Theme: Money & Property

Mediation as a mode of Consumer Dispute Settlement

Mediation(( Section 2(25), Consumer Protection Act, 2019)) is an out-of-court settlement where the parties can decide the manner of the proceedings. It helps the speedy settlement of disputes.

The Consumer Protection Act, 2019 has introduced the provision where the relevant Commission can refer a consumer dispute for mediation, when there is a scope of settlement between the parties(( Section 37(1), Consumer Protection Act, 2019)). However, parties to the mediation are given a time frame of 5 days to accept or reject the process of mediation, as consent is vital for it(( Section 37(2), Consumer Protection Act, 2019)). Once a dispute is referred to mediation, the fee paid to the Commission for dispute redressal is refunded to the parties(( Rule 5, Consumer Protection (Mediation) Rules, 2020)).

Process of Mediation

The mediation proceeding may be conducted in the following way:

Step-1: It would be held at a ‘Consumer Mediation Cell’ which would have a panel of mediators to settle disputes. This cell maintains a list of cases and records(( Regulation 11(7), Consumer Protection (Mediation) Regulations, 2020)) of the proceedings(( Section 74, Consumer Protection Act, 2019)).

Step-2: Every mediator is expected to act fairly and judiciously while deciding the matter(( Section 77, Consumer Protection Act, 2019)). A fee is also paid to the mediator before the proceedings begin(( Rule 8(6), Consumer Protection (Mediation) Rules, 2020)).

Step-3: Mediation would be conducted in the presence of both parties(( Regulation 11(1), Consumer Protection (Mediation) Regulations, 2020)) and will remain confidential(( Regulation 12, Consumer Protection (Mediation) Regulations, 2020)).

Step-4: The parties must provide all the relevant information and documents to the mediator(( Regulation 11(6), Consumer Protection (Mediation) Regulations, 2020)).

Step-5: If the parties come to an agreement after the mediation proceedings within 3 months(( Regulation 11(2), Consumer Protection (Mediation) Regulations, 2020)), a ‘settlement report’ would be forwarded to the Commission along with the signatures of the parties(( Sections 80 (1) and 80 (2), Consumer Protection Act, 2019)).

Step-6: The concerned Commission is required to pass an order within the 7 days of receiving the ‘settlement report’ of the parties(( Section 81(1), Consumer Protection Act, 2019)).

Step-7: In case no agreement has been reached through mediation, the same is communicated to the Commission through a report of proceedings. The Commission would then hear the issues of the concerned consumer dispute and decide the matter(( Sections 80(3) and 81(3), Consumer Protection Act, 2019)).

Step-8: A dispute cannot be taken to other proceedings, like arbitration or court litigation, once it has undergone the mediation procedure(( Rule 6, Consumer Protection (Mediation) Rules, 2020)).

Complaints which cannot be settled by mediation

However, the following matters cannot be referred to mediation(( Rule 4, Consumer Protection (Mediation) Rules, 2020))

  • Serious medical negligence or one that results in death.
  • Fraud, forgery, coercion.
  • Applications for compounding of offences(( Section 96, Consumer Protection Act, 2019)) by either of the parties.  This means that proceedings about these offences can be settled between the parties upon the payment of fine unless the commission of such offence has recurred in a span of 3 years(( Sections 88 and 89, Consumer Protection Act, 2019.)).
  • Criminal offences and public interest issues. These include issues concerning the public who are not parties to the case. For example, violation of privacy in terms of electronic bank transactions on e-commerce platforms.

 

Maximum Customer Liability and Bank Policy

The maximum a customer of a Basic Savings Bank Deposit Account can be liable for is Rs 5,000.

All other Savings Bank Accounts, Pre-paid Payment Instruments and Gift Cards, Current/ Cash Credit/ Overdraft Accounts of Micro, Small and Medium Enterprises, Current Accounts/ Cash Credit/ Overdraft Accounts of Individuals with annual average balance (during 365 days preceding the incidence of fraud)/ limit up to Rs.25 lakh. Credit cards with limit up to Rs.5 lakh, the maximum they are liable for is Rs. 10,000

For all other Current/ Cash Credit/ Overdraft Accounts and credit cards with limit above Rs.5 lakh, they can be liable up to Rs 25,000.

If the delay is for more than seven working days, the customer liability will be determined as per the Bank’s Board Policy:

  • Banks should provide the details of their policy in regard to customers’ liability formulated at the time of opening the accounts.
  • Banks should also display their approved policy in public domain for wider circulation.
  • The existing customers must also be individually informed about the bank’s policy.

