The Cost of Misleading Advertising in India
Introduction
Misleading advertising remains a significant concern for consumer protection authorities worldwide. In India, the Consumer Protection Act, 2019, along with the Advertising Standards Council of India (ASCI) Code and recent guidelines issued by the Central Consumer Protection Authority (CCPA), impose clear obligations on advertisers to ensure that marketing claims are truthful, substantiated, and not misleading.
A recent decision by the District Consumer Disputes Redressal Commission (Delhi) in Nikhil Jain v. Emami Limited (Complaint No. 53/2013) highlights how even well-known brands may face serious consequences when advertisements create unrealistic expectations among consumers. The case involved claims made by Emami Limited regarding its men's fairness cream, Fair and Handsome, and provides important lessons on the boundaries of permissible advertising practices.
This article analyses the case, the legal principles applied, and the broader implications for advertisers seeking to navigate compliance obligations under Indian consumer law.
Background: The Promise of Fairness
Nikhil Jain, the complainant, purchased "Fair and Handsome," a men's fairness cream marketed aggressively by Emami Limited. The packaging and advertising promised visible fairness within three weeks, reinforced by images, skin tone progressions, and celebrity endorsements. After using the product exactly as instructed, Jain saw no improvement and alleged that the product did not deliver the promised benefits.
Feeling misled, Jain initiated a consumer complaint seeking punitive damages of ₹19,90,000 (approximately USD 24,000) and litigation costs, coupled with demands for corrective advertising.
Emami's Defense
Emami Limited responded with a multi-pronged defense:
- The product was developed using scientific research and quality control.
- The fairness results depended on additional factors like diet, hygiene, exercise, and lifestyle, not solely the product's use.
- The absence of medical or dermatological evidence by the complainant weakened his claim.
- Emami further contended that the claims had been reviewed and endorsed by the ASCI, which had not found any violation of advertising norms regarding Fair and Handsome. Emami argued that ASCI's satisfaction should weigh heavily against the allegations of unfair trade practices.
The Commission's Role and Jurisdiction
The District Consumer Disputes Redressal Commission (now functioning under the Consumer Protection Act, 2019) is a quasi-judicial body established to adjudicate consumer complaints where the value of goods or services and compensation claimed does not exceed ₹1 crore.
The Commission has wide powers to:
- Direct the removal of defects or deficiencies in goods or services;
- Award compensation for loss or injury suffered by consumers;
- Issue corrective advertising orders to neutralize misleading impressions; and
- Impose punitive damages where warranted In exercising its jurisdiction, the Commission applies not only the statutory provisions of the Consumer Protection Act, 2019 (CPA), but also self-regulatory standards such as the ASCI Code and relevant guidelines issued by the CCPA.
The Commission's Analysis
The Commission found that the advertising and packaging of Fair and Handsome created a misleading overall impression. By suggesting that fairness could be achieved solely by using the product as directed, Emami was held to have engaged in an unfair trade practice as defined under Section 2(47) of the CPA.
Importantly, the Commission observed that no disclosure was made regarding other factors such as diet, hygiene, and lifestyle, which could materially affect the product's effectiveness. Under both the ASCI Code and the CCPA Guidelines for Prevention of Misleading Advertisements (2022), omission of material information constitutes a misleading advertisement.
While no inherent defect in the product's formulation was proven, the Commission noted that the failure to deliver the promised results rendered the product "defective" in terms of Section 2(10) of the Act — defining a defect to include any shortcoming in quality, quantity, or standard.
Emami's defense that the advertisement had passed ASCI review was rejected. The Commission clarified that while ASCI's Code provides important ethical standards, it does not bind judicial authorities. Compliance with ASCI Guidelines does not immunize an advertiser if, on independent judicial assessment, the overall communication is misleading.
The expert evidence produced by Emami was found inadequate. The affidavits and studies relied upon were generic, lacked claim-specific evaluation, and failed to substantiate the advertisement's specific promises as required under both the Consumer Protection Act and the ASCI Code's substantiation standards.
Recognizing the need for deterrence, the Commission exercised its powers under the CPA to impose punitive damages amounting to ₹15,00,000 (approximately USD 18,000). ₹14,50,000 was directed to be deposited into the Delhi State Consumer Welfare Fund, and ₹50,000 was awarded directly to the complainant.
Further, Emami was directed to immediately withdraw the misleading packaging and advertisements.
Key Takeaways
- Disclosure Must Be Proactive and Prominent: Brands must proactively disclose all factors that materially affect product efficacy. Under the ASCI Code and the CCPA's Guidelines, non-disclosure — even by omission — amounts to misleading advertising.
- Visual Storytelling Can Mislead Too: Imagery, charts, and visual metaphors (such as "skin tone meters") are scrutinized just like words. Brands must ensure that visual cues do not overpromise results.
- Endorsements Are No Shield Against Liability: Even regulatory compliance or ASCI clearance does not immunize brands. The CCPA Guidelines mandate that endorsements must reflect genuine, verifiable consumer experience.
- Expert Substantiation Should Be Robust and Specific: Reliance on generalized studies or non-specific endorsements is insufficient. Advertisers must maintain credible, claim-specific, ready evidence to defend advertising assertions.
- Prepare for Punitive Exposure: District-level consumer forums have the power to award significant punitive damages. Legal teams must anticipate this in their risk assessments.
Conclusion
Nikhil Jain v. Emami Limited serves as a reminder that advertising is not merely about creativity and persuasion — it is a legal and ethical engagement with the consumer. Misleading advertising may bring not only regulatory penalties but also judicial rebuke, damages, and lasting brand harm.
This reminder comes against a broader backdrop of heightened vigilance. According to ASCI's Half-Yearly Complaints Report 2024–25, 3031 advertisements were scrutinized for violations in just six months, with 98% requiring modification and 69% of violations pertaining to dishonest or misleading representations.
For advertisers, the case highlights the importance of ensuring that every claim, every endorsement, and every visual representation can withstand both regulatory and judicial scrutiny.
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.
