines the court in which it can be

presented. It is also true that the plaintiff cannot invoke the

jurisdiction of a court by either grossly over-valuing or grossly

under-valuing a suit. The court always has the jurisdiction to

prevent the abuse of the process of law. Under Rule 10 of Order 7

of the Code the plaint can be returned at any stage of the suit for

presentation to the court in which the suit should have been

instituted...”

(emphasis supplied)

In conclusion, while we hold that there is no unrestricted claim for

compensation and that it is subject to the determination of the

court, we hold that classification of claims based on value of goods

and services paid as consideration has a direct nexus to the object

of creating a hierarchical structure of judicial remedies through

tribunals.

14

1987 AIR 1947

17

12. Re: Performance Audit of the Statute: In the written

submissions, Ld. Counsel for the petitioner has brought to our

notice a decision of the national commission in the case of M/s

Pyaridevi Chabiraj Steel Pvt. Ltd. v. National Insurance Company

Ltd. & Ors.

15

“6. …He further submitted that a liberal view should be taken as if

"the word value of consideration paid" is taken to be the amount

paid for the purchase of goods or services by a Consumer then even

though Insurance Policy taken by the Consumer be above

10,00,00,000/-(Rupees Ten crore), factually there will be no

instance of making payment by any Consumer premium of more

than 10,00,00,000/-(Rupees Ten crore) and if such a strict view is

taken then the claims regarding Insurance will have to be

necessarily filed either before the District Consumer Disputes

Redressal Commission or before the State Consumer Disputes

Redressal Commission and not before the National Consumer

Disputes Redressal Commission, which will create great hardship

to such Consumers.”

(emphasis supplied)

12.1 Apart from the observation made by the national

commission, the Ld. Counsel for the petitioners has submitted that

wherever value of goods and services paid as consideration is upto

Rs. One Crore, a consumer has to necessarily approach a district

commission. Taking the example of insurance claims, it is

submitted that only in rare cases the insurance premium would

exceed Rs. One Crore and as such the entirety of claims based on

deficiency of service by insurance company will be restricted to

15

CC No. 833 of 2020

18

district commission. The scheme under 2019 Act, it is submitted,

has become lopsided and has impaired the original jurisdiction of

the state and n ational commissions.

12.2 This argument is not based on any illegality, much less on

legislative incompetency or ultra vires to Constitution. The

soundness of this submission will depend on the working of the

statute and the data that may be available for assessing its impact.

Its implementation and consequences have to be closely examined,

analysed and impact assessed.

12.3 A proper appreciation of this issue would depend on

performance audit of the 2019 Act. The need for performance audit

of a statute was considered by this Court in the case Yash

Developers v. Harihar Krupa Co- operative Housing Society Ltd. &

Ors.

16 wherein it was held that assessing the working of the

statute to realise if its purpose and objective are being achieved or

not is the implied duty of the executive government. Reviewing and

assessing the implementation of a statute is an integral part of

Rule of Law. It is in recognition of this obligation of the executive

government that the constitutional courts have directed

governments to carry performance audit of statutes.

16

2024 INSC 559; See Para 35.

19

12.4 Four aspects for achieving justice are well founded and

articulated as, i) distribution of advantages and disadvantages of

society, ii) curbing the abuse of power and liberty, iii) deciding

disputes and, iv) adapting to change. Adapting to change is

important for achieving justice, as failure to adapt produces

injustice and is, in a sense, an abuse of power. Thus, failure to use

power to adapt to change is in its own way an abuse of power. In

fact, the issue is not one of change or not to change, but of the

direction and the speed of change and such a change may come in

various ways, and most effectively through legislation. Legal

reform through legislative correction improves the legal system

and it would require assessment of the working of the law, its

accessibility, utility and abuse as well. The Executive branch has

a constitutional duty to ensure that the purpose and object of a

statute is accomplished while implementing it. It has the

additional duty to closely monitor the working of a statute and

must have a continuous and a real time assessment of the impact

that the statute is having. As stated above, reviewing and

assessing the implementation of a statute is an integral part of

Rule of Law. The purpose of such review is to ensure that a law is

working out in practice as it was intended. If not, to understand

20

the reason and address it quickly. It is in this perspective that this

Court has, in a number of cases, directed the Executive to carry a

performance/assessment audit of a statute or has suggested

amendments to the provisions of a particular enactment so as to

remove perceived infirmities in its working.

