Greenwashing and Consumer Protection Law in India: Bridging the Enforcement Gap

Introduction 

In October 2024, the Central Consumer Protection Authority (“CCPA”) notified India’s first  dedicated regulatory framework aimed at a practice that had, until then, operated largely at the  margins of legal scrutiny: greenwashing, the use of false, vague or unsubstantiated  environmental claims to market goods and services. Rising consumer demand for sustainable  products has turned environmental credentials into a powerful marketing tool, but that same  demand has created strong incentives for exaggeration. Terms such as “eco-friendly” and  “sustainable” are routinely used without supporting evidence, misleading consumers, distorting  competition between genuinely sustainable businesses and their less scrupulous rivals, and  concealing environmental harm that Articles 14 and 21 of the Constitution, as interpreted to  encompass a right to a healthy environment, are intended to guard against.  

This article argues that although India now possesses a reasonably comprehensive statutory and  regulatory architecture for addressing greenwashing, spanning the Consumer Protection Act,  2019, the CCPA’s 2024 Guidelines, the Companies Act, 2013, and the SEBI Business  Responsibility and Sustainability Reporting framework, that architecture is significantly  undermined by weak enforcement. Section II sets out the legal framework governing  environmental claims in India. Section III examines the case law on misleading and comparative  advertising that continues to shape how such claims are assessed. Section IV critically evaluates  the enforcement gaps in the current regime. Section V draws a comparative perspective from the  European Union and the United States. Section VI proposes specific reforms, before the article  concludes. 

Legal Framework 

The Consumer Protection Act, 2019 

The foundation of India’s response to greenwashing lies in the Consumer Protection Act, 2019,  which prohibits unfair trade practices and misleading advertisements and empowers the CCPA to 

investigate complaints, order the discontinuation of offending advertisements, and impose  penalties on manufacturers, advertisers and endorsers. A first-time contravention attracts a fine  of up to ₹10 lakh and imprisonment of up to two years repeat contraventions attract fines of up to  ₹50 lakh and imprisonment of up to five years, and the CCPA may additionally bar an endorser  from making further endorsements for up to three years.  

The Greenwashing Guidelines, 2024 

Because the 2019 Act addresses misleading advertising in general terms, the CCPA notified the  Guidelines for Prevention and Regulation of Greenwashing or Misleading Environmental  Claims, 2024 to address environmental claims specifically. The Guidelines prohibit the use of  vague or generic terms, including “eco-friendly”, “green”, “sustainable” and “carbon-neutral”  unless such claims are qualified and substantiated. Substantiation may take the form of  certification by a statutory or credible authority or internally verifiable evidence maintained by  the business itself the Guidelines stop short of requiring mandatory independent third-party  verification for every claim. Comparative environmental claims, where one product or service is  presented as greener than another, must additionally rest on data that is verifiable and disclosed  to consumers.  

Corporate Disclosure Obligations 

The Companies Act, 2013 requires qualifying companies to constitute a corporate social  responsibility committee and to report on related spending, creating an indirect disclosure trail  against which environmental claims can be measured. In addition, the SEBI Business  Responsibility and Sustainability Reporting framework mandates that the largest companies  based on market capitalization have to report their performance in the environment, society, and  governance areas using standard metrics, with certain core metrics having reasonable assurance. The Environment (Protection) Act, 1986 supplies the underlying substantive obligations such as  pollution control and waste management standards, against which the truth of an environmental  claim is ultimately tested.  

III. Case Law Analysis 

India has not yet produced a body of case law decided specifically under the Greenwashing  Guidelines, 2024, given their recent notification. The applicable jurisprudence instead comes from a longer line of comparative and disparaging advertising cases, which remains directly  relevant because it establishes the evidentiary standard that any claim of environmental  superiority must meet.  

In Dabur India Ltd v Colortek Meghalaya Pvt Ltd, the Delhi High Court considered a television  advertisement for a mosquito-repellent cream that Dabur alleged disparaged its own product by  implying that rival creams caused rashes and allergies. The Court held that comparative  advertising is permissible and protected as commercial speech, but that any assertion made  within it must have a reasonable factual basis puffery is permitted, but an unsubstantiated claim  that denigrates a competitor’s product is not.  

