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Profile of the Author: Dheerja is a 4th-year B.Com LL.B (Hons.) student of University Institute of Legal Studies, Panjab University, Chandigarh. She has a keen interest in the Constitution, Economics of Law, and Minority Rights.

Introduction

Bill Bernbach quotes that “The most powerful element in advertising is the truth”. Nevertheless, the Infodemic amidst the Pandemic is axiomatic of the fact that the veracity of information is inconsequential when the consumer is inerudite and believes content preferentially.

Misleading Advertisements: A Norm rather than an Exception in India

Advertisement is the soul of commerce in any business organisation as it eliminates the hindrance of information. The consumer is indisputably persuasive, thus escalating the impact of the advertisements manifold in today's digitised world. The essence of advertisement is reflected when an informed citizen makes a responsible decision. The current trend of the advertisements in the veil of ‘Puffery’ is violating the Fundamental Right to Choice and Information. It is in the backdrop of these aspersions that intensify the need for amendment in the current legislation regulating advertisements.

The Advertising Standards Council of India (ASCI), a self-regulatory body, inspected complaints against 415 advertisements in December 2018 and January 2019. The ASCI’s Consumer Complaints Council (CCC) sustained complaints against 230 advertisements as opposed to a total of 290 advertisements under investigation. [3]

The ASCI observed that the statement ‘50 Years Doctor’s Trust’ by Johnson & Johnson, was defectively substantiated because the survey report of 2012, that was appreciated as evidence-on-record, was inadequate as the majority of interviewed doctors had less than 20 years of clinical experience. [4] Thus, the statement was found misleading.

In another prominent instance, a complaint was filed against Arnica Hair Oil, a product of Dr Wellmans Homoeopathic Laboratory India Private Limited. It claimed ‘It gives cooling to the brain and better sleep’ [5] which was not corroborated with product efficacy data, thus, declared misleading. The case against Garnier Pure Active Neem and Tulsi High Foaming Facewash of L’Oreal India Private Limited was upheld by ASCI for misleading advertisement as the assertion ‘Removal of 99.9% pimple-causing germs’ [6] is ambiguous and inconclusive due to insufficient empirical data. According to the Department of Consumer Affairs Report, 25 out of 33 advertisements of Patanjali were held violative of the ASCI code in 2015-16. [7]

The aforementioned instances have increased exponentially in the recent past and swiftly imbibed itself as a norm in the Indian advertisements to exploit the indecisiveness of human nature.

Jurisprudential Position

The primary statutes that govern misleading advertisements in India are the Consumer Protection Act, 2019, and the Advertising Standards Council of India Code, 1985. Other significant legislation are the Trademarks Act, 1999 and the Competition Act, 2002.

The Consumer Protection Act, 2019 was enacted to protect consumers from exploitation. The Act, under Section 10, establishes the Central Consumer Protection Authority (CCPA) to regulate matters regarding misleading advertisements and/or misrepresentation in advertisements. The Act confers the power to CCPA to impose a penalty up to INR 10,00,000/- (Indian Ten Lakh) on a manufacturer or an endorser for a false advertisement with/without imprisonment up to 2 years after a conclusive investigation under Section 21 of the Act. [8]

The ASCI is a non-statutory, self-regulatory body that provides general rules regarding advertising to ensure the authenticity of representations and claims made by advertisements, and to safeguard against misleading advertisements. It provides that the advertisement must mandatorily display a disclaimer stating ‘past results are no guarantee of similar future outcomes and results may vary’.

The Trademarks Act, 1999 consents comparative advertising using other company’s trademark. Section 29(8) of this Act provides relief for infringement of a registered trademark if the advertisement takes unfair advantage based on dishonest practice or is detrimental to its distinctive character. [9]

The Competition Act, 2002 was enforced to foster healthy competition in the Indian market and restrict adverse practices like the formation of cartels to regulate price and abuse of dominant position. A complaint about fraudulent advertisement may be filed with the Competition Commission of India under Section 3 of this Act. [10] This was observed ancillary in the dissenting judgement delivered by DK Sikri in Re Vishal Gupta and Albion Info Tel Limited. [11]

All the remaining legislations that are the Drugs and Cosmetic Act, 1940 under Rule 106, the Drugs and Magic Remedies (Objectionable Advertisement) Act, 1954 under Section 3 and 5, the Bureau of Indian Standards Act, 1988 under Rule 7, The Infant Milk Substitute, Feeding Bottles and Infant Foods (Regulation of Production, Supply, and Distribution) Act, 1992 under Section 3, the Cable Television Networks Regulation Act, 1995 under Section 6, Cigarettes and other Tobacco Products (Prohibition of Advertisement) and Regulation of Trade and Commerce, Production, Supply, and Distribution) Act, 2003 under Section 5, and the Food Safety and Standards Act, 2006 under Section 24, converge at one point of argument that is misleading or fraudulent advertisements should not be published or broadcasted.

These extensive, nonetheless, overlapping and fragmented legislations are riddled with inadequacies like some are archaic while others provide ineffective implementation mechanisms. Moreover, when read together, they create an ambiguous atmosphere for the regulation of advertisements.

Conclusion

The current comprehensive legislative framework has failed miserably. Thus, the need of the hour is well-framed legislation which in unequivocal words demarcates the rights and responsibilities of consumers and business organisations to protect them from unfair trade practices. It should not only address the current deficiencies effectively but also provide a holistic approach towards the apprehensive insufficiencies of law that may arise due to the ever-evolving technological world.

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FAQS

Q. What is the market-size distribution of Advertisements in India?

Ans. Print contributes a significant portion to the total advertising revenue, accounting for almost 41.2 per cent, whereas TV contributes 38.2 per cent, and digital contributes 11 per cent of the total revenue. Outdoor, Radio and Cinema make up the balance 10 per cent.

References

[2] Vasudevan Mukunth, ‘With New Cure for Covid-19, Patanjali Continues to do Science by Press Release’ (The Wire 24 June 2020) <https://thewire.in/the-sciences/patanjali-baba-ramdev-covid-19-cure> accessed 7th August 2020.

[3] Neetu Chandra Sharma, ‘61 Companies face heat for misleading health advertisements’ (Livemint 3rd April 2019) <https://www.livemint.com/companies/news/61-companies-face-heat-for-misleading-health-ads-1554276451323.html> accessed 7th August 2020.

[4] Ibid.

[5] Ibid.

[6] Editor, ‘ASCI Bans 82 Ads, Including L’Oreal, Amity, India Today, Flipkart For Misrepresentations’ (The Logical Indian 7 October 2015) <https://thelogicalindian.com/news/asci-bans-82-ads-including-loreal-amity-flipkart-india-today-for-misrepresentations/> accessed 7th August 2020.

[7] Editor, ’25 out of 33 Patanjali Advertisements were False: ASCI’ (The Logical Indian 20 January 2017) <https://thelogicalindian.com/story-feed/awareness/patanjali-misleading-advertisements/> accessed 7th August 2020.

[8] Ministry of Law and Justice, ‘Consumer Protection Act, 2019’ (Bare Act 9 August 2019) <http://egazette.nic.in/WriteReadData/2019/210422.pdf> accessed 7th August 2020.

[9] Legislative Department of India, ‘Trademarks Act, 1999’ (Bare Act 30 December 1999) <http://legislative.gov.in/sites/default/files/A1999-47_0.pdf> accessed 7th August 2020.

[10] Legislative Department of India, ‘Competition Act, 2002’ (Bare Act 13 January 2003) <https://www.cci.gov.in/sites/default/files/cci_pdf/competitionact2012.pdf> accessed 7th August 2020.

[11] Vishal Gupta v. Google LLC & Others, C. No. 06 of 2014.