Chapter III - Central Consumer Protection Authority
Section 21
Section 21: CCPA directions and penalties for misleading ads
Section 21 gives the CCPA powers over false or misleading advertisements after investigation, including modification or discontinuation directions and specified penalties.
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This article is for general information. Refer to the Consumer Protection Act, 2019 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(1) Where the Central Authority is satisfied after investigation that any advertisement is false or misleading and is prejudicial to the interest of any consumer or is in contravention of consumer rights, it may, by order, issue directions to the concerned trader or manufacturer or endorser or advertiser or publisher, as the case may be, to discontinue such advertisement or to modify the same in such manner and within such time as may be specified in that order.
(2) Notwithstanding the order passed under sub-section (1), if the Central Authority is of the opinion that it is necessary to impose a penalty in respect of such false or misleading advertisement, by a manufacturer or an endorser, it may, by order, impose on manufacturer or endorser a penalty which may extend to ten lakh rupees: Provided that the Central Authority may, for every subsequent contravention by a manufacturer or endorser, impose a penalty, which may extend to fifty lakh rupees.
(3) Notwithstanding any order under sub-sections (1) and (2), where the Central Authority deems it necessary, it may, by order, prohibit the endorser of a false or misleading advertisement from making endorsement of any product or service for a period which may extend to one year: Provided that the Central Authority may, for every subsequent contravention, prohibit such endorser from making endorsement in respect of any product or service for a period which may extend to three years.
(4) Where the Central Authority is satisfied after investigation that any person is found to publish, or is a party to the publication of, a misleading advertisement, it may impose on such person a penalty which may extend to ten lakh rupees.
(5) No endorser shall be liable to a penalty under sub-sections (2) and (3) if he has exercised due diligence to verify the veracity of the claims made in the advertisement regarding the product or service being endorsed by him.
(6) No person shall be liable to such penalty if he proves that he had published or arranged for the publication of such advertisement in the ordinary course of his business: Provided that no such defence shall be available to such person if he had previous knowledge of the order passed by the Central Authority for withdrawal or modification of such advertisement.
(7) While determining the penalty under this section, regard shall be had to the following, namely: — (a) the population and the area impacted or affected by such offence; (b) the frequency and duration of such offence; (c) the vulnerability of the class of persons likely to be adversely affected by such offence; and (d) the gross revenue from the sales effected by virtue of such offence.
(8) The Central Authority shall give the person an opportunity of being heard before an order under this section is passed.
Introduction
A section 21(1) direction can address a trader, manufacturer, endorser, advertiser or publisher. The penalty and endorsement-ban subsections have different targets and conditions: do not assume that every participant faces the same consequence.
The Authority must offer a hearing before making an order. The provision also includes endorser due-diligence and ordinary-course publisher defences with their own limits.
Key takeaways
Withdrawal or modification
Following investigation, the Authority may direct the relevant participant to stop or modify a false or misleading ad within the order's time.
Penalties vary by role
Manufacturer or endorser penalties under subsection (2) may reach ₹10 lakh, or ₹50 lakh for later contraventions; subsection (4) addresses a person publishing or party to publication with a separate ₹10 lakh ceiling.
Endorsement ban and safeguards
An endorser can face a ban of up to one year, or up to three years for a later contravention. The provision separately recognises verified due diligence and a qualified ordinary-course publishing defence.
Check the complete advertisement
Retain the creative, placement, dates, target audience and supporting evidence for every express and implied claim. Assess the full impression, not only a disclaimer.
Identify each participant's statutory role
Map the trader, manufacturer, endorser, advertiser and publisher. Subsections (1)–(4) do not impose identical penalty powers on all roles.
Document diligence and respond to a direction
Endorsers should preserve verification steps. Publishers should document ordinary-course publication and any knowledge of a withdrawal or modification order. Use the hearing opportunity and then comply with any operative order.
Hypothetical example
An online advertisement claims a supplement cures a condition without substantiation. The CCPA reviews the claim, responsible parties and any correction direction or penalty; the brand retains approvals and evidence supporting each ad version.
Official sources
Practical checklist
Do
- Substantiate objective claims before publication.
- Keep endorser verification and publisher instruction records.
- Track ad versions and promptly implement a valid modification or withdrawal order.
Avoid
- Do not quote ₹10 lakh or ₹50 lakh as an automatic fine.
- Do not assume an endorser or publisher defence applies without its statutory facts.
Frequently asked questions
Can CCPA require an ad to be changed?
Yes. Section 21(1) allows a direction to discontinue or modify a qualifying false or misleading ad after investigation.
Does every publisher automatically pay a penalty?
No. Subsection (4) has its own conditions, and subsection (6) contains a qualified ordinary-course defence.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026