How can NRIs and PIOs sell property?

NRIs and PIOs can sell property in India in accordance with the Master Circular.(( RBI’s Master Circular on Acquisition and Transfer of Immovable Property in India by NRIs/PIOs/Foreign Nationals of Non-Indian Origin, 2013)) An NRI can sell property in India to a person resident in India or an NRI or a PIO. A PIO can sell property in India to a person resident in India, an NRI or a PIO – with the prior approval of RBI. NRIs and PIOs are permitted to sell agricultural land /plantation property/farm houses only to a person resident in India who is a citizen of India.

Process for Electronically Filing Taxes – Online Filing

The online electronic filing (e-filing) mode is applicable only for ITR forms 1 and 4, which you can fill directly online.

Step 1: Select Income Tax Return (ITR) Form

For online mode, you have to directly login to the Income Tax Department’s e-filing portal and select either ITR-1 or ITR-4. If you want to know which ITR Form is applicable to you, read here.

Step 2: Prepare your ITR Form online

Select the ‘e-File’ menu and then the ‘Income tax return’ page. You will have to select the assessment year, ITR form number. You will also select whether your ITR is an original/revised return. Further, you can then access your form by selecting the ‘Prepare and submit online’ option.

Step 3: Fill in Details

Read the instructions carefully. Ensure that you fill the form completely and provide all the necessary details correctly. Click on the ‘Save Draft’ button periodically to save the entered ITR details as a draft. You can do this to avoid loss of data/rework due to session timeout. The saved draft will be available for 30 days. However, this means 30 days from the date of saving or till the date of filing the return.

Note that ​​​​​​​​​​ITR forms are attachment less forms and, hence, you are not required to attach any document (like proof of investment, TDS certificates, etc.) along with the return of income. Keep these documents safely with you as they make be asked by the tax authorities or officers in situations like assessment, inquiry, etc.

Step 4: Submit the form

After filling the form, you have to choose the appropriate verification option in the ‘Taxes Paid and Verification’ tab. You have several options for verifying your form, and can choose to verify your form at the time of submission or later.

Once the verification is done, you can check your ITR status here.

Registration or Notarization of Agreement

Registration of Rent/ Lease Agreement

If your lease agreement is for a year or more, it is compulsory to register it with the office of the sub-registrar of the city you are living in. It must be registered within 4 months from when the lease agreement was made. If the agreement is not registered, it will not be accepted as evidence by court, if or when a case if filed in relation to the rented property.

Registration of your agreement is also a measure to ensure that your landlord does not charge you anything extra apart from what was already agreed upon or coerce you into any illegal transactions.

This is the reason why most agreements are for a period of 11 months, so as to avoid this registration process. In such cases, you need not register the agreement, but only notarise it.

However, in some cities, like Mumbai, where a leave and license agreement is used, it is compulsory to register the agreement, irrespective of the duration of tenancy. In Maharashtra, all agreements of tenancy, be it lease or leave and license, must be compulsorily registered by law.

Notarising Your Agreement

It is necessary to notarise any kind of rental agreement, if it is not being registered. This is because the agreement between you and your landlord is a contract and all contracts are usually validated by a notary. Notarising the agreement gives validity to your document and also affirms that the parties signing the agreement are in fact who they are. This not only ensures you of your rights and duties, but in case the matter goes to court, a notarised agreement is likely to not be disputed.

Consumer Protection Authorities

Given below are the details and functions of all the consumer protection authorities:

Central Consumer Protection Authority(( Chapter III, Consumer Protection Act, 2019))

The Central Consumer Protection Authority (CCPA) aims to promote, protect and enforce the rights of consumers collectively. The CCPA is empowered to:

  • Conduct investigations into violation of consumer rights and start prosecutions on complaints received.
  • Order recall of unsafe goods and services
  • Order discontinuation of unfair trade practices and misleading advertisements
  • Impose penalties on manufacturers, endorsers and publishers of misleading advertisements(( Central Consumer Protection Authority established to promote, protect and enforce the rights of consumers, PIB, accessed at https://pib.gov.in/PressReleasePage.aspx?PRID=1642422.)).

It is headquartered in New Delhi(( Notification by Ministry of Consumer Affairs, Food and Public Distribution dated 23 July, 2020, accessed at https://consumeraffairs.nic.in/sites/default/files/Estt%20of%20CCPA.pdf, but there is also scope to set up regional centers throughout the nation((Section 10(3), Consumer Protection Act, 2019.)). The CCPA can begin to inquire into the mentioned issues either when they receive complaints, or on their own.