17

12.5 A peculiar feature of how our legislative system works is

that an overwhelming majority of legislations are introduced and

carried through by the Government, with very few private member

bills being introduced and debated. In such circumstances, the

judicial role does encompass, in this C ourt’s understanding, the

power, nay the duty to direct the executive branch to review the

working of statutes and audit the statutory impact. It is not

possible to exhaustively enlist the circumstances and standards

that will trigger such a judicial direction. One can only state that

this direction must be predicated on a finding that the statute has,

through demonstrable judicial data or other cogent material, failed

to ameliorate the conditions of the beneficiaries. The courts will

also do well, to at the very least, arrive at a prima facie finding that

much statutory schemes and procedures are gridlocked in

bureaucratic or judicial quagmires that impede or delay statutory

17

Id. See Para 36.

21

objectives. This facilitative role of the judiciary compels audit of the

legislation, promotes debate and discussion but does not and

cannot compel legislative reforms.

18

12.6 It is in the above referred context of conducting performance

audit of a statute that we recognise the constitution and

establishment of two statutory bodies, the Central Consumer

Protection Council under section 3 and Central Consumer

Protection Authority under section 10 of the 2019 Act.

12.7 The Central Consumer Protection Council

19 is constituted

under section 3;

“3. Central Consumer Protection Council.

(1) The Central Government shall, by notification, establish with

effect from such date as it may specify in that notification, the

Central Consumer Protection Council to be known as the Central

Council.

(2) The Central Council shall be an advisory council and consist

of the following members, namely:—

(a) the Minister-in-charge of the Department of Consumer Affairs

in the Central Government, who shall be the Chairperson; and

(b) such number of other official or non-official members

representing such interests as may be prescribed.”

12.8 To ensure that the advise is well considered and takes

within its sweep plurality of thought and ideas, the Council

comprises officials and non-officials, apart from Ministers-in-

charge of Co nsumer Affairs. In exercise of powers under section

18

Id, See para 41.

19

Hereinafter, “Council”.

22

101 of the 2019 Act, the Ministry of Consumer Affairs issued the

Consumer Protection (Central Consumer Protection Council)

Rules, 2020 whereunder the composition of Consumer Council is

given. It is prescribed that it shall comprise Minister in-charge of

Consumer Affairs of Union as the Chairperson, Minister of State

or Deputy Minister in charge of Consumer Affairs in the Central

Government who shall be the Vice- Chairperson, an administrator

from UTs, two M embers of Parliament, representatives of

Departments of the Central Government, autonomous

organisations or regulators concerned with consumer interests,

Chief Commissioner of Authority , Registrar of the national

commission, representatives from consumer organisations and

experts in consumer affairs along with Secretaries -in-charge of

Consumer Affairs in the Centre and States.

20 The purpose and

object of the Council is provided in section 5 of the 2019 Act in the

following terms;

“5. Objects of Central Council: The objects of the Central

Council shall be to render advice on promotion and protection of

the consumers' rights under this Act.”

20

Rule 3 of the Consumer Protection (Central Consumer Protection Council) Rules, 2020.

23

12.9 On the other hand, the 2019 Act also establishes another

important body, the Central Consumer Protection Authority

21

under section 10 of the Act;

“10. Establishment of Central Consumer Protection

Authority

(1) The Central Government shall, by notification, establish with

effect from such date as it may specify in that notification, a

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 interests

of public and consumers and to promote, protect and enforce the

rights of consumers as a class.

(2) The Central Authority shall consist of a Chief Commissioner

and such number of other Commissioners as may be prescribed,

to be appointed by the Central Government to exercise the

powers and discharge the functions under this Act.”

12.10 The powers and functions of the Authority are provided

under section 18 of the Act and it empowers the Authority inter

alia to (a) protect, promote and enforce the rights of consumers as

a class, and prevent violation of consumers rights [Section

18(1)(a)]; (b) recommend adoption of international covenants and

best international practices on consumer rights to ensure effective

enforcement of consumer rights [Section 18(2)(e)]; (c) undertake

and promote research in the field of consumer rights [Section

18(2)(f)]; (d) advise the Ministries and Departments of the Central

and State Governments on consumer welfare measures [Section

18(2)(k)].

21

Hereinafter, “Authority”.

24

12.11 Apart from the above, the Authority exercise vast powers

under sections 19 to 22. In exercise of powers under section 101,

the Ministry of Consumer Affairs has framed rules and regulations

such as, ‘ The CCPA (Allocation and Transaction of Business)

Regulations, 2020’, ‘The CCPA (Procedure for Engagement of

Experts and Professionals) Regulations, 2021 ’, ‘The CCPA

(Submission of Inquiry or Investigation by the Investigation Wing)

Regulations, 2021’, ‘The CCPA (Form of annual statement of

accounts and records) Rules, 2021’.

12.12 Purpose and object of constituting these authorities is

clearly reflected in the preamble of the 2019 Act, the terms of

which are;

“An Act to provide for protection of the interests of consumers

and for the said purpose, to establish authorities for timely and

effective administration and settlement of consumers' disputes

and for matters connected therewith or incidental thereto.”

