1.    Introduction

Misleading advertisements are a rampant phenomenon in India, undermining consumer confidence and market equity. Misleading advertisements generally make false claims about the nature of products or services, make false promises, or amount to unfair trade practices, as contemplated under Section 2(28) of the Consumer Protection Act, 2019.[1] Recent judicial pronouncements, as the Supreme Court rebuking Patanjali Ayurved for disseminating misleading information, underpin the need to tackle this phenomenon.[2] The Advertising Standards Council of India (ASCI) has seen a sharp increase in complaints, 81% of which were against misleading claims, highlighting the need for stringent regulation.[3]

The role of a legal framework in regulating deceptive advertisements cannot be emphasized enough. Legislation like the Consumer Protection Act, 2019, and the Drugs and Magic Remedies (Objectionable Advertisement) Act, 1954, offers essential guidelines to advertisers and prescribes punishment for non-compliance.[4] The Central Consumer Protection Authority (CCPA), which has been set up under the Consumer Protection Act, 2019, is responsible for enforcing such regulations and safeguarding consumer rights.[5] The Food Safety and Standards Act, 2006, also deals specifically with misleading advertisements in respect of food products.[6] Even with these initiatives, there remain challenges, especially with the growth in digital advertising, which represents 85% of the ads on the watch list and has a lower adherence rate than conventional media.[7]

The current research intends to critically examine the current legal framework regulating false advertisements in India. The goals are to review the existing laws and regulations, including the Consumer Protection Act, 2019, and the regulatory bodies’ role, including the CCPA and ASCI. The research methodology will be a thorough review of legal cases, including the Patanjali Ayurved case, and data analysis from ASCI’s Annual Complaints Reports. Through analysing the efficacy of the existing framework and pinpointing what can be improved, this research aims to offer suggestions for enhancing legal protection against deceptive advertising and making consumers more aware of regulations that exist. This will include analysing the effects of recent guidelines and sanctions administered by the CCPA, in addition to investigating how online platforms can be more effectively regulated to dissuade deceptive advertising. In the end, the objective is to help foster a more open and equitable advertising culture in India.

2.    Legal Framework Governing Misleading Advertisements in India

The legal framework regulating misleading advertisements in India is a multifaceted intersection of several statutes and regulations aimed at safeguarding consumers against fraudulent practices. Central to this framework is the Consumer Protection Act, 2019, which clearly defines misleading advertisements as advertisements that give false indications about products or services, make false promises, or are unfair trade practices via express representation.[8] This Act gives power to the Central Consumer Protection Authority (CCPA) to oversee and penalize false advertisements, with a fine of ₹10 lakhs in the case of first-time violations and ₹50 lakhs for repeat violations. The CCPA can also prevent endorsers from endorsing for three years in repeated offenses.[9]

Another important act is the Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act), which deems misleading advertisements as unfair trade practices. While the MRTP Act has been repealed and substituted by the Competition Act, 2002, its provisions on unfair trade practices continue to find relevance in appreciating the historical context of regulation of misleading advertisements in India.[10] The MRTP Act provided for orders of declarations of agreements in respect of false advertisements to be made void or altered by the Commission, and disobedience of such orders was an offense under the law.[11]

The Food Safety and Standards Act, 2006 also has an important role to play, especially in the regulation of false advertising of food products. Section 53 of the Act criminalizes false advertising, and the Food Safety and Standards Authority of India (FSSAI) requires advertisements to be honest, clear, and scientifically proven. The FSSAI employs the Food Safety and Standards (Advertisements & Claims) Regulations, 2018 specifically to regulate food-related advertisements, supplementing the CCPA’s general regulatory power over goods and services.[12]

Apart from these legislative provisions, self-regulatory organizations such as the Advertisement Standards Council of India (ASCI) also contribute significantly to ensuring ethical standards in advertising. ASCI’s Code of Advertising Practice ensures that advertisements are honest and not deceptive, providing a code of conduct for ethical advertising practices in India. While ASCI is not a statutory organization, its guidelines are widely accepted and adhered to by advertisers to prevent possible legal consequences under other laws.[13]

