consumer protection act 1986 essay

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An Overview of the Consumer Protection Act ,1986

It was with the emergence of the free market economy that the concept of “consumer is king”, widely followed and accepted.  The 20 th century was marked by the advent of consumerism where there were frequent trade wars and conflicts between market share holders with a constant need to be better than the rest. This resulted in stiff competition with the traders resorting to unfair trade practises & manipulating the customers and took advantage of the lack of knowledge of the purchasers.

Soon, there was a need to put an end to this and that gradual shift was noted with the growing prominence of the notion “caveat venditor” meaning “Let the buyers beware” instead of previously accepted “caveat emptor” meaning “Let the Sellers beware”. –The establishment of Caveat Venditor held the seller responsible for any defective goods sold or for any unfair services rendered.

The leading case of Donoghue v Stevenson  is considered to be the landmark judgment for laws relating to product liability where the manufacturer was held liable for the court for the presence of snail in ginger beer. This was a hallmark in cases relating to consumer protection opening floodgates and called for the need of legislations to take care of the consumers and to protect their interests.

Consumer protection , however, was found not to be limited just to one single legislation but involved amendments and reissuing of multiple such statutes as that of the Sale of Goods Act, 1930, Essential Commodities Act, 1955 and the Competition Act, 2002 being the few of those many legislations which promoted the concept of ‘Consumerism’.

Consumer protection is now restricted not just to the protection of rights but also to the promotion of consumer interests and to encourage legislations keeping in mind the welfare of the people and in furtherance of their multifarious interests.

Under Consumer Protection Act, 1986 (COPRA), Consumer Councils were set up at the Centre, State and District levels with appellate and pecuniary jurisdiction. Cases over 1 crore came under the Centre council and cases between 20 Lakhs to 1 Crore were discussed in the State council and anything below that were in the District Levels.

After signing the United Nations General Assembly Resolution No. 39 of 248, in 1985 India found the need to draft a legislation to protect the interest of the consumers.. All the remedies available to the consumers before then were mainly punitive in nature & not compensatory.  Due to the high cost of litigation, consumers were never really benefitted and the whole long-drawn legal process became a non-profitable one. This called for the need of a legislation that would provide compensation as well and thus came into being, the Consumer Protection Act, 1986.

Consumer Protection Act, 1986: An Insight

The development of a nation is often measurred by multiple parameters ; and economic well-being invariably becomes a crucial parameters. This involves transactions and other dealings and at one end of such trades, are the consumers whose rights ought to be protected. Hence, it was important for a country like India to have legislations that dealt with promotion of interests of consumers and thus came about the legislation of Consumer Protection Act, 1986 .

With the rapid expansion in trade and commerce, the traders had an unfair upper hand over the consumers and this was a direct consequence of industrialisation.Consumers had little or no knowledge about the rights available to them and hence were pushed to a disadvantage.

 But, it was only in 1986 that the law-makers of the nation decided to structure and streamline the efforts made towards protecting consumers’ interests and stressed for the need of a welfare legislation in the form of the Consumer Protection Act, 1986.

The introduction of the COPRA in 1986 was to protect the interests of the consumers and to safeguard their rights as well. It provided a multi-dimensional approach to promote consumer interests which included spreading of awareness and establishment of consumer councils.  This provided a platform for the consumers to settle consumer disputes. It also envisioned this to be a medium that would facilitate a faster and efficient way for redressal.

The aim and objective along with the purpose for which the act was established, is explained under Section 6, 8 and 8B of the Consumer Protection Act, 1986. Section 6 goes on to detail the rights which the act aims to protect and lists them as:

• Right to safety of life and property from hazardous goods.
• Right to information about the quality, quantity, potency, purity, standard and price of goods and services so as to protect consumers against unfair trade practices.
• Right to choice as to variety of goods and services.
• Right to be heard and representation and to be assured that consumer interests will receive due consideration at appropriated platform.
• Right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers.
• Right to consumer education

Consumer Protection Act: Definitions Over the Years

The rights enshrined in Section 6 of the act were considered to be inalienable and was determined not to be squashed in between any unfair trade practices and helped any prudent consumer in their course of redressal.

Classification The Actdetermined that in case of any violation of these rights, complaints could be raised and the act provided various provisions which defined what ‘complaints’ were and who all were entitled to raise those. Section 2 (1) (b) of the act placed the ‘complainants’ into 5 categories:

• A consumer;
• Any voluntary consumer organization registered under the companies’ act, 1956 or under any other law for the time being in force;
• The central government or the state government;
• One or more consumers or class action suit
• Legal heir of the consumers

Section 2 (1)(c) further goes on to define what all can constitute a ‘complaint’ and inclusively defines all issues against which the consumers can have a cause of action.

VCOs The act was amended twice in both 1993 and 2002. The 1993 amendment was significant with respect to how it gave an opportunity to Voluntary Consumer Organisations (VCOs) to file Public Interest Litigations on behalf of a large number of consumers using a combined reading of both the provisions of Section 2(1)(b)(iv) and Section 2(1)(b)(ii).

Class Action Section 2(1)(b)(iv) allows one or more consumers to file a class action suit which proved to be the medium for multiple consumers with a common cause to come together and raise their query before the concerned body of justice. This provision was further exemplified and the amendment came about in the wake of the 1993 case of Mumbai Grahak Panchayat v Lohia Machines Limited .

Mumbai Grahak Panchayat v Lohia Machines Limited

More than 100 people had registered for the purchase of scooters from LML and had paid the registration fees of 500 Rupees.

After promising the delivery of the scooters within a specific time, the consumers cancelled their registration and called for the refund of the registration fees upon non-delivery of the scooters.

A class-action suit was filed on behalf of all the aggrieved consumers and by virtue of the introduction of claims under PIL as well, people who had not filed the class action suit were also entitled to receive the compensation and the court ordered the compensation to the tune of 400 million rupees and took care of the interests of the consumers.

National Seeds Corporation v M. Madhusudhanan Reddy

Section 2(1)(d) of the act explained as to who all would fall under the ambit of the definition of ‘consumers’. In the case of National Seeds Corporation v M. Madhusudhanan Reddy , the definition of a consumer under Section 2(1)(d)(i) was expanded in order to include farmers and reinforced its role as a welfare legislation.

This case also helped clear the fog regarding the interpretation of Section 3 of the legislation. It was decided here that the objective of the Consumer Protection Act was to offer compensatory relief in addition to any other provision in another act existing at that time. It was specifically emphasised that the provisions in COPRA would only be in addition and never in derogation to the laws that existed during that time.

There were multiple such instances over the years that proved time and again that the Consumer Protection Act, 1986 was a welfare legislation with provisions included in order to protect and promote the interests of the consumers. The various amendments made both in 1993 and 2002, kept in mind the interests of the people and the widening of the scope of a class action suit under Section 2(1)(b)(iv) was symbolic of that intention.

Consumer Protection: Role Played by Voluntary Consumer Organisations (VCOs)

In addition to the protection of consumer interests, there is an added burden on the legislation to facilitate methods so as to improve awareness amongst the consumers. They also have a responsibility to enable speedy justice to the consumers in distress. In order to bring this about, there were groups of organisations called the VCOs that were formed. These VCOs acted as platforms that would make sure that the voices of the consumers were heard and they were well represented.

Section 2(1)(b)(ii) of the legislation gives the VCOs a locus standi to represent the consumers in their cause of action. It is the constant interference of the VCOs that encourage such manufacturers and traders to provide a certain level of quality in their productions and thereby, increases the standard of consumption.

By virtue of such constant checks enforced on the traders, the stigma of monopoly is also thereby abolished providing a scope for competition in the free market with everyone trying to outsmart the other in terms of quality of goods and services.

By means of judicial activism, such VCOs are often able to influence the decisions made by the consumers’ courts and courts in order to favour the people and their interests. A writ petition issued by VOICE called for the intervention of the Supreme Court which made laws on adulteration more stringent and strict and try to diminish the loopholes.

This was exemplary of the power that VCOs had in asserting authority and affecting the decisions made by the parliament in favour of the interests of the consumers.

Even though there are numerous benefits that VCOs bring to the table, there are often multiple problems that the VCOs face in their course of addressing the concerns of the consumers. Due to the lack of awareness amongst the consumers, there are very few occasions where people approach the VCOs asking them to take up their cause.

But this was solved by the 1993 amendment which gave VCOs the right to file PILs on behalf of a large class of consumers who were aggrieved but did not have any means to redressal.

Then arose the problem of funding and added on to the list of challenges faced by the VCOs. Even though the VCOs were to funded by the Consumer Welfare Fund found in 1992, it does not quite solve the problem of accessibility to people who are generally illiterate and often end up being victimised at the hands of the traders who get the better of them.

 Due to lack of sufficient funds, the VCOs are often forced to turn to the Government for help. This leads to biases.

VCO which is supposed to work as an organisation aimed at protecting consumer interests often end up favouring the Government in cases where it is at fault due to its dependency on the Government for funds.

Despite all these challenges that the VCOs face, there are a plethora of services that they have on offer, the chief of them being, the promotion of right to representation and the right to information. But there is of course a long way to go in consumer protection and there is a whole array of things which needs improvement and deserves attention.

Judgments That Left a Mark: Guarding Rights and Interests

General Manager Telecom, BSNL v Krishnan

In the 2009 case of General Manager Telecom, BSNL v Krishnan , the jurisdiction of the consumer forum was challenged.

The point of contention was as to whether the consumer had a course of action under Section 7B of the Indian Telegraph Act or under the Consumer Protection Act, 1986.

It was ruled in favour of the former. This called for a broad expansion of the scope of Section 3 of the Consumer Protection Act and was further clarified in the 2012 case of J. Subramanian v M/s. Bharti Airtel   where in it was held that the provisions in COPRA would be in addition and not in derogation to the provisions of any other act existing at that time.

The Consumer Protection Act, 1986 was enacted as a statute so as to initiate better protection of the consumers and also to enable adjudication of consumer disputes. It was further envisioned to act as an effective alternative remedy.

In the case of Buddhist Mission Dental College v Bhupesh Khurana , capitation fees were paid under the belief of false advertisement when the students availed the services of a college which offered attractive facilities and prospects on paper but failed to materialise in reality.

It was found in this case that none of the facts mentioned were true and hence considered the advertisements to be misleading. The final judgment was given to the tune of considering imparting of education to be a service which was reaffirmed with the paying of fees and was ruled that the inability to offer the services advertised constitute deficiency of services and hence determined the cause of action for the consumers and expanded the scope of Section 2(1)(d).

Deputy Registrar v Ruchika Jain

The case of Deputy Registrar v Ruchika Jain , distinguished and differentiated between the services rendered by the educational institutions in terms of imparting education and conducting exams.

As previously determined, the provision for educational facilities were considered under the ambit of ‘services’ as defined under the act while that of conducting exams was considered to be a statutory function.

It was therefore held that a student appearing for the exams could not be considered to be a consumer within the meaning of Section 2(1)(b) read along with Section 2(1)(o) as they had not hired or availed the services of the educational institutions.

This decision was further reaffirmed in the 2009 judgment of Bihar School Examination v Suresh Prasad Sinha which also held that the conducting of exams did not come under the definition of ‘services’ as explained in the act but was merely a statutory function.

Spring Meadows Hospital v Harjol Ahluwalia

Due to the medical negligence of the staff of a hospital, a child had died and it was contested before the court in the case of Spring Meadows Hospital v Harjol Ahluwalia , as to whether the parents of the child had a cause of action against the hospital.

It was ruled in favour of the parents by expanding the definition of the ‘consumer’ as under Section 2(1)(d) of the Consumer Protection Act, 1986.

It was held that when the child was taken to the hospital to avail the services of the hospital, they would fall under the definition of a ‘consumer’ as they were a beneficiary of the services. Both the parents and the child were to be included and thus both were entitled to compensation.

This principle was further reinstated in the case of Indian Medical Association v V.P. Shantha  where 12 major conclusions of the judgment were highlighted with ample emphasis being laid on the definition of ‘service’ as under Section 2(1)(o) of the COPRA. This helped to clear the fog regarding the inclusion of the services rendered at hospitals and nursing homes under the definition as mentioned in Section 2(1)(o) of the act.

There were numerous judgments over the years that dealt with protecting the interests of the consumers and thereby, affixed the role of COPRA as a welfare legislation. All these rulings could be bracketed under different headings including education, medical sector, real estate etc. This showed the pervasive nature of the relevance of the COPRA legislation in all walks of free market economy which involved purchase of goods and the rendering of services.

Lack of consumer awareness and the existence of consumers as an unorganised sector are problems that continue to plague the Capitalistic economy. It gives the traders an unfair advantage over the purchasers who are subjected to further market risks. This often leads to the widespread exploitation of consumers and this is where COPRA as a legislation becomes crucial.

In order to protect the long term interests of businessmen and also to keep Government intervention at minimum, it is important for the Government to raise their quality of goods and services and provide an appreciable standard of materials and services to the consumer. The Consumer Protection Act, 1986 is merely a legislation which tries to keep a check on these multiple aspects relating to the promotion of interests of consumers.

Product liability laws existed without a structure internationally up until the judgment of Donoghue v Stevenson and it was only after 1932 that the momentum for the protection of consumer interests picked up and there has been no turning back since then. Even though there were multiple legislations including the Sale of Goods Act, 1930 and Essential Commodities Act, 1955 that existed even then, it was only after that the establishment of COPRA that consumer rights and its protection in India were structured and streamlined in India.

The efficient redressal mechanism linked with this legislation is a highlight and with the establishment of the District Forum, State Commission and the National Commission, speedy justice is ensured. There is also a certain level of autonomy granted to each of these institutions and their linked to each other by means of appeal.

Consumer education and the protection of their interests form the essence of the objective of this legislation. In order to bring this about, the accessibility should be improved by a lot more participation in the rural areas. This is where the role played by VCOs becomes very important.

These organisations often act as platforms where people can raise their concerns and seek redressal. People who are often unaware of the complexities of such proceedings can always approach the VCOs to carry their interests forward.

There are a lot of questions which are yet to answered when it comes to consumer protection and the role played by both the consumers and the Government. We, as consumers, do have the added responsibility to be aware about our rights and to make sure we are not subjected to any unfair trade practises.

Philip is a second year law student at National Law University, Delhi who takes keen interest in constitutional law and matters relating to contemporary affairs of law. He takes profound interest in legal writing.

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Evolution and Development of the Consumer Protection Act

• April 23, 2020
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Shubhangi Gandhi | Rajiv Gandhi National University of Law, Punjab | 14th November 2019

Table of Contents

INTRODUCTION

Consumer Protection Act, 1986, is an act of parliament which was enacted in 1986 to protect the rights of the consumers in the territory of India. It was commenced on 24 December 1986 as the consumer protection act. It is Act No. 68 of 1986.

The statute is regarded as the MAGNA CARTA in the field of consumer protection for checking unfair trade practices (e.g.; black marketing, hoarding, etc.), defects in goods and deficiencies in services provided to the consumers. It not only checks but also gives consumer the right to seek redressal in case he/she has any grievances and the right to be informed about the quality, quantity, potency, purity, standard and price of goods so as to acquire the goods at the rightful prices and not to be harassed by the manufacturers/sellers.