Consumer Protection Councils(( Chapter II, Consumer Protection Act, 2019.))

The Central Consumer Protection Council has advisory functions, giving suggestions about the promotion and protection of consumer rights. Similarly, state-level units called State Consumer Protection Councils and District Consumer Protection Councils are also formed which perform similar advisory functions. Some of the other bodies that also perform similar roles (such as spreading awareness) include, Consumer Education and Research Centre (Gujarat) , Bureau of Indian Standards, Federation of Consumer Organization in Tamil Nadu, Mumbai Grahak Panchayat, etc.

 

What should I consider when I am buying a house or land?

One of the most critical aspects to consider when buying a land or house, is knowing whether:

The price of the property is fair 

Since land and property fall under State subjects as per the Constitution of India, laws and transactional rules vary depending on the state where the property is located. Depending on where the property is located and the nature of construction (if applicable), different states have introduced a system of determining a minimum base price for the property, called ‘circle rate’, or ‘ready reckoner rate’. These circle rates are speculative and vary greatly even within the same city- from one area to another- and are frequently updated and notified. In addition to the location-based circle rates, the value of a property is also affected by the services it has access to, and the builder/ housing society. However, these circle rates only serve as guides, and the actual price may vary based on the market value of the property, called fair market value.

The ownership of the property is free of disputes

There are various ways in which you can find out if the ownership of the property you want to purchase is disputed. The simplest way is to check the title deeds of the property in question. You can also enquire with the local tehsildar’s office or that of the village officer where the property is located. Other documents such as e-record of rights, property tax receipts, and survey documents are also used to establish ownership.

Assessment/ITR Verification

The last step of the Income Tax Return (ITR) filing process is verification. You have to file your ITR verification within 120 days of filing the tax return. If you don’t do so, then it means that you have not filed ITR.

These are the several ways in which you can electronically verify your ITR at the time of filing your ITR:

  • Digital Signature Certificate (DSC) – Along with your ITR form, attach the signature file generated from DSC management utility.
  • Aadhaar OTP – Enter the Aadhaar OTP you receive in your mobile number registered with UIDAI.
  • Electronic Verification Code (EVC) using Prevalidated Bank Account Details, or using Prevalidated Demat Account Details – Enter the EVC received in the mobile number registered with Bank or Demat Account respectively. Validity of such EVC is 72 hours from the time of generation.

There is no requirement to send documents to the Income Tax Department if you want to verify your tax return electronically. If you verify your ITR using an electronic method, then you will immediately receive the confirmation from the Tax Department regarding verification. Read more about e-verifying your return here.

Verifying at a later time

You can also choose to verify at a later time. If you don’t want to e-verify the ITR, you can instead send the signed ITR-Verification through normal or speed post to “Centralized Processing Center, Income Tax Department, Bengaluru – 560500”.

When you send the ITR-Verification via post to the Income Tax Department, they will send you an email confirming its arrival. This means your ITR is verified. The email will be sent to the email address you have registered in your e-filing account on the Income Tax Department’s e-filing website.

Income Tax Department’s Processing of Tax Returns

After the return is verified, either via e-verification or physically, the Income Tax Department will start processing your tax return. This is to ensure that the details filled by you are correct as per the Income Tax Act. The authorities may also cross-check details with you.

In order to make an income tax assessment, the Assessing Officer may serve a notice on any person who has not submitted an income tax return on time, to make the person submit the return. The Officer can also ask you to produce any accounts or documents required by the Officer. The income tax authorities can ask you to submit or verify any information.  Further, this may include a statement of all your assets and liabilities. (( Section 142(1), Income Tax Act, 1961))

Once the return is processed, the Department communicates it to your registered email ID. If there are errors, you have to explain further or correct the mistakes made while filing the original ITR.

How to register a rent agreement

Follow the steps given below to register your rent agreement. In most cases, your broker will help you through this process.

Step 1

Once the agreement is ready, pay the relevant stamp duty amount.

Step 2

Book an appointment with the sub-registrar of your sub-district. Most states have set up an online appointment system.

Step 3

The landlord/licensor, tenant/licensee and two witnesses must visit the sub-registrar’s office at a given time as per the appointment, along with the following documents:

  • Agreement with duly paid stamp duty
  • Two recent passport size photos of tenants, landlord and witnesses
  • Identity proof of tenants, landlord and witnesses (Aadhar card, Election ID card, Passport, Government issued ID card, Identification verified by gazetted officers).

Step 4

Finally, to complete registration, pay the relevant registration fees while submitting the documents mentioned above.