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CS Executive · Economic, Commercial and Intellectual Property Laws · Law relating to Consumer Protection

Zenith Appliances Ltd. lost a complaint before the State Consumer Disputes Redressal Commission in Maharashtra. During hearing, the Commission found that a clause in Zenith's standard sale contract was unfair to consumers. Under the Consumer Protection Act, 2019, what power does the State Commission have regarding that clause?

The State Commission may itself declare any contract term that is unfair to a consumer to be null and void. This power is in addition to its complaint-disposal procedure, and it does not need confirmation from another body or extend to the whole contract.

  1. AIt may declare the unfair contract term null and voidCorrect
  2. BIt may only recommend the Central Authority to amend the clause
  3. CIt may declare the term void only if the National Commission confirms it
  4. DIt may declare the whole contract void even if the term is severable

Explanation

Section 49(2) provides that, without prejudice to the complaint procedure, the State Commission may declare any term of contract which is unfair to any consumer to be null and void. It is a direct power and needs no confirmation. The option about the whole contract goes beyond the text, which speaks of a term.

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