• Magna Carta: Latin meaning the great charter of liberties; the term is often used for a document consisting of fundamental rights and privileges. [1]

The said act gives a consumer 6 rights i.e.

RIGHT TO SAFETY – protection from hazardous goods,

RIGHT TO BE INFORMED – information about the products for weighing alternatives and protection from misleading claims in advertising and labeling,

RIGHT TO CHOOSE – availability of a variety of goods at competing prices, qualities and services ,

RIGHT TO BE HEARD – in case a consumer is not satisfied with a product that he purchased then thy have a right to file a complaint against it and this complaint cannot go unheard,

RIGHT TO SEEK REDRESSAL – in case of injury/grievances the consumer shall have the right to go to court and seek compensation for this said issue,

RIGHT TO CONSUMER EDUCATION – the consumer has a right to be educated about his/her rights as a responsible consumer and should be given due education about the same.

With such rights, there are a number of consumer responsibilities also attached to it so as to maintain a balance. All rights come with a certain degree of responsibility to ensure that no misuse of such rights takes place. These responsibilities include basic things such as being aware of their rights provided to them under the act and should practice the same in case of need, they should be well aware and cautious about the product that is being purchased, in case the product doesn’t meet the standards of expectation or is faulty then a complaint should be filed and not ignored, cash memos should always be asked while making a purchase, standard marks such as ISI, Hallmark etc. should be looked for on a product to ensure quality and authenticity etc.

In India, consumer protection is an upcoming field. The first society for consumer protection in India was CONSUMER GUIDANCE SOCIETY OF INDIA (CGSI) that was established in 1966 whereas in counties like Japan, the USA, etc. consumer protection had started as early 1914.[2] At present time the main agencies for the attainment of consumer protection in India are district consumer disputes redressal forum (DISTRICT FORUM), state consumer disputes redressal forum (STATE COMMISSION) and national consumer disputes redressal forum (NATIONAL COMMISSION).

HISTORICAL PERSPECTIVE

Till the middle 80s, the trend in India was that of a seller’s market. A seller’s market means that the buyer had to come to the seller for the goods instead of the seller marketing and advertising for his own goods.[3] This means that the consumer had to compete to be able to acquire these goods. Such a trend was completely against the tradition in the west and japan where the situation was totally opposite. For e.g.; in the USA or Europe consumers are not required to book a car or LPG gas for cooking or scooter by making a deposit with the company; rather the manufacturer offers credit to the buyers. This is only to attract the consumers, making their goods easier to buy at easier rates and at least terms and conditions. This is so as there is competition in such a market between sellers and not buyers. In India however, the buyers had to compete to acquire a certain product. The marketing policies; terms and conditions for purchase were stringent. For e.g. if in India a consumer wants to purchase a car; such a consumer is required to make a deposit of the certain sum of money in advance before even getting the product.

With time there occurred a shift in the traditional Indian market. It saw shift from the trend of CAVEAT EMPTOR (which means “ let the buyer beware ”; i.e. the buyer had to be aware and conscious of his choice of products and no liability would be of the seller.) to the trend of CAVEAT VENDITOR (which the complete opposite of caveat emptor “ let the seller beware ”; it pinned liability on the seller for the goods they would sell and give an option of redressal to the consumer). Now, the seller had to make efforts to attract the consumers and market their products. This happened through rigorous advertising and competitive advertising techniques. This opened a new avenue and horizon of perspectives to be included in the act because rigorous advertising also included in its false and misleading advertisements to lure in customers; this constituted as an unfair trade practice.

The act was thus revised in 1993, to extend both its coverage and utility to enhance the powers of seeking redressal for the consumer and to extend the scope of the consumers protection act.

The main aims with which the act was established were:

• To give the consumers a right to be shielded against the promotion of goods and services that are a risk to life and property.
• Give them the right to ensure access to a range of goods and services at viable prices.
• Make sure that they are informed about their rights thus the right to consumer education and ensure that consumer protection will be given due consideration at appropriate levels.
• To give consumers the right to be informed about the product they choose to purchase, are informed about its contents, risks, how to use/deal with the product and what to do in case of a mishap.
• Give them the right to search and seek redressal against unfair trade practices or deceitful exploitation of consumers.

With aims, there always is a certain objective that is to be achieved. The main objective of the consumer protection act was to grant shield and stop the feeling of vulnerability for the consumers. [4] It tried to ensure that there is a considerable shift from the traditional caveat emptor to caveat venditor; i.e. the consumers got a certain sense of security and made the manufacturers/sellers accountable for their products and sale. The act gave consumers a certain voice to stand up against the harassment they were facing due to a lack of consumer rights. The act also objectified to ensuring the sustainability of consumer rights. It has its foundation laid at the very causes of the treatment the consumers would face once the transaction has been completed. A product promised and a product delivered should match and if not by virtue of this the law of consumer protection gives many provisions to replace it without getting involved in messy brawls effectively and efficiently.

What falls in a consumer rights act and what doesn’t is an important question to be dealt with. There are certain essentials that constitute the meaning of the terms like a defect, consumer, seller, etc. being talked from the start of the project. A case comes under the ambit of the consumer protection act only if these certain essentials are matched and the scenarios meet the definitions as under the sections of the act. These essentials/definitions are as under:

• CONSUMER: Section 2(d) of the consumer protection act says that a consumer means any person who- (i) buys any good/s for a consideration which has been paid or promised or partly paid or promised, or under any system of deferred payment. (ii) hires or avails any service/s for a consideration which has been paid or promised, or partly paid or promised, or under any system of deferred payment.
• DEFECT: It is any fault or imperfection; can also be a shortcoming in the quantity, quality, potency, purity or standards in a GOOD, which was required to be maintained by or under any law for the time being in force or under any contract expressed or implied.
• DEFICIENCY: This is parallel to the case of defects In case of services. That means; it is the said fault or imperfection in the quality, quantity, potency, purity or standard in a SERVICE, which was required to be maintained by or under any law for the time being in force or under any contract expressed or implied.
• REDRESSAL FORUMS: Consumer dispute redressal forums should be established under clause (a) of section 9 (sec 2(1)(h)); for e.g. district forums, state commission and national commission.
• GOODS: The definition and meaning of goods shall fall under and be the same as assigned to them under the sale of goods act, 1930 (sec 2(7)(i)).
• SERVICES: section 2 (1) (O) provides that service means service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing, insurance, transport, etc. but does not include the rendering of any service free of charge or under a contract of personal service.
• MANUFACTURER: It is defined in the sec (1)(j) of the consumer protection act which includes in its ambit any person who makes or manufactures any goods or part thereof or any such person who doesn’t manufactures the good but assembles any part or claims the end product to be manufactured by himself etc. Thus, all such persons can be held liable under the act.
• PERSON: Under the section; as per sec 2(1)(m), a person includes- a firm (whether registered or not), Hindu undivided family, cooperative society every other association of persons whether registered under the society’s registration act or not. All such persons are entitled under the act to seek redressal and get their grievances solved.
• TRADER: A trader is different from a manufacturer under the act. As per the act a person who sells or distributes any goods for sale and includes the manufacturers thereof within its meaning.
• HAZARDOUS GOODS: The term hazardous goods has not been defined in the Act. The dictionary meaning; however, of the term is dangerous or risky. The term is not only used in terms of goods only as a consumer has the right to make a complaint even when he is not informed about the hazardous nature of the good that he/she thinks of purchasing. This though is not the same in case of hazardous services. The rationale behind this is to ensure not only physical but also the mental safety of the prospective consumer.
•  RESTRICTIVE TRADE PRACTICE: As per section 2 (1) (n) restrictive trade practice means any trade practice which requires a consumer to buy, hire or avail any goods or services as a precedent for buying, availing of other goods.

