Deceptive and false advertising is not only unethical; they distort competition and, of course, consumer choice. An advertisement becomes misleading or false when suppose an advertisement of a water purifier that filters only bacteria (and not viruses) claims that it gives 100 percent safe water, then it is a false statement or if an advertisement for a face cream claims that it removes dark spots on the face and even prevents them from coming back, the manufacturer should be able to prove this. Or else, it is a deceptive advertisement.

Section 2(1) (r) of Consumer Protection Act, 1986 defines the term 'unfair trade practices.- Unfair trade practice means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice including any of the false and deceptive practice. Other such protection acts are Monopolies and Restrictive Trade Practices Act 1969, the main objective of the MRTP Act is to ensure that the operation of economic system does not result in the concentration of economic powers in the hands of a few hands but MRTP generally did not include any provinces against misleading and false advertisement but the 1984 amendments in MRTP Act incorporated, inter alia, new provisions for the regulation of unfair trade practices e.g. false representations, misleading advertisements, bargain sales, bait and switch selling, hoarding and destruction of goods etc.

An advertisement is said to be deceptive if it misleads people, changes reality and influences consumer buying behavior. In most jurisdictions, advertising regulations make it illegal to use false or misleading advertising. It is illegal to misrepresent the quality of any product, or its related specifications related to its Composition, manufacture, price or place of origin. "false" refers to the misrepresentation of the facts; false information can result in an unacceptable number of people using the information to make wrong decisions, but consumers are vulnerable to advertising when presented with a unique environment.

In June 2022, to protect consumer rights against wider advertising issues, the CCPA notified the Guidelines on Prevention of Misleading Advertisements and Endorsements for Misleading Advertisements, 2022 with immediate enforcement.

The Guidelines provide added protection to consumer rights with clear and mandatory conditions for valid and non-misleading advertisements, and free claims advertisements. Further, the Guidelines recognize and allow bait advertisement on fulfilling prescribed conditions, as well as provide mandatory requirements for disclaimers in advertisements, advertisement endorsements, and disclosure of connection between endorser and trader. Besides, the Guidelines prohibit surrogate advertising, and prescribe restrictions on free claims advertisements and advertisements targeted towards children. The duties of manufacturers, service providers, advertisers and advertising agencies are outlined in detail under the Guidelines.

The salient features of the Guidelines are as follows:

  1. Scope: The Guidelines is applicable to all advertisements (regardless of form, format and medium), and to all manufacturers, service providers, traders, advertising agencies and endorsers associated with the advertisements. This brings both private and public advertisements and associated entities under the ambit of the Guidelines.
  2. Non-misleading and valid advertisements (Clause 4, Guidelines): The following qualify as valid and non-misleading advertisements:
    • Contain truthful and honest representation;
    • Non-misleading consumers through exaggeration of the product or service's accuracy, scientific validity, practical usefulness, capability or performance;
    • Do not present consumers' legal rights as the offer's distinctive feature;
    • In case there are specific informed or scientific opinion in the advertisement claims, it should not suggest the advertisement to contain universally-accepted claims;
    • In case of failure to purchase the advertised goods or services, it must not mislead the consumers or their families of the nature or extent of risk to their personal security;
    • Non-misleading consumers about the unsubstantiated claims, which are merely based on publications;
  3. Bait advertising (Clause 5, Guidelines): The Guidelines recognize bait advertisements as those which advertise goods, product, or service for sale at a low price to attract consumers. Clause 5 of the Guidelines prescribe mandatory conditions for bait advertisements, as discussed below:
    • Advertisements must not entice consumers to purchase goods or services lacking reasonable prospect of sale.
    • Adequate supply of goods or services must be ensured by the advertiser to meet the foreseeable demand.
    • In case of default in meeting the supply of advertised goods or services, the advertiser must provide the reasons for the default, and more specifically, about the limited stock and the advertisement's purpose to assess potential demand, as applicable. Further, consumers must not be misled by omission of any applicable geographic or age-limit restrictions for the advertised goods or services.
    • In case of unfavorable market conditions, the advertisements must not mislead consumers about such conditions or unavailability of the advertised goods or services, and must not induce the consumers to buy those goods or services at less favorable condition
  4. Under the Guidelines, an advertisement disclaimer may clarify claims or resolve ambiguities, without contradicting the material claims, messages, or dictionary meaning of words used in the advertisement. However, the disclaimers must not conceal material information or commercial intent so as to deceive consumers, and must also not attempt to rectify a misleading claim. The disclaimer's requirements and circumstances substantially correspond to those set forth in the Code of Self-Regulation by the Advertising Standards Council of India.
  5. Penalties: The Guidelines seek to keep advertisers in check against misleading or false advertising practices. For violation of provisions related to misleading advertisements under the Guidelines, the CCPA can impose a penalty of INR 10 lakhs on manufacturers, advertisers and endorsers. For subsequent violations, the CCPA may impose a penalty extending up to INR 50 lakhs. As per the CPA, the CCPA may also prohibit the endorser of a misleading advertisement from making any endorsements for up to one year, which can extend to 3 years on subsequent non-compliance.


While the Guidelines deal with surrogate advertisements, however, there is lack of clarity on what kinds and extents of surrogate advertising are permitted under the Guidelines. Many liquor and tobacco brands have used music festivals, goods and tours as advertising platforms to indirectly drive consumption of their alcoholic and non-alcoholic beverages. Such brands have now sought the Indian government's clarity on whether claims of "responsible drinking" or "don't drink and drive" are permissible in surrogate advertisements. Nonetheless, the Guidelines give legality to the permissible and non-permissible advertising standards in India. The provisions related to bait advertising, free claims advertising, children targeted advertisements and endorsements definitely are positive leaps towards ensuring protection of consumer rights as well as encouraging genuine advertisements with better consumer awareness and trust.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.