Also, the Ministry of Information and Broadcasting (MIB) has played a key role in increasing transparency in advertisements, with the launch of self-declaration certificates for advertisements concerning food and health products being a significant measure. The focus of this drive is to keep advertisers and ad agencies on their toes, promoting accountability, just as the overarching legal framework targets consumer protection.[14] The Indian Constitution also indirectly affects advertising laws by safeguarding freedom of speech and expression, though reasonable restrictions, to enable regulation of commercial advertisements that are likely to mislead consumers.[15]

However, the legal framework governing misleading advertisements in India is robust and multi-faceted, involving both statutory provisions and self-regulatory mechanisms. While there are challenges in enforcement and criticisms regarding the effectiveness of these regulations, they collectively form a comprehensive system aimed at safeguarding consumer rights and promoting truthful advertising practices.

[1]The Consumer Protection Act, 2019, Section 2(28).

[2]Urvashi Joshi &Malabika Boruah, Supreme Court’s Contempt Notice To Patanjali: An Analysis, Live Law (Apr. 9, 2024, 11:46 AM), https://www.livelaw.in/law-firms/law-firm-articles-/supreme-court-contempt-notice-patanjali-fast-moving-consumer-goods-indian-medical-association-objectionable-advertisements-naik-nail-co-254671.

[3]Sekhar, et al., “81% of ad violations were on account of misleading claims in FY24: ASCI,” The Economic Times, available at: https://economictimes.indiatimes.com/industry/services/advertising/81-of-ad-violations-were-on-account-of-misleading-claims-in-fy24-asci/articleshow/110340193.cms?from=mdr (Accessed: 6 March 2025).

[4]N. Kushawah, “No More Misleading Ads: Centre Mandates Self-Declaration Certificate For Advertising Agencies”, Live Law, 2024. Available at: https://www.livelaw.in/lawschool/articles/misleading-advertisement-patanjali-case-self-declaration-certificate-celebrities-influencers-consumer-protection-advertising-agencies-261264 (Accessed: 6 March 2025).

[5]Gupta, G., “Role of Central Consumer Protection Authority: An Analysis under Consumer Protection Act, 2019” 3 MagLaw 77-89 (2024).

[6]J.P. Nehf, “Misleading and unfair advertising”, in Handbook of Research on International Consumer Law, Second Edition 90-110 (Edward Elgar Publishing, 2018).

[7]Sekhar, et al., “81% of ad violations were on account of misleading claims in FY24: ASCI,” The Economic Times, available at: https://economictimes.indiatimes.com/industry/services/advertising/81-of-ad-violations-were-on-account-of-misleading-claims-in-fy24-asci/articleshow/110340193.cms?from=mdr (Accessed: 6 March 2025).

[8]Vikrant Rana & Apalka Bareja, Misleading Ads: Everything You Need To Know, Live Law (Aug. 14, 2024, 11:15 AM), https://www.livelaw.in/law-firms/law-firm-articles-/misleading-ads-advertising-regulation-act-ministry-of-information-and-broadcasting-consumer-protection-act-tata-motors-ss-rana-co-266693.

[9]Economic Laws Practice, Guidelines on Misleading Advertisements in India (ELP Law, 2024), available at https://elplaw.in/leadership/guidelines-on-misleading-advertisements-in-india/ (last accessed Mar. 7, 2025).

[11]D.P.S. Verma, “Regulating Misleading Advertisements: Legal Provisions and Institutional Framework” 26 Vikalpa 51 (2001).

[12]D.P.S. Verma, “Regulating Misleading Advertisements: Legal Provisions and Institutional Framework” 26 Vikalpa 51 (2001).

[13]Pardeshi, S.K., “Food Safety and Standards Act (FSSA) 2006 (34 of 2006): Its Legal Provisions, Penalties and Offences”, (2019) 8(7) International Journal of Engineering, Science and Mathematics, pp. 78-91.

[14]Vikrant Rana &ApalkaBareja, Misleading Ads: Everything You Need To Know, Live Law (Aug. 14, 2024, 11:15 AM), https://www.livelaw.in/law-firms/law-firm-articles-/misleading-ads-advertising-regulation-act-ministry-of-information-and-broadcasting-consumer-protection-act-tata-motors-ss-rana-co-266693.

[15]A.A. Patil, “Misleading Advertisements in India: A Comparative and Critical Analysis”, 7 IUP Law Review page numbers (2017).