In a major ruling, the Supreme Court closed the debate over how much power a consumer has when choosing their forum for complaints, giving a full nod to the Consumer Protection Act, 2019’s method of deciding jurisdiction.
A bench led by Justices PS Narasimha and Manoj Misra gave their seal of approval to Sections 34, 47, and 58 of the Act, which sort cases based on the actual money paid for a product or service — not the sky-high compensation figures some consumers might throw into their complaints.
“The value you paid ties directly to where you can go for justice,” the Court ruled, explaining that the system creates a logical ladder of forums: district, state, and national. The result? Petitions challenging the law were tossed out.
The case was sparked by two tragic stories: a woman whose husband died after their ₹31 lakh Ford Endeavour caught fire, and another woman whose husband succumbed to COVID-19, leading her to seek a ₹14.94 crore insurance claim. Both had headed straight for the top — the National Consumer Disputes Redressal Commission (NCDRC) — arguing that their claimed damages made it the right venue.
But the 2019 Act wasn’t having it. Under the new rules, what matters is the price of the car or the insurance premium paid — not the amount being demanded after things go wrong. The Ford buyer’s case, for example, belonged at the District Commission, not the national level, because ₹31 lakh was the transaction value.
The petitioners cried foul, calling the system discriminatory and a violation of their right to equality under Article 14. The Court firmly disagreed.
“Payment amount isn’t arbitrary,” the bench said, adding that in the world of contracts, consideration — what you pay — is king. The Court also pointed out that the changes were designed to stop consumers from inflating their compensation claims just to land in a higher forum.
No remedy was being taken away, the Court stressed — consumers could still claim billions if they wanted, but would have to do so before the forum their original purchase placed them in.
The judges leaned on precedent too, referencing Nandita Bose v. Ratanlal Nahata, reminding everyone that courts can deflate bloated claims to prevent the abuse of process.
As for concerns that big insurance claims would be stuck in lower forums because premiums are usually under ₹1 crore? That’s not a constitutional crisis, the Court said — that’s a matter for lawmakers to think about. In fact, the Court nudged the Central Consumer Protection Council and the Central Consumer Protection Authority to run audits and surveys to keep an eye on how the Act is performing in the real world.
“Reviewing how a law works isn’t just nice — it’s part of the Rule of Law,” the Court wrote. If tweaks are needed down the line, it’s on the executive to make them.
In the end, the verdict was clear: petitions dismissed, 2019 Act upheld, and the new rulebook for consumer cases stays firmly in place.