SALIENT FEATURES

Salient features or facts about something or qualities of something are the most important things about them; the basic ideas. It basically leads to summing up the topic/article/essay and marking up the central ideas around which the article actually revolves around.

The consumer protection act in it has many salient features i.e. the most noticeable or important features. These features can also be said to be the main idea that was to be achieved through the introduction and implementation of the act.

This act aims at providing an overall or wholistic protection to consumers irrespective of any barriers such as caste, class, low priced or high-priced goods, etc. It provides a safeguard regarding defective goods or products and dissatisfactory services; thus under the purview of this act, there is a provision to ban all such activities which might pose a threat to any said consumer. The said act is applicable to the whole of India except for the state of J&K. It aims at protecting consumers against defective and hazardous goods; deficient and inappropriate services and unfair trade practices like hoarding, black marketing, monopolies, etc. by providing three-tier grievances redressal machinery. Consumer courts in India have been established at a district level, state level and one at a national level; if dissatisfied with a said decision a consumer has a choice and right to go appeal to a higher-level forum and then even to the president as the highest form of appeal. It also gives an easy and inexpensive way of seeking redressal to consumers and covers both the public and private sector i.e. private and public suppliers of goods and services. A consumer need not get involved in any kind of hassle or petty brawls for relief. The act, however, has a fixed time frame for settlement for e.g. aggrieved with the order of district forum, the appeal petition may be filed before state commission within 30 DAYS from the date of receipt of order.

CONSUMER PROTECTION ACT 2019

One of the main features of any law is that it has to dynamic. Something is called dynamic when it keeps on adapting and changing itself with time. Thus, we saw the consumer protection act 1986 getting revised and amended from time to time for bringing it in accordance with changes that were taking place in the economic front because of globalization, digitalization, liberalization and because of the new government in power.[5] Such changes called for some major fundamental changes in the existing 1986 legislation for consumer protection to get the practical implementation of the legislation possible and to fulfill the objective with which it was created. The new act brings in its purview many new facets such as advertising claims, endorsements and product liability, etc. all which play a critical role in altering consumer behavior and retail trends in the 21 st century.

OVERVIEW OF THE ACT:

The consumer protection act 2019 has made some new additions and many more amends just to enhance the 86 legislation. For example; the 2019 Act continues to have a three-tier redressal system i.e. at district, state and national level but the pecuniary jurisdiction which means the monetary value of complaints that can be entertained by each of these forums have been increased to reduce burdens on state and national commissions. As higher pecuniary jurisdiction encourages consumers to approach the district forum for complaints up to RS. 1 CRORE. Also, the jurisdiction of these forums has been expanded to allow complaints to be made where the complainant resides or personally works for gain, as opposed to the 86 Act where complaints could only be made where the opposite party resided or personally worked for gain. In such a situation it acted as a deterrent to filing complaints because the complainant had to travel to other parts to pursue their complaints. The admissibility of complaints made to consumer commissions are to be decided within 21 DAYS. This provision was also a part of 1986 Act but as an addition to this the 2019 Act says that if the issue of admissibility of the complaint has not been decided within such time, the complaint shall be deemed to have been admitted. This provision does away with languishing of complaints at a pre-admission stage. This was utterly necessary as this had become a practice especially at the national commission. The 2019 Act also introduces the power of judicial review which is going to allow consumer commission to review their orders thereby reducing the burden faced in form of appeals. [6] The prescribed time for preferring appeals has also become more stringent to ensure timely filing of appeals.

NEW ADDITIONS:

Starting with the most basic, the definition of consumer is changed to include those who make online purchases. [7] Endorsement of goods and services that is mostly done by celebrities, are also being covered within the ambit of the 2019 Act. Moreover, additional onus has been pinned on endorsers apart from manufacturers and services providers to prevent false and misleading advertisements. The definition of “goods” has been amended to include “food” as defined in the food safety and standards act, 2006. This would cover within it the numerous food delivery platform whose trend is particularly on a rising front. Telecom has also been included in the definition of “services” to bring telecom providers within the purview of 2019 act. But, such an addition has not been termed as “telecommunication service” as defined under the telecom regulatory authority of India act; which would have included internet, cellular and data service providers. A significant addition to the 2019 Act is the concept of “product liability”. Under product liability the manufacturers and sellers would be made liable to compensate for any harm caused to the consumer due to defective goods sold or deficient service provided. [8] Another newly added concept is that of “unfair contracts”. This concept is aimed to protect the consumers from unilaterally skewed and unreasonable contracts which lean in favor of manufacturers or service providers. The definition of “unfair trade practices” has been enlarged and enhanced to include electronic advertising which is misleading, refusing to take back or withdraw defective goods or discontinue deficient services, and to refund the consideration within a stipulated time or in its absence in 30 days. It is also included in the purview of offences that if a confidential information is given in confidence and gathered in the course of transaction, gets disclosed. All such inclusions aim at creating more transparency in the marketplace with a view to attain the objective of the act more effectively and efficiently.

CHALLENGES FOR FUTURE:

The new legislation has created a central consumer protection council to regulate matters relating to violation of rights, false and misleading advertisements which are in conflict with the interest of the general public, unfair trade practices and to promote the protection of the rights of the consumers as a class etc. [9] To enforce all such provisions the central authority is empowered to enquire and investigate wing set up and headed by a director-general, analogous to the competition commission of India. While this being a commendable initiative, it is still unclear on how the authority will practically function as existing district collectors have been asked to undertake certain functions of enquiry and investigations. There also an overlap between the investigative wing and search and seizure functions of the district collector which might lead to conflict of interests among the two. The authority to order for reimbursement in case of defective goods or faulty services vets only with the national commission. But the factors on which the national commission shall hear such appeals is unclear. One of the main things unclear at this point of time is that whether the matters currently pending before the respective consumer commissions will continue there or will they be transferred as the jurisdictions have changed on pecuniary basis. Thus, currently a lot of ambiguity might lead to delays and confusions.

But yet the 2019 Act seems to be a positive step towards reformation and development of consumer laws and protection due to dynamic environment and changing sub-economic conditions. It still needs some certainty and definitions of every person’s functions. There are a lot of challenges in that respect but the legislation seems like a step towards the right direction.

COMPENSATION TO THE COMPLAINANTS FOR FRIVOLOUS APPEALS

Case: Delhi Development Authority V. D.C. Sharma[10], 18 February 2014.

FACTS: There was an accidental case of double allotment of a plot by the DDA. The state commission refused to accept the defense that the plot had not been provided to the complainant only for his failure to pay the cost. It was found from the records that the plot had been allotted to another person.

DECISION: National commission dismissed the revised petition for lack of infirmity in the state commission’s judgement and ordered the payment of 5 LAKHS for indulging in unfair trade practices and unduly harassing the respondent for more than 18 years on top of 30 LAKHS compensation.

• This is the development of the consumer protection from a very basic safeguard of rights to also saving malpractices in the name of consumer protection. The aforesaid case shows that there was made a frivolous appeal i.e. a false and foolish appeal. The DDA had sold the plot allotted to the complainants to another party even while the amount was received by them. The question of complainant not complying with demand does not, therefore, arise. There has been default in the performance of the contract by respondent (DDA) and they are therefore liable to pay (back) the amount received…and to provide another flat to him or pay him compensation.

