Should Advocates Be Held Liable Under the Consumer Protection Act?

M.R Mishra
Mar 6
5 min read

In a Significant judgment delivered on May 14, 2024, the Supreme Court of India addressed a critical question:

Can advocates be held liable for "deficiency in service" under the Consumer Protection Act (CP Act), 1986, as re-enacted in 2019? The case, Bar of Indian Lawyers Through its President Jasbir Singh Malik v. D.K. Gandhi PS National Institute of Communicable Diseases and Anr., has far-reaching implications for the legal profession and consumer rights in India.

The Supreme Court, in a unanimous decision, held that advocates cannot be held liable under the Consumer Protection Act for alleged deficiencies in their professional services. The Court ruled that the legal profession is sui generis (unique) and that the services provided by advocates fall under a "contract of personal service", which is explicitly excluded from the definition of "service" under the CP Act. This judgment has set aside the earlier decision of the National Consumer Disputes Redressal Commission (NCDRC), which had held that complaints against advocates for deficiency in service were maintainable under the CP Act.

What's The Matter?

The case originated from a complaint filed by D.K. Gandhi against an advocate, Jasbir Singh Malik, alleging deficiency in service. Gandhi had hired Malik to represent him in a case involving a dishonored cheque. During the proceedings, the accused agreed to pay the amount of the cheque along with additional expenses.

However, Gandhi alleged that Malik did not deliver the payment to him and instead demanded additional fees. Gandhi filed a complaint before the District Consumer Disputes Redressal Forum, seeking compensation for mental agony and harassment.

The District Forum ruled in favor of Gandhi, holding that it had jurisdiction to adjudicate the matter. However, the State Commission reversed this decision, stating that the services of advocates did not fall within the ambit of the CP Act. On appeal, the NCDRC held that complaints against advocates for deficiency in service were maintainable under the CP Act. This led to the present appeal before the Supreme Court.

What Happened in Court?

The Supreme Court framed the following key issues for consideration:

Whether a complaint alleging "deficiency in service" against advocates is maintainable under the Consumer Protection Act, 1986/2019?
Whether the services provided by advocates fall within the definition of "service" under the CP Act?
Whether the legal profession is sui generis and distinct from other professions?
Whether the services provided by advocates are under a "contract of personal service," thereby excluding them from the purview of the CP Act?

The Court began by examining the legislative intent behind the enactment of the Consumer Protection Act. It noted that the primary objective of the CP Act was to protect consumers from unfair trade practices and unethical business practices by traders and manufacturers. The Act was designed to provide a speedy and inexpensive remedy for consumers in disputes related to goods and services.

The Court emphasized that the legislature never intended to include professions or services rendered by professionals (such as advocates, doctors, etc.) within the purview of the CP Act. The Act was specifically aimed at regulating commercial activities and business transactions, not professional services. The Court observed that if professional services were brought under the CP Act, it would lead to a flood of litigation in consumer forums, thereby frustrating the very purpose of the Act.

Sui Generis , The Court held that the legal profession is sui generis, meaning it is unique and cannot be compared with other professions. The role of advocates is not merely commercial; it is an extension of the justice delivery system. Advocates play a crucial role in upholding the rule of law, protecting the rights of citizens, and ensuring the independence of the judiciary. The Court noted that the legal profession has always been held in high esteem and is considered a noble profession. further observed that the success of the judicial system depends on the independence of the Bar.

Advocates owe a duty not only to their clients but also to the court and the administration of justice. This unique nature of the legal profession distinguishes it from other professions, such as medicine or engineering, where the relationship between the professional and the client is more transactional.

Contract of Personal Service. The Court examined whether the services provided by advocates fall under a "contract of personal service", which is excluded from the definition of "service" under Section 2(42) of the CP Act, 2019. The Court noted that in a client-advocate relationship, the client exercises a considerable amount of direct control over the manner in which the advocate renders their services. Advocates are bound to follow the instructions of their clients and cannot act independently without their client's consent.

The Court referred to the provisions of the Code of Civil Procedure (CPC) and the Advocates Act, 1961, which govern the relationship between advocates and their clients. It observed that advocates are agents of their clients and owe fiduciary duties to them. The Court concluded that the services provided by advocates are under a contract of personal service, and therefore, they are excluded from the definition of "service" under the CP Act.

Indian Medical Association Case

The Court also addressed its earlier decision in Indian Medical Association v. V.P. Shantha (1995), where it had held that medical professionals could be held liable under the CP Act for deficiency in service. The Court noted that the legal profession is fundamentally different from the medical profession. While medical professionals provide services that are more tangible and measurable, the services provided by advocates are intellectual and advisory in nature, often involving complex legal issues.

The Court expressed the view that the decision in the Indian Medical Association case needed to be revisited by a larger bench, as it did not adequately consider the unique nature of the legal profession. The Court referred the matter to the Chief Justice of India for consideration by a larger bench.

The Court also examined international practices regarding the inclusion of legal professionals under consumer protection laws. It noted that in many countries, including Malaysia, Canada, and the United States, legal professionals are excluded from the purview of consumer protection laws. The Court emphasized that the legal profession is a regulated profession, and its exclusion from consumer protection laws is consistent with international norms.

In its final decision, the Supreme Court held that the Consumer Protection Act, 1986/2019 was not intended to include professions or services rendered by professionals, such as advocates, within its purview, emphasizing that the legal profession is sui generis and distinct from other professions. The Court ruled that the services provided by advocates fall under a "contract of personal service", thereby excluding them from the definition of "service" under the CP Act, and concluded that complaints alleging deficiency in service against advocates are not maintainable under the CP Act.

The Court set aside the NCDRC's judgment and allowed the appeals, marking a significant victory for the legal profession by safeguarding the independence of the Bar and ensuring advocates can perform their duties without fear of consumer forum litigation.

However, the judgment raises questions about accountability and redressal mechanisms for clients affected by advocate negligence or misconduct, as the existing disciplinary framework under the Advocates Act, 1961 may need strengthening.

The decision strikes a balance between protecting the integrity of the legal profession and ensuring clients have access to justice, reaffirming that the legal profession is a noble calling vital to upholding the rule of law and protecting citizens' rights.

This landmark judgment underscores the need for advocates to maintain the highest standards of professionalism while preserving the unique role of the Bar in India's justice system

Case Title: Bar of Indian Lawyers Through its President Jasbir Singh Malik v. D.K. Gandhi PS National Institute of Communicable Diseases and Anr.

Case Number : Civil Appeal No. 2646 of 2009

Date of Judgment: 14 May 2024

Judges: