More information on the subject, What is an Unfair Trade Practice? Examples from Indian Marketplaces
Meaning of Unfair Trade Practice
Unfair trade practices refer to deceptive, misleading, or unethical conduct by a seller or service provider that misleads consumers or gives them false information about a product or service. Under the Consumer Protection Act, 2019, this includes actions such as false advertising, misleading discounts, deceptive warranties, or misrepresentation of goods and services.
These practices harm consumer trust, lead to financial loss, and distort fair competition in the marketplace.
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Common Examples in India
- Fake Discounts: Inflating the original price before offering a so-called discount.
- Misleading Ads: Advertisements that make false claims about product quality, benefits, or origin.
- False Warranty Promises: Offering guarantees or after-sales service that is not actually honored.
- Limited-Time Gimmicks: Artificial urgency to pressure buyers without real scarcity.
- Mislabeling: Selling expired or substandard products by altering the packaging or dates.
- Fake Reviews or Testimonials: Publishing false reviews to manipulate consumer perception.
- Pyramid Schemes: Business models disguised as multi-level marketing that exploit consumers.
Unfair trade practices often appear in ways that are easy to miss unless you're alert. Below are detailed examples that frequently occur in Indian marketplaces—both online and offline:
1. Fake Discounts
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Retailers or e-commerce platforms raise the "original price" before applying a discount, creating an illusion of savings.
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For example, a product normally priced at ₹1,000 may be shown as ₹2,000 with a “50% off” tag, even though it was never sold at ₹2,000.
2. Misleading Advertisements
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Ads that claim products cure diseases, improve performance, or provide benefits without proof.
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Example: Beauty products claiming “instant fairness” or medicines sold as “herbal cures” without scientific backing.
3. False Warranty Promises
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Sellers or manufacturers promise free repairs, replacements, or after-sales service—but don’t honor them when issues arise.
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Common with electronics and appliances, especially during festive sales.
4. Limited-Time Gimmicks
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Tactics like “Only 2 Left!” or “Offer Ends in 1 Hour!” are used to create urgency even if the stock is available or the offer is extended later.
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Such gimmicks pressure consumers into impulse buying without informed decision-making.
5. Mislabeling of Products
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Selling expired, defective, or counterfeit goods by altering expiry dates or product information.
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Includes relabeling used or returned goods as new, or selling fake versions of branded items.
6. Fake Reviews or Testimonials
7. Pyramid Schemes Masquerading as MLMs
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Businesses that promise high earnings by recruiting others into the scheme, rather than selling actual products or services.
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Common red flag: Focus is on recruitment incentives rather than product value.
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Legal Remedies for Consumers
If you’ve been misled by an unfair trade practice, the law offers protection:
- File a complaint with the District Consumer Commission or higher (based on the claim amount).
- You can seek compensation, refund, product replacement, or punitive damages.
- File an online complaint at consumerhelpline.gov.in.
- Engage a consumer lawyer if the issue involves significant loss or complex evidence.
If you’ve been affected by an unfair trade practice in India—such as misleading advertisements, fake discounts, or false warranty promises—you have clear legal options under the Consumer Protection Act, 2019. Here’s how you can respond:
1. File a Complaint with the Consumer Commission
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Depending on the value of the claim, you can file your complaint at the appropriate level:
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District Consumer Disputes Redressal Commission – For claims up to ₹50 lakhs.
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State Consumer Commission – For claims between ₹50 lakhs and ₹2 crores.
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National Consumer Commission – For claims exceeding ₹2 crores.
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You do not need a lawyer to file a complaint—many consumers successfully represent themselves.
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Prepare to submit evidence such as:
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Screenshots of false ads or misleading claims
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Bills, receipts, warranty cards, or packaging
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Email or message correspondence
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Photographs of the product or service
2. Seek the Right Relief
You can demand:
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Refund of the amount paid
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Replacement of the faulty or misrepresented product
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Compensation for financial losses or emotional distress
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Punitive damages in cases of willful fraud or repeated offenses
3. Online Complaint Portal
You can file a complaint online via the official portal:
4. Involve a Consumer Lawyer (Optional)
While many complaints can be handled personally, consider hiring a lawyer if:
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The claim is complex (involving multiple parties, large sums, or unclear evidence)
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The seller or service provider refuses to respond
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You're preparing for appeal or cross-examination at a higher commission level
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How to Prove It
To succeed in your complaint, you should be able to show:
- That the seller made a false or misleading statement or representation.
- You believed or relied on that false claim while making the purchase.
- You suffered a financial loss, inconvenience, or loss of trust.
- You have supporting evidence — screenshots, advertisements, receipts, warranties, or review records.
For a complaint about unfair trade practices, you must present clear and convincing evidence. Here's what typically needs to be shown:
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There Was a False or Misleading Representation
First, you need to demonstrate that the seller or service provider made a claim that was either untrue, exaggerated, or misleading. This could be about the quality of the product, pricing, warranty, quantity, origin, or benefits.
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You Relied on That Claim to Make a Purchase
It's important to show that you made your buying decision based on that claim. If the misleading statement influenced your trust or convinced you to buy, that reliance strengthens your case.
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You Suffered a Loss
You must show that the unfair practice caused you financial loss, inconvenience, or loss of trust as a consumer. This could include:
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Paying more for a product than it’s worth
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Buying a product that doesn’t work as promised
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Wasting time or resources to get a refund or repair
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Feeling cheated or misled, which affects your confidence in the market
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You Have Proof or Evidence
Strong complaints are backed by solid evidence. Save and submit the following wherever possible:
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Screenshots of the misleading advertisement or offer
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Photos or videos of the product or service
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Receipts, invoices, or payment confirmations
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Warranty cards, user manuals, or promotional materials
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Chat/email conversations or call records with the seller
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Customer reviews or third-party testimonials showing others faced similar issues
The more complete your documentation, the stronger your position. Even one well-timed screenshot or invoice can tip the case in your favor.
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What is NOT Considered Unfair
- Buyer’s Remorse: Simply regretting a purchase without actual deception.
- Opinion-Based Ads: Puffery like “best in the world” unless it includes factual misrepresentation.
- Genuine Stock Shortage: Where the seller did not intend to deceive.
- Informed Choices: If terms were clearly stated and accepted by the buyer.
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