This standard was applied in the later dispute between Hindustan Unilever’s Domex and Reckitt  Benckiser’s Harpic toilet cleaners, litigated across two related appeals. In the first, the Delhi  High Court restrained Hindustan Unilever from airing a television commercial that it found, on  the facts, to disparage Harpic. In the second, decided the following year, the Court again applied  the reasonable-factual-basis test, holding that a claim which is technically true in isolation may  nevertheless render an advertisement misleading if its overall effect on a consumer is deceptive.  Read together, these cases confirm that a claim need not be literally false to attract liability; it is  enough that the claim, viewed as a whole, creates a false impression in the mind of the ordinary  consumer. This is precisely the standard that an unsubstantiated environmental claim, such as an  undefined assertion of being “carbon-neutral” would be expected to fail once tested. 

Critical Evaluation: Enforcement Challenges 

The principal weakness in India’s framework is not the substance of the law but its enforcement.  Four gaps stand out. 

First, financial penalties remain modest relative to the advertising budgets of large national and  multinational businesses. A maximum fine of ₹10 lakh, rising to ₹50 lakh for repeat  contraventions, is unlikely to function as a meaningful deterrent for a company whose annual  marketing spend runs into hundreds of crores of rupees; a recent CCPA order against a ride hailing platform for misleading promotional advertising, capped at the statutory maximum of  ₹10 lakh, illustrates the ceiling within which even large-scale campaigns are currently penalised. 

Second, the Guidelines permit substantiation through a business’s own internally verifiable  evidence rather than requiring independent third-party verification in every case. This leaves  considerable room for self-serving certification, particularly where the CCPA lacks the technical  capacity to interrogate the underlying data. 

Third, regulatory responsibility is fragmented across the CCPA, SEBI, the Ministry of  Environment, Forest and Climate Change, and voluntary self-regulatory bodies such as the  Advertising Standards Council of India, with no single authority responsible for coordinating  environmental-claims enforcement across sectors. 

Fourth, consumer awareness of what a credible environmental claim looks like, and of the  existence of a complaint mechanism through the CCPA, remains limited, reducing the volume of  complaints that might otherwise drive enforcement. 

Comparative Perspectives 

The European Union initially proposed the most stringent regime among major jurisdictions. Its  draft Green Claims Directive would have required mandatory third-party verification and life cycle assessment for explicit environmental claims. However, the European Commission  announced its intention to withdraw the proposal in June 2025 following objections, principally  from the European People’s Party, that its compliance burden was disproportionate for small and  medium enterprises, and the scheduled trilogue negotiations were cancelled shortly afterwards.  The Directive’s prospective withdrawal does not, however, leave the Union without a binding  framework: the Empowering Consumers for the Green Transition Directive, already in force and  due for transposition by member states by March 2026 and application from September 2026,  separately bans generic and unsubstantiated environmental claims and unverified sustainability  labels. Enforcement under the wider EU consumer protection regime permits fines of up to four  per cent of a trader’s annual turnover for widespread infringements, a figure that dwarfs the  fixed-sum penalties available under Indian law.  

The United States relies on the Federal Trade Commission’s Green Guides, which set out the  evidentiary standard that environmental marketing claims must meet and are enforced through  the Federal Trade Commission’s general power to act against deceptive practices. Unlike the Indian and EU regimes, the Green Guides are not binding rules in themselves but interpretive  guidance, though their practical effect on advertising practice has been considerable. 

Set against these models, the Indian regime sits closer to the American approach in substance,  given its reliance on general consumer-protection enforcement rather than a bespoke liability  statute, but without the FTC’s decades of accumulated Green Guides jurisprudence, and with  penalty levels considerably below either comparator. 

Proposals for Reform 

Four reforms would materially strengthen the existing framework without requiring wholesale  legislative reconstruction. First, penalties under the Consumer Protection Act, 2019 should be  recalibrated to scale with a company’s turnover or advertising expenditure, rather than remaining  fixed, so that the sanction is proportionate to the scale of the deception rather than merely an  operating cost. Second, mandatory independent verification should be required, at minimum, for  quantitative or comparative environmental claims, where the risk of consumer deception and  competitive harm is highest, even if a lighter self-certification standard remains available for  general claims. Third, the CCPA, SEBI and the Ministry of Environment, Forest and Climate  Change should formalise a coordinating mechanism, whether through a memorandum of  understanding or a joint task force, to close the gaps that arise from fragmented sectoral  oversight. Fourth, sustained consumer education on how to recognise credible sustainability  claims and certifications would increase the volume and quality of complaints that drive  enforcement in the first place. 

VII. Conclusion 

Greenwashing is not merely a marketing irritant it undermines consumer trust, distorts  competition between genuinely sustainable businesses and their rivals and obscures  environmental harm at a time when India faces acute and worsening ecological pressures. The  Consumer Protection Act, 2019, the CCPA’s Greenwashing Guidelines, 2024 and the disclosure  obligations under the Companies Act, 2013 and the SEBI Business Responsibility and  Sustainability Reporting framework together represent a genuinely comprehensive legal response  and the case law on comparative advertising supplies a workable evidentiary standard for testing  environmental claims.

As this article has argued, however, the architecture is only as strong as its enforcement and on  that measure the current regime falls short: penalties remain modest, verification remains largely  voluntary, oversight remains fragmented across multiple regulators and consumer awareness  remains low. Recalibrating penalties to scale with turnover, requiring independent verification  for the claims most likely to mislead, coordinating enforcement across regulators and investing  in consumer education would together close much of this gap. Until they are addressed, India’s  otherwise robust legal framework against greenwashing will continue to promise more protection  than it is able to deliver. 

Reference(S):

Cases 

Dabur India Ltd v Colortek Meghalaya Pvt Ltd (2010) 44 PTC 254 (Del) (DB). 

Reckitt Benckiser (India) Ltd v Hindustan Unilever Ltd, FAO(OS)(COMM) 149/2021 (Delhi  High Court, 26 September 2022). 

Hindustan Unilever Ltd v Reckitt Benckiser (India) Pvt Ltd, FAO(OS)(COMM) 157/2021, 2023: DHC:2528-DB (Delhi High Court, 13 April 2023). 

Tata Press Ltd v Mahanagar Telephone Nigam Ltd (1995) 5 SCC 139. 

Legislation and Regulatory Instruments 

Constitution of India 1950. 

Consumer Protection Act 2019 (India). 

Companies Act 2013 (India). 

Environment (Protection) Act 1986 (India). 

Central Consumer Protection Authority, Guidelines for Prevention and Regulation of  Greenwashing or Misleading Environmental Claims, 2024 (notified 15 October 2024).

Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)  Regulations 2015, reg 34(2)(f) (Business Responsibility and Sustainability Reporting  framework). 

Directive (EU) 2024/825 of the European Parliament and of the Council of 28 February 2024  (Empowering Consumers for the Green Transition Directive). 

Directive 2005/29/EC of the European Parliament and of the Council of 11 May 2005 (Unfair  Commercial Practices Directive), as amended. 

European Commission, Proposal for a Directive on Green Claims, COM (2023) 166 final. 

Federal Trade Commission, Guides for the Use of Environmental Marketing Claims, 16 CFR pt  260 (US). 

Secondary Sources 

Press Information Bureau, Government of India, ‘Central Consumer Protection Authority Issues  Guidelines for Prevention and Regulation of Greenwashing and Misleading Environmental  Claims’ (2024). 

Beveridge & Diamond, ‘India’s Central Consumer Protection Authority Proposes Guidelines to  Regulate Greenwashing’ (National Law Review, March 2024). 

Latham & Watkins, ‘European Commission Announces Intention to Withdraw EU Green Claims  Directive Proposal’ (June 2025). 

Consumer Guidance Society (CAG), ‘How India’s Greenwashing Guidelines Can Protect  Consumers’ (2024).