MISLEADING ADVERTISEMENTS AND THE LAW IN INDIA
MISLEADING
ADVERTISEMENTS AND THE LAW IN INDIA
“What
really decides consumers to buy or not to buy is the content of your
advertising, and not its form.”
-David Ogilvy
1. INTRODUCTION
Some
3,000 years ago, shoemakers and scribes promulgated their services on clay
tablets. Ancient Greeks used town criers to proclaim the arrival of ships laden
with cargo of wine and spices[1]. Advertising is as old as
civilisation and commerce. Today,
advertisements have spread its tentacles in over all walks of human life.
It
is here when the need for consumer protection[2] is greatly realized where
the consumers require protection from all three sides viz. the state
(legislations and grievance redressal), the vendor (self-regulation) and the
consumer himself (self-awareness).
2. DEFINITIONS
OF ADVERTISING
Ones
perception of advertisements and the connotations given to it can change day by
day. Traditionally, John E. Kennedy has defined advertisement as “salesmanship
in-print” and this apparently is one of the most widely used three word
definition of advertisements.[3]
3. TESTS
OF ADVERTISING
Tests
for Identifying Deceptive Advertisements Courts and forums have in the course
of deciding cases related to deceptive advertisements, evolved a few tests to
determine whether an advertisement is deceptive or not. Some of the most
important tests which have been so evolved include:
(a)
Reasonable person test, and
(b) Impression test.
3.1 REASONABLE
PERSON TEST
As
the law wants to protect the general public or common man against deceptive
advertisements, the concept of “general public” or “common consumer” requires
clarity. The Sacchar Committee,[4] way back in 1978 had
endorsed the “average purchaser” standard as a test to determine the character
of a trade practice.[5] The apex court relies on
the “reasonable man's intelligence”[6] as a standard to test if
there is deception in an advertisement. The court has used the “reasonable man”
test to determine if a certain advertisement will be perceived as deceptive or
not.
3.2 THE
IMPRESSION TEST:-
The
impression test is an offshoot of the reasonable person test and it fine tunes
this test. Most people who watch advertisements on the electronic media, such
as television, get deeply influenced by it as it effects the psyche of the
viewers.[7] Therefore, an advertiser
has to virtually walk on a tight rope while telecasting a commercial and
repeatedly ask himself the question, what impact would the commercial have on
the mind of a viewer?[8]
4. NEED
FOR REGULATION
The
purpose of regulating misleading advertising under a statutory framework is to
ensure that advertisements do not twist the facts about the product and mislead
the consumer by way of subtle implications, exclusions, and fake statements
with respect to the quality, quantity, and features of the product or any
service accompanying the product.
KINDS
OF MISLEADING ADVERTISEMENT:
An
advertisement could be considered as misleading under multiple situations.
a. Hidden
fees and charges when the consumers are often misled by the hidden charges made
by the Service providers on the fees and surcharges that are not disclosed to
the customer in the advertised price.[9]
b. Misleading
includes when there was manipulation[10] of measurement units and
standards.
c. False
colouring is one form of misleading the customers to make them believe that the
food is fresher, riper or otherwise healthier. Same is mainly made by using
chemicals which ruins the health of consumers.
d. Many
companies give false guarantee without specifying the remedy if that guarantee
fails.
6. GAMUT
OF LEGISLATIONS CONTROLLING MISLEADING ADVERTISEMENTS:-
The significance of the legislations is to assimilate
and assert that a comprehensive and distinct law is required to regulate rather
than the scattered and insignificant provisions. Following are certain
legislations regulating misleading advertisements in various arenas:-
i.
THE CONSUMER PROTECTION ACT, 2019:-
The
genesis of the pertinent act has taken place from the Consumer Protection Act,
1986. While the aforementioned act had solely defined unfair trade practices[11], the Consumer Protection
Act, 2019 has made it quite unambiguous by defining misleading advertisements.[12] The act provides for the
establishment of a Central Consumer Protection Authority[13] and allocates power to
the District Collector as well in regard to regulation of matters relating to
violation of consumer rights and carrying out the inquiries relating to the
same.[14]
ii.
THE CONSTITUTION OF INDIA:
Even though there is no
singular provision for regulating advertisements, the Constitution of India
clearly protects freedom of speech and expression in Article 19(1)(a) with
reasonable restrictions.[15] The Supreme Court held
that, an advertisement is no doubt a form of speech and expression but every
advertisement is not a matter dealing with the expression of ideas and hence
advertisement of a commercial nature cannot fall within the concept of Article
19(1)(a) if it in any manner intends to mislead the masses.[16] Thus, the Court, however,
made it clear that the government could regulate commercial advertisements,
which are deceptive, unfair, misleading and untruthful.[17]
iii.