INSURANCE COMPANY TO NOT REJECT CLAIMS ON TECHNICAL GROUNDS      

Case: Om Prakash V. Reliance General Insurance[11] , 4 October 2017

FACTS: The appellant got his truck insured with Respondent. This said vehicle was stolen from Chopanki, Bhiwari, Rajasthan on 23 March 2010. Consequently, a FIR was lodged on 2the very next day. Thereafter, the appellant visited the office of the respondent but the office was found to be closed. Then the appellant went to the place of theft and met the driver and then he went to the concerned police official. On 31 st of march the appellant lodged the insurance claim and submitted the documents asked by the respondent company. The respondent then appointed an official/investigator who confirmed theft. The appellant made several requests and speedy disposal of the insurance claim and after 5 months of no use sent a legal notice. But the respondent-company repudiated the insurance claim of the appellant citing breach of Condition No. 1, i.e. immediate information about the loss/theft of the vehicle.

DECISION: In  Om Prakash v Reliance General Insurance , the Supreme Court     held   that, in the context of a vehicle insurance policy, the mere failure of the vehicle owner to intimate the insurer immediately after the theft of the vehicle should not bar settlement of genuine claims, particularly when the delay in intimation or submission of documents was due to unavoidable circumstances. The Supreme Court further held that an insurer’s decision to reject a claim should be made on valid – not technical – grounds. The Court also noted that the Consumer Protection Act, 1986 is a beneficial legislation that deserves liberal construction. This laudable object should not be forgotten while considering the claims made under the Act.

• The Apex Court in the case observed that an Insurance company shall reject claim on valid grounds. Rejection of the claims on purely technical grounds in a mechanical manner will result in loss of confidence of policy-holders in the insurance industry. If the reason for delay in making a claim is satisfactorily explained, such a claim cannot be rejected on the ground of delay. It is also necessary to state here that it would not be fair and reasonable to reject genuine claims which had already been verified and found to be correct by the Investigator.

To conclude the essay, the consumer protection act all in all tries to save the consumers from getting harassed by manufacturers/traders on a daily basis. It had many objectives, but these were not achieved to their fullest extent. This legislation describes and defines the fundamentals for consumer protection. It has seen many revisions and amends in the past and the most recent one being in 2019 to include in it most aspects and ideas for protecting the consumers to the utmost capability. As the advent of digital era and the social media, the development of the IT sector and e-marketing has ushered a new era of consumers and traders, it has paved way for digital branding as well as new set of consumer expectations. [12] Under the original consumer protection act of 1986, such an ambit of grievances were not covered as they were not foreseen. To include such issues and inculcate new changes on 6 AUGUST 2019, the Indian parliament passed the new consumer protection bill, 2019.

Such a bill covers the E-COMMERCE transactions under it and also enhances pecuniary jurisdiction of the redressal forums. It introduces E-FILING of complaints and mandates the establishment of a CENTRAL consumer protection authority in India. It calls for product liability and penal consequences in case of breaches and unfair trade practices. It has also put up penalties and consequences for misleading advertisements on an e-platform and suggested a provision for alternative disputes resolution. Such a bill tells us about the traditions of marketing in India; beginning from caveat emptor to caveat venditor and now inculcating e-commerce. Moreover, it shows the evolution of India and its understanding about consumer protection. Consumer protection is an important aspect for India to achieve the goals of the preamble as everyone has the right to justice and redressal. The consumer protection act empowers the consumer class to speak up for their rights and have a tool to with which to fight. It not only focuses on the consumers but also put emphasis on the other side of the deal i.e. the manufacturers/sellers as there is also a provision of time bound redressal seeking and the provision of penalties on hoax complaints. ssIt shows the evolution of the consumer protection act from a basic namesake act to becoming one of the most powerful tools for the common masses.

[1] Shattuck, Charles E. “The True Meaning of the Term ‘Liberty’ in Those Clauses in the Federal and State Constitutions Which Protect ‘Life, Liberty, and Property.’”  Harvard Law Review , vol. 4, no. 8, 1891, pp. 365–392.

[2] Ajeet Mahale, “50 Years of protecting Consumer Rights”, The Hindu, 20 April, 2016

[3] Louis E. Boonie, David L. Kurtz, Contemporary Marketing, Cengage Learning, 2012

[4] Shipra Singh, “Here’s how consumers will benefit under the new Consumer Protection Act”, The Economic Times, 19 August, 2019

[5] The Planning Commission of India’s ‘Report of the working group on consumer protection’(2017)

[6] Satvik Varma, “Consumer Protection Act 2019: Enhancing Consumer Rights”, Bar and Bench, 2 September 2019

[8] Supra, Note 4.

[9] Sonam Mhatre, Radhika Nair, “India: Consumer Protection Bill, 2019”, Dhaval Vussonji and Associates, 21 August 2019.

[11] Om Prakash V. Reliance General Insurance, 2017 (9) SCC 724

[12] Klaus Shwab, The Fourth Industrial Revolution, Penguin, United Kingdom, 2017

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Highlights on the Consumer Protection Act, 1986

The below mentioned article provides highlights on the Consumer Protection Act, 1986.

Introduction:

The Consumer Protection Act 1986 was passed by the Indian Parliament to protect consumer rights and to redress consumer complaints and resolve consumer disputes.

Every individual is a consumer of goods and services and expects a fair deal against unfair exploitation.

This Consumer Protection Act applies to the whole of India except the State of Jammu and Kashmir and covers all goods and services purchased by the consumers and to all sectors — private, public and cooperative. The objective of the Act is “to provide for better protection of the interests of consumers and for that purpose to make provisions for the establishment of Consumer Councils and other authorities for the settlement of consumer disputes and for matters connected therewith”. It protects the consumers from unfair trading or unfair trade practices.

ADVERTISEMENTS:

It is important to note that the Indian Consumer Protection Act is a social welfare legislation and has been designed to avoid technicalities, procedural delays, procedural requirement, court fees and costs.

The Consumer Protection Act, 1986 provides for the following rights to the consumers:

(a) Right to be heard and to be assured that consumers’ interests will receive due consideration at appropriate forum;

(b) Right to seek redressal against unfair trade practices or unscrupulous exploitation of consumers; and

(c) Right to consumer education.

The Consumer Protection (Amendment) Act 1993 adds the following consumer rights:

(d) The right to be assured wherever possible, access to a variety of goods and services at competitive prices;

(e) The right to be informed about the quality, potency, purity, standard and price of goods (or services as the case may be) so as to protect the consumers against unfair trade practices; and

(f) The right to be protected against the marketing of goods (and services) which are hazardous to life and property.

Redressal Agencies:

We explain below the various authorities set up under the Consumer Protection Act 1986.

Consumer Protection Councils:

The Act provides for setting up a Central Consumer Protection Council by the Central Government and State Consumer Councils by each state of India. The Central Consumer Protection Council shall consist of (1) the Minister in Charge of Consumer Affairs in the Central Government who shall be its chairman and such number of other official or non-official members representing such interests as prescribed.

It is required by the Act that Central Consumer Protection Council will meet as and when necessary. However, at least one meeting of the Central Council must be held every year. The objects of the council are to protect the rights of consumers and promote their interest as listed above from (a) to (f).

The State Consumer Councils to protect consumer rights as per amendment in the Act in 1993 will consist of (1) the Minister in Charge of Consumer Affairs in the State Government concerned and members of other officials and non-officials representing such interests as may be prescribed by the State Governments. As in the case of the Central Council, the objects of State Councils will be to protect the rights of consumers as listed above from (a) to (f) within the State.

Consumer Disputes Redressal System :

Under the Consumer Protection Act 1986 three-tier consumer disputes redressal system at the District, State and National levels has been set up.