12.13 It is interesting to note that in the statement of objects and

reasons of the 2019 Act there is a reference to, “an institutional

void in the regulatory regime” of consumer protection. To obviate

this institutional void, the Parliament has under section 10 of the

2019 Act established the Authority and vested in it various powers

and functions. The relevant portion of the statement of objects and

reasons is quoted here for ready reference;

25

“4. The proposed Bill provides for the establishment of an

executive agency to be known as the Central Consumer

Protection Authority (CCPA) to promote, protect and enforce the

rights of the consumers; make interventions when necessary to

prevent consumer detriment arising from unfair trade practices

and to initiate class action including enforcing recall, refund and

return of products, etc. This fills an institutional vo id in the

regulatory regime extant. Currently, the task of prevention of or

acting against unfair trade practices is not vested in any

authority. This has been provided for in a manner that the role

envisaged for the CCPA complements that of the sector

regulators and duplication, overlap or potential conflict is

avoided.”

12.14 The purpose and object behind referring to the constitution

and functioning of the Council and the Authority is only to ensure

that the regulatory regime for consumer protection is clearly

identified, coordinated – if not centralised and declared to be duty

bearers for effective functioning of the consumer protection regime.

In a recent decision

22, this Court held that that the significance of

creation and establishment of these statutory and administrative

bodies is not difficult to conceive. If these institutions and bodies

work effectively and efficiently, it is but natural that the purpose

and object of the legislation will be achieved in a substantial

measure.

It is, therefore, necessary to ensure that in the

functioning of these bodies, there is efficiency in administration,

expertise through composition, integrity through human

22

Lifecare Innovations Pvt. Ltd. v. Union of India, 2025 INSC 269.

26

resources, transparency and accountability, and responsiveness

through regular review, audits and assessments.

23

12.15 We are also exercising jurisdiction under Article 32 of the

Constitution, as the petitioner expressed concern over the

ineffective working of the institutions intended to exercise

jurisdiction and power for consumer protection. While exercising

judicial review of administrative action in the context of Statutes,

laws, rules or policies establishing statutory or administrative

bodies to implement the provisions of the Act or its policy, the first

duty of constitutional courts is to ensure that these bodies are in

a position to effectively and efficiently perform their obligations.

This approach towards judicial review has multiple advantages. In

the first place, while continually operating in the field with domain

experts, these bodies acquire domain expertise, the consequence

of which would also be informed decision-making and consistency.

Further, the critical mass of institutional memory acquired by

these bodies will have a direct bearing on the systematic

development of the sector and this will also help handling

polycentric issues. Thirdly, while continuously being on the field,

and having acquired the capability of making real -time

23

Id. See para 21.

27

assessments about the working of the policies, these bodies will be

in a position to visualize course correction for future

policymaking.

24

12.16 Shifting the focus of judicial review to functional capability

of these bodies is not to be understood as an argument for

alternative remedy, much less as a suggestion for judicial

restraint. In fact, this shift is in recognition of an important feature

of judicial review, which performs the vital role of institutionalizing

authorities and bodies impressed with statutory duties, ensuring

they function effectively and efficiently. The power of judicial

review in matters concerning implementation of policy objectives

should transcend the standard power of judicial review to issue

writs to perform statutory duty and proceed to examine whether

the duty bearers, the authorities and bodies are constituted

properly and also whether they are functioning effectively and

efficiently. By ensuring institutional integrity, we achieve our

institutional objectives. Further, effective and efficient

performance of the institutions can reduce unnecessary

litigation.

25

24

Id. See para 22.

25

Id. See para 23.

28

12.17 In conclusion we hold that the Council and Authority being

statutory authorities having clear purpose and objects and vested

with powers and functions must act effectively and in complete

coordination to achieve the preambular object of the statute to

protect the interest of consumers. As they are impressed with

statutory duty, their functioning will be subject to judicial review.

Vibrant functioning of the Council and the Authority will subserve

the purpose and object of the Parliament enacting the 2019

legislation.

13. Conclusions: For the reasons stated above; (a) we dismiss the

constitutional challenge to section 34, 47 and 58 of the 2019 Act

and declare that the said provisions are constitutional and are

neither violative of Article 14 nor manifestly arbitrary; (b) Central

Consumer Protection Council and the Central Consumer

Protection Authority shall in exercise of their statutory duties

under sections 3, 5, 10, 18 to 22 take such measures as may be

necessary for survey, review and advise the government about

such measures as may be necessary for effective and efficient

redressal and working of the statute. With the above directions,

the Writ Petition and Civil A ppeal are disposed of.

29

14. Pending applications, if any, are also disposed of accordingly.

………………………………....J.

[PAMIDIGHANTAM SRI NARASIMHA]

………………………………....J.

[MANOJ MISRA ]

NEW DELHI;

APRIL 29, 2025