VERGHESE COMMITTEE REPORT
Verghese Committee Report in 1978 is
one of the significant reports, based on which certain general rules of conduct
were laid down by the Government. Some of the rules are relating to misleading
advertisements. According to the rules:
1.
No advertisement shall contain references which are likely to lead public to
infer that the product advertised or any of its gradients has some property or
quality which is capable of being established e.g. care for baldness.
2.
Advertisement should not be designed to confuse the consumer’s mind as: a. The
imitation of the trademark or name of a competitor or the packaging or
labelling of goods, or b. The imitation of advertising devices, copy, layout or
slogans.
7. SELF
REGULATORY BODIES IN INDIA
i.
ADVERTISING STANDARDS
COUNCIL OF INDIA
It
is found that Advertising Standards Council of India (ASCI) was appointed by
the Department of Consumer Affairs (DoCA) to monitor the web portal Grievances
Against Misleading Advertisement wherein the complaints are handled in a three
tier system i.e. first complaints are processed by ASCI, the second level of
escalation in case of noncompliance to a sub-committee headed by the Joint
Secretary, DoCA, under Inter Ministerial Monitoring Committee (IMMC) and in the
end, the concerned regulator was empowered by law to take action in case of
persistent offenders.
8. CONCLUSION:-
When
the judicial approach is viewed from the laws which are applied by the Courts,
it could be found that in most cases the Courts rely upon Advertising Codes
framed by Regulatory Bodies such as Press Council of India, Advertising
Standards Council of India etc. The Statute enacted must provide the definition
of advertisements, fixing the criteria to hold an advertisement as misleading,
making ease the way to approach the judiciary and determining the remedy by
imposing ban or awarding compensation to the aggrieved. Only after enactment of
a separate statute, the judicial approach could be effective in regulating the
misleading advertisements.
[1] Lien Verbauwhede, “Intellectual
Property Issues in Advertising” (2nd Edition).
[2] U.P Power Corporation Ltd, &
Ors v. Anis Ahmad;2013 (5) ABR 494.
[3] Claude C. Hopkins, Scientific
Advertising, Cool Publications, England (1st e-book edn., 2004), p.10).
[4] Justice Rajindar Sachar, Report of
The High-Powered Expert Committee on Companies and MRTP Acts, 1978, p.263.
[5] K Sampath, “New Challenges in Service Sector”, in
Vallanadu Narayanan Viswanathan (ed.), Consumer Rights in Service Sector,
Concept Publishing Company, New Delhi (2008), p. 27.)
[6] Mahadev Pradesh Kaushik vs. State
of Uttar Pradesh and Another; (2008) 14 SCC 479.
[7] Pepsi Co. Inc. & Ors. v.
Hindustan Coca Cola Ltd. & Another; 2003 (27) P.T.C 305 (Del.).
[8] Dabur India Ltd. v. M/S Colortek Meghalaya Pvt. Ltd.,
2010 (42) P.T.C 88 (Del.).
[9]
For example, according to
Consumer Complaint Council (CCC) of ASCI, the grocery delivery startup Grofers
for its advertisement claiming to sell Dunky Doos Donut Box of six at Rs 199,
was ―misleading by ambiguity and omission" as it mentions that the price
quoted is subject to taxes. The Council holds that "The advertisement
carried the price of the product as Rs 199, followed by an asterisk and a
further caveat with the words 'T&C Apply.
[10]
Term Manipulation includes
claims such as Natural, Fresh, Pure, Organic , Original , Traditional ,
Premium, Finest, Best , Authentic , Genuine, Real etc. Even words like, ‗Home
made , Home Cooked, may give an erroneous impression to the consumer and should
not be used to mislead them.
[11] Section 2(1)(r) of the Consumer
Protection Act, 1986.
[12]
Section 2(28) of the Consumer
Protection Act, 2019 defines misleading advertisement as any advertisement in
relation to product or service which (i) falsely describes such product or
services or (ii) gives a false guarantee to or is likely to mislead the
consumers or (iii) conveys an express or implied representation which would
constitute an unfair trade practice or (iv) deliberately conceals important
information.
[13] Section 10 of the Consumer
Protection Act, 2019.
[15] Article 19(2) of the Constitution
of India.
[16] Hamdard Dawakhana v. Union of
India;
[17] Tata Press Ltd. V. Mahanagar
Telephone Nigam Limited and Ors. AIR 1995 SC 2438.