Thus the Act provides for establishing the following consumer redressal agencies:

1. District Consumer Forum in each district of a state set up by the State Government.

2. State Consumer Commission in each state set up by each State.

3. National Consumer Commission set up by the Central Government.

Composition of Consumer Redressal Agencies:

According to Consumer Protection Act 1986 each District Consumer Forum set up in each district of a State shall consist of a person who is or has been or is qualified to be a district judge. This person will work as president of the district consumer forum.

Two eminent members who have adequate knowledge and experience and have the ability in dealing with problems concerning law, commerce, economics, accountancy, industry, public affairs or administration and one of whom shall be a lady member, especially who is a social worker.

A District Forum has the jurisdiction to deal with the complaints where the value of good or service and the compensation claimed, if any, does not exceed Rs. 20 lakh (as per amendment in the Act in 2002). A complaint by consumers will be filed in a District Forum in case when the opposite party or each of the opposite party if there are more than one resides or carries on business within the district concerned at the time of filing the complaint or any one of the party (if there are more than one) residing or carrying on business in the district at the time of the filing of the complaint if the district forum grants permission for this.

The State Consumer Commission shall consist of:

(1) A person who is or has been a judge of a high court appointed by the State Government,

(2) Two other members of high standing and eminence who have adequate knowledge or experience concerning the problems relating to law, commerce, economics, industry, public administration etc. one of whom shall be a woman.

The State Consumer Commission as per the amendment of the Act in 2002 shall have the jurisdiction to entertain complaints where the value of goods or services and compensation claimed if any exceeds Rs. 20 lakh but is not more than Rs. 1 crore.

The State Consumer Commission will also entertain appeals against the orders of District Forums within the State. Besides, the State Consumer Commissions have been authorized to call for the records and give appropriate orders in case of any consumer dispute pending before the District Forum within the State or has been decided by it if the State Commission finds that a District Forum has exercised a power not vested in it by the Act or has failed to exercise a power or jurisdiction vested in it or acted illegally in exercise of its powers.

The National Consumer Commission will consist of:

(a) A person who is or has been a judge of the Supreme Court and is appointed by the Central Government in consultation with Chief Justice of India. He will also work as president of the national commission,

(b) Four other members of eminence having good knowledge or experience and ability to deal with the problems relating to commerce, economics, law, industry, public affairs or administration and one of whom shall be a woman.

National Consumer Commission has the jurisdiction:

(1) To entertain complaints where the value of goods or services and compensation claimed if any is, according to Amendment Act 2002, one crore or more;

(2) National Commission is authorized to hear appeals against the order of any State Consumer Commission;

(3) The Central Commission has the right to call for the records from the State Commissions.

It is important to note that all forums, commissions appointed under the Consumer Protection Act are in substantial matters not different from the ordinary civil courts. They are quasi-judicial tribunals created to render speedy justice

Remedial Action :

It may be noted that a complaint to a redressal agency may be filed by:

(a) An individual, consumer;

(b) Recognized consumer association,

(c) More than one consumers who have the same interest; and

(d) The State or Central Government. The complaint to a redressal agency must be in relation to goods sold or delivered or service provided to the complainant.

If the redressal agency is convinced that any of the allegations in the complaint filed before it is true, it shall issue an appropriate order to the opposite party.

This order may be any of the following types:

1. To remove the defect if found to be true by the appropriate laboratory from the good in question;

2. To replace the defective goods with the new goods of the same type free from the defects;

3. To return to the complainant price of the defective good or charges paid by him;

4. To pay the compensation to the complainant as may be decided by the redressal agency for the loss suffered by him;

5. To remove the defects or deficiencies in the service rendered to the individuals;

6. To stop the unfair or restrictive trade practice or give undertaking not to repeat in future;

7. Not to supply hazardous goods;

8. To withdraw the hazardous goods being offered for sale; and

9. To give adequate costs to the parties in question.

The Consumer Commissions are authorized to impose penalties on trader or person against whom complaint is made if he fails to comply with the order of the redressal agency. The penalty or punishment may involve imprisonment for a period not more than 3 years or a fine of not more than 10 thousand rupees or both.

The Consumer Protection Amendment Act 2002:

The Consumer Protection Act 1986 held great hopes for the helpless consumers who have been denied fair deal by the unscrupulous producers or traders. In the implementation of Consumer Protection Act 1986 some deficiencies in the Act were noticed. Therefore, some important amendments were made in the Act by Consumer Amendment Act 2002. With this amendment all the redressal agencies (District Forums, State Consumer Commissions and Central Consumer Commission) have been given the powers of a judicial magistrate of a first class for trial of offences within their jurisdiction, subject of course to the right of appeal from a lower redressal agency to a higher one.

The important changes made by the Consumer Protection Amendment Act 2002 are the following:

1. Both MRTP Act and Consumer Protection Act deal with unfair and restrictive trade practices. Amendment made in Consumer Protection Act in 2002 has clarified that the expression ‘restrictive trade practices’ will also include delay in supply of goods or services and rise in prices in the mean time.

2. Provisions regarding unfair trade practices have been made more stringent. It is now provided that if the representations contained in an advertisement for the sale or supply of a good or service are misleading, the advertiser can be held responsible for taking corrective steps at his own cost apart from other obligations.

3. The District Forums would be able to deal with cases involving the payment of compensation of Rs. 20 lakhs against the pre-existing Rs. 5 lakhs. Similarly, the State Consumer Commissions can now deal with cases involving compensation up to Rs. 1 crore while National Consumer Commission can deal with cases involving compensation of Rs. 1 crore or more instead of pre-existing Rs. 25 lakhs.

4. In the event of the death of the complainant, amendment in the Act in 2002 now provides for substitution of his legal representatives. Surviving legal representatives can file a complaint or get substitution in place of the existing one.

5. In regard to goods hazardous to life or safety of the public, traders supplying goods will be liable if it can be proved that the supplier could have known with due care that the goods or services supplied were hazardous to the public. Besides, liability of suppliers of spurious products and services is made clear in the Amendment Act 2002.

6. An important amendment relates to the meaning of expression ‘manufacturing’. Manufacturing has now been defined to include merely assembling parts of goods made by others or putting one s own mark on any good manufactured by others.

7. Amendment Act 2002 makes the restrictive trade practices more stringent by including under it trade practice which tends to the manipulation of price or the conditions of delivery of goods or affect the flow of supplies of goods in the market in a manner that imposes undue costs or restrictions on the consumers. Restrictive trade practice also includes delay in the delivery of goods beyond the period agreed to by the traders or delay in providing services when such delay is likely to lead to rise in their prices.

8. According to an important provision in the 2002 Amendment Act, in trading or commerce of goods or services misleading or deceptive conduct of traders or suppliers would be treated as unfair trade practice. Those who make misleading or false representation luring consumers to buy goods or services would fall within unfair trade practice and would be held liable. Under the Consumer Protection Amendment Act 2002 the consumers who are lured to enter into such a contract would be entitled to get the damages.

Similarly, Amendment Act 2002 also covers the unfair treatment to the consumers who have suffered by being lured in the schemes offering gifts, concessional prices or some items free of charge depending on the official results of a particular scheme. This amendment provides remedy to the consumers who might be unfairly treated in such schemes by requiring the promoter to disclose proper information regarding the results of a scheme by appropriate timely publication of results in newspapers, etc.

Proposed Amendments in Consumer Act, 2010 :

The Cabinet has given clearance to the proposed amendments to the Consumer Protection Act which is likely to be passed by the parliament in winter session of 2010. These amendments seek to make the consumer protection law more responsive to consumer complaints through quicker disposal of cases. The proposed amendments have widened the scope of the law, specified time limit for quicker disposal of cases and rationalized qualifications for appointment of members of consumer forums at the state and national level.

Evaluation of Consumer Protection Act :

Consumer Protection Act with amendments made in it in 2002 is a quite comprehensive piece of legislation that seeks to protect the consumers against unfair and exploitative practices of manufacturers. Consumer awareness in India is now fast growing. As a result, the number of complaints by the end of 2002 before District Forums had been about 14 lakhs, that before State Commissions 2 lakhs and that before National Commission about 21,000 all of which amount to the total of about 162,100.

It is important to note that Consumer Protection Act is additional law protecting consumers but not a derogation of any other laws which protect consumers. Services or goods provided by those dealing in information technology, electronic commerce (E-Commerce) are also liable under the Consumer Protection Act apart from the Act governing Telecommunication Regulatory Authority of India (TRAI) which regulates not only transactions between competing providers of telecommunication services but also regulate them to protect consumer interests.

Similarly, the Consumer Protection Act is in addition to MRTP Act which also tries to protect the interests of consumers by controlling monopolistic and restrictive trade practices. According to G.L. Sanghi, “The tribunals created under the Consumer Protection Act are in substantial matters not different from the ordinary civil courts. They are quasi-judicial tribunals created to render inexpensive and speedy justice. They provide additional remedies through the newly created forums”.

A Comprehensive Act:

The Consumer Protection Act is quite a comprehensive legislation. Under the Consumer Protection Act not only manufacturers and suppliers of goods but also of such services as insurance providers, medical treatment, lending and recovery of bank loans also come within the purview of the Act. A few such important cases are worth explaining.

Consumer Protection Act and Medical Practitioners:

The applicability of Consumer Protection Act to medical practitioners is a highly complicated issue and the case relating to it went even up to the Supreme Court of India. In defence of medical practitioners it was argued that their services are excluded category being services under “Control of Personal Services”. Supreme Court rejected these arguments and brought medical practitioners, hospitals and nursing homes where services are rendered for valuable consideration under the purview of Consumer Protection Act.

Doctors and hospitals committing medical negligence have therefore become liable and damages for medical negligence can be claimed from them. Though this has created fear and concern among medical practitioners and private hospitals but this will help in preventing medical negligence on the part of doctors and hospitals.

It has been widely reported in the media about medical negligence, for example, of operating a wrong eye, removing a kidney of a person without his consent, leaving screw, scissors and a towel in the abdomen of a patient, giving a wrong injection leading to the death of a patient. For all these acts of negligence compensation can be claimed from doctors and hospitals and also penalties can be imposed on them.

In an important case Supreme Court held that a medical practitioner may be liable if there was a negligence in respect of diagnosis and/or treatment given to a patient provided it can be demonstrated that the negligent act was not based on reasonable and responsible information as to the kind and quality of treatment.

Insurance Companies and Consumer Protection Act:

One of the important categories where Consumer Protection Act has been usefully applied is the claims against insurance companies. Many insurance companies (including public sector insurance companies) often deny medi-claims to the insurers on one pretext or the other.

Generally insurance companies deny claims for damages to the insurers that they did not disclose the pre-existing disease they were suffering from at the time of getting insured. In many cases consumer commissions have rejected the arguments of insurance companies and have awarded damages to the insurers and require insurance companies to fulfill their contractual obligations.

In a recent case of accident claim the United India Insurance Company denied to pay the damages on a car which met with an accident on the ground that it was being plied without the ‘fitness certificate’ as required under the Motor Vehicles Act. In this case in Nov. 2007, National Consumer

Commission held that the insurance companies, if the terms of the policy were not breached, cannot refuse to entertain claims on the pretext that the insured violated some other laws or conditions “as the insurance is a matter of contract between the two parties.”

Recovery of Bank Loans and Consumer Protection Act:

The wide applicability of Consumer Protection Act can be understood from the recent judgment of the State Consumer Commission of Delhi which slapped a fine of Rs. 55 lakhs on ICICI Bank for trying to recover a vehicle loan by hiring musclemen. The goons of recovery agent of the bank forcibly dragged out a youth from the car, beat him up with iron rods and left him bleeding and drove away with the vehicle. Justice J.D. Kapoor, president of the commission, said, “We hold ICICI Bank guilty of the grossest kind of deficiency in service and unfair trade practice for breach of terms of contract of hire-purchase/loan agreement by seizing the vehicle illegally.”

Conclusion:

In view of the above usefulness and wide applicability of Consumer Protection Act, Mr. G.L. Sanghi is right in concluding, “In each and every area involving sale of goods and services for valuable consideration a consumer stands protected. The polarity of this law is unlimited. Its machinery is effective and awesome to the delinquent trader with solace to the consumer. As experience grows further improvements will un-doubtetedly make this remedy more and more useful”.

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Home Essay Examples Law Consumer Protection

Consumer Protection In India

• Category Law
• Subcategory Laws & Regulations
• Topic Consumer Protection

1. Introduction

They have to keep growing, adapting and refining all the time. Consumer protection concerns are shared globally and are not specific to any country or sector.

The literal meaning of “COSUMER” is a person who buys goods and services for his own personal use and not for manufacture or resale. it also covers transactions through all modes offline and online. For the protection of consumer rights and to provide an adequate remedy to customers Consumer protection act was passed by Parliament in 24th Dec. 1986.

Our writers can write you a new plagiarism-free essay on any topic

2. Aims and Objectives

• Sustain the balance between the purchaser and seller.
• Maintain and boost the consumer’s interest.
• Protection of consumer rights.
• Prevent consumer exploitation from deceitful traders.
• Signify consumer interest before the Government & make effective protection law.
• Consolidate consumer resistance against unfair trade practices.
• Collaborate with Government for making policies for consumer protection.
• Build a programmes for consumer education and awareness.
• Ensure consumer-oriented practices.
• Redress the aggrieved consumer through Government and NGO’s.

3. Consumer Protection Needed

Consumer protection in India is needed due to some important factors :

• High prices of goods and services
• Monopoly of companies
• Less supply of Products
• Improper weight or quality of the products
• Legal complexities
• Lack of awareness

Misleading advertisements

• Adulteration in goods/products

4. Existing Consumer Protection Frameworks in India

1. legal framework in india [3], 1.1. consumer protection act,1986.

• Passed in 24 Dec. 1986
• Recognition of 6 rights of consumers
• Include 6 types of Unfair trade practices like false representation
• Formation of Consumer protection council (CPCs)

Who can file a complaint –

• Any voluntary consumer organisation
• The Central Government
• The State Govt. or Union Territory Administration

What constitute complain –

• If consumer suffered loss
• If consumer purchased the defected goods
• If deficiency in service occurred in hired services
• If the amount is charged is greater than the MRP

Procedure of filing complain –

• File within 2 years of cause of action
• Submit the 3 copies of complaint and attach the supporting documents in it
• There is no need to hire a Lawyer, Complainant can appear In-person at court

Pecuniary Jurisdiction of courts –

• District : Up to Rs 20 lakh.
• State : Between Rs 20 lakh and up to Rs one crore.
• National : Above Rs one crore.

Judicial structure of court –

• District: Headed by current or former District Judge and two members.
• State : Headed by a current or former High Court Judge and at least two members.
• National: Headed by a current or former Supreme Court Judge and at least four members.

Penalty & Imprisonment

• Failure to comply with an order of the district, state or national Commissions will attract imprisonment of up to three years or fine of up to Rs 10,000 or both.

Appeal Against –

• District Forum – within 30 days – in State Commission
• State Commission – within 30 days – National Commission
• National Commission – within 30 days – Supreme Court

1.2. Consumer Protection Bill, 2015 [4]

Passed in 10 Aug. 2015

Adds three types of Unfair trade practices to the list, namely:

• failure to issue a bill or receipt;
• refusal to accept a good returned within 30days; and
• disclosure of personal information given in confidence.

Product liability –

• The responsibility of the manufacturer if a defect in a good has caused physical damage, injury or death.
• Claimant is required to prove that manufacturer knew or should have known that harm would be caused.
• Product seller is liable for negligence in specified conditions.

Unfair Contracts-

• · Lists six contract terms which may be held as unfair.
• Establishes the Central Consumer Protection Authority (CCPA) to enforce consumer rights.
• CCPA can pass orders regarding recall of products, unfair contracts, and misleading advertisements.
• CCPA can declare unfair contract terms as null and void.
• CCPA can impose penalties for violation of consumer rights and misleading advertisement.

Pecuniary Jurisdiction of courts-

• District: Up to Rs 50 lakh.
• State: Between Rs 50 lakh and up to Rs 10 crore.
• National: Above Rs 10 crore.

Penalties & Imprisonments

• In case of Commissions, fine increased to a maximum of Rs 50,000.
• Failure to follow CCPA order – imprisonment of up to six months or fine of up to Rs 20 lakh, or both.
• Penalty for publishing a false advertisement of food – fine of up to Rs 10 lakh.
• Penalty for manufacture, sale etc.of adulterated food -fine of up to Rs one lakh.

Misleading Advertisements

• The CCPA can order withdrawal or discontinuation or modification of false and misleading advertisements.
• CCPA/District Commission will direct issuance of corrective advertisements.

E- Commerce

• Defines Electronic intermediary.

1.3. The Consumer Protection Bill, 2018 [5]

• Passed in 20 Dec. 2018
• Unfair Trade Practices
• Retains the three types of practices added in the 2015 Bill.
• Amends 30 days to time period specified in cash memo or 30 days if no time period mentioned.
• For disclosure of personal information, removes reference to public interest exception.
• Removes those contests/ lotteries from the ambit of unfair trade practice that may be prescribed

Product Liability

• Product liability for service providers included.

Removes following conditions of liability for manufacturer

• defendant is the manufacturer; and
• dangerous aspect of product was proximate cause of harm with regard to the product manufacturer.

Removes the condition regarding manufacturer’s knowledge. Reference to negligence not included in the Bill

Unfair Contracts

• Changes definition to include terms which can cause significant change in consumer rights.
• Complaints against unfair contracts can be filed with only the State and National Commission.

Advisory body

• Makes CPCs advisory bodies at the district, state and national level
• Investigation wing set up under CCPA.

Pecuniary Jurisdiction of courts –

• District : Up to Rs one crore.
• State : Between Rs one crore and up to Rs 10 crore.

Judicial Structure –

• District : Headed by a President and at least two members.
• State : Headed by a President and at least four members.
• National: Headed by a President and at least four members
• In case of Commissions, fine increased to a maximum of Rs one lakh.
• Failure to follow CCPA order – same as 2015 Bill.
• Graded penalties for adulterated products and spurious goods.
• The CCPA can issue direction to discontinue false advertisements, or modify it.
• For false and misleading advertisements, a penalty of up to Rs 10 lakh may be imposed on manufacturer or an endorser.
• For a subsequent offence, the fine may extend to Rs 50 lakh. The manufacturer can also be punished with imprisonment of up to two years, which may extend to five years in case of every subsequent offence.
• The CCPA can also prohibit the endorser of a misleading advertisement from endorsing any particular product or service for a period of up to one year.
• For every subsequent offence the period of prohibition may extend to three years. There are certain exceptions when an endorser will not be held liable.
• Penalties also specified for adulterated products and spurious goods.
• Direct selling, e-commerce and electronic service provider defined.
• The central government may prescribe rules for preventing unfair trade practices in e-commerce and direct selling.

1.4. Composition of Redressal Agencies [6]

National commission.

• President (a person who is or has been Jude of the Supreme Court to be appointed by the Central Govt.)
• Four Members

State Commission

• President (a person who is or has been or is High Court appointed by the state govt.)
• Two Members

District Forum

• President (a person who is or has been a judge of a qualified to be a District Judge )

2. Rights of the consumers [7]

The consumer has innumerable rights under the consumer protection Act and some new rights added recently in The Consumer Protection Bill, 2018. So here they are :-

I. Right to Safety

Consumers have right to be protected by the goods which are dangerous to health and life. As a consumer, if we are cognizant or aware of this right. we can take precautions to prevent the harm.

II. Right to Complain

If the harm is caused after using the product in spite of precautions then you have a right to complain against the dealer.

III. Right to be Informed

Consumers have right to be informed about the quality, quantity, purity, standard, grade and price of the goods available to them.

IV. Right to Choose

Every consumer has right to choose the product of their own choice. But sometimes the advertisements on TVs influence the consumers to buy the product. These irregularities can be avoided in effective manner if consumer is aware of this right.

V. Right to be Heard

Consumers have right to be heard by manufacturers, dealers and advertisers about their views and grievances. Also consumers have right to be heard before the court in legal proceedings while dealing with his/her consumer rights. Consumers also have right to be consulted by the government and public authorities when rules or policies are made affecting the Consumer Interests.

VI. Right to seek Redressal

The Consumer has right to get Redress – to seek adequate legal relief from the appropriate court of law. This right also provide consumer to get Compensation from the dealer or supplier or manufacturer of the goods if consumer has suffered any loss or damage.

VII. Right to consumer Education

Consumer Education empowers consumers to exercise their consumer rights. To restrict the malpractices and exploitation of consumers .The consumer alertness and education is essential.

2. Self-Guideline/Rules [8]

Manufacturer service providers and industries have their own existing laws in various sectors in the form of code of conduct or general guiding principles.

Most Bank have adopted a code of Bank’s Commitment to Customers formulated by the Banking Codes and Standards Board of India. Similarly, industry associations like National Association of Software & Service Companies (NASSOCOM) and Confederation of Indian Industry (CII) grinding towards welfare of consumers. How the service providers handle the complaint of the customers is also a very vital part of consumer protection. As a worthy practice, some organizations have Customer Complaints systems which are ISO 100002 compliant.

3. Consumer Groups[9]

No consumer protection framework is complete without the participation of consumers’ groups in consumer education campaigns, giving recommendation to policy makers and promoting the interests of consumers in general. Many Consumer Organizations are running in India and actively involved in complaints handling, education, advocacy, creating awareness amongst consumers. For example, some prominent VCOs in India are Consumer Education and Research Centre (CERC), Consumer Unity of Trust Society (CUTS),Voluntary Organization in the Interest of Consumer Education (VOICE) these are one of the leading NGO’s for providing the consumer a right path and help them to attain the relief.

5. Current Challenges in Consumer Protection in India

5.1. lack of information.

Consumers are not properly informed or they may not have the full (or any) details about these three pieces of information.

This lack of information put consumers in an unfavorable position, and got exploited by the sellers. This is more prevalent in certain industries such as financial services, telecom, and e-commerce. These are the fastest growing sectors in India, where an increasing number of consumers are entering the market. Problems in newer Markets can arise due to the following:

• Difficulty to understanding the services offered
• Multifarious terms of the contract
• Inventive terms in contract

5.2. Effectiveness of Exisinting Law

The current laws on consumer protection are not implemented by the effectiveness Due to growing economy and growing the customers reach to producers/sellers there cannot be one ideal law but the effectiveness of the current legal framework is the ultimate necessity.

5.3. Redress Mechanism

Redressal Mechanisms provide to consumers who have had bad experiences in the market. Consumer Protection Act, 1986 provides for a quasi-judicial system consisting of the Consumer Forum, State Commissions