India’s Supreme Court is examining whether the legal framework for resolving consumer disputes should base jurisdiction on the price paid for goods or services, or on the compensation sought, amid ongoing legal debates on fairness and statutory interpretation.
The Supreme Court of India has asked the central government to explain whether consumer forums should decide their jurisdiction by the price paid for goods or services, or by the compensation a complainant seeks. The court’s concerns came up in a case that has exposed a wider tension in consumer law: whether the current structure fairly reflects the scale of a dispute, or instead pushes some cases into the wrong forum.
Appearing for the petitioner, senior advocate Gagan Gupta argued that tying jurisdiction to the value of consideration paid can produce odd results. He told the court that a buyer who spent ₹2.5 crore on a car but only wants a defective windscreen repaired may be pushed to the National Commission, while another consumer who paid a ₹40 lakh advance and is complaining only about delayed delivery would be sent to a district commission. Gupta also questioned how the system should treat fixed deposit holders and savings account holders, who do not directly pay for banking services in the usual sense, as well as patients receiving free or subsidised treatment.
The court has now directed the Centre to file an affidavit explaining both the logic behind the current framework and the 2021 notification that cut the National Commission’s pecuniary jurisdiction from ₹10 crore to ₹2 crore. According to Bar and Bench, the bench highlighted the possibility that consumers who pay heavily for a product may seek only modest relief, while others may claim larger compensation for smaller outlays, raising doubts about whether the present test is the best way to sort disputes.
The issue also comes against the backdrop of recent Supreme Court rulings upholding the Consumer Protection Act, 2019. In April 2025, the court sustained the constitutional validity of key provisions, including Sections 34, 47 and 58, and accepted that jurisdiction should be based on the consideration actually paid rather than the amount claimed in compensation. Those rulings were said to rest on the idea that consumers should not be able to inflate claims simply to choose a preferred forum, and that the statutory hierarchy of district, state and national commissions has a rational basis.
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