Flooded with growing consumer complaints over misleading advertisements, especially relating to health and nutritional benefits and the get-rich schemes, the government is planning an investigating agency to curb the practice.
The proposed agency will supplement consumer courts, which cannot collect evidence themselves, while other measures planned include sharpening of the Consumer Protection Act.
“An investigating agency suits our requirement for the purpose,” said a senior consumer affairs ministry official, who did not want to be named.
“We need an institutional mechanism as we get a large number of complaints of misleading advertisements,” the official told .
Sources in the ministry said the probe agency could have a small team consisting of four or five officials and be on the lines of the investigation wing under the former Monopolies and Restrictive Trade Practices Commission, now known as the Competition Commission of India.
The sources said the Consumer Protection Act allows the department to order probe into specific complaints and take the culprits to the consumer courts, adding the probe agency could come handy here as the consumer courts cannot collect evidence.
In other cases, the government itself can become a complainant, they said.
The proposal for a probe agency would soon be sent to the Prime Minister’s Office (PMO) for approval, said sources.
A sense of urgency in the consumer affairs ministry to create a mechanism to curb the menace of misleading advertisements follows from a PMO directive last month.
Sources said the move aims to protect the consumer against advertisements promising false health and nutrition benefits and “will cover advertisements across all mediums like electronic, print and hoardings”.
The sources said they have been taking note of misleading advertisements related to nutrition in food supplements, cosmetics and herbal products promising immediate health benefits.
The Indian nutraceutical — products that combine the benefits of nutrition with pharmaceuticals — market is worth $1 billion. Globally, the market for nutraceuticals is pegged at around $124 billion.
Besides, the proposal will cover the services sector, for instance, the get-rich-quickly schemes, they said.
With TV becoming a strong medium, the chances of gullible consumers being taken for a ride by misleading advertisements have increased, they said.
“Hence the need for a new mechanism,” said an official.
Sources said certain provisions of the Consumer Protection Act need to be sharpened and the definition of “misleading advertisements” and the punishment prescribed for them expanded to curb the menace.
“At present, misleading advertisements are treated as unfair business practices. We want to examine whether it requires a sharper definition,” said an official.
To get an expert view, the ministry has sought opinion from some Indian Institutes of Management and the National Law School of India University, Bangalore.
While the consumer affairs ministry will consult the health ministry to dovetail provisions of the Food Safety Act and the Drugs and Cosmetics Act in the new regulatory mechanism, it will also look at the international best practices to strengthen the probe agency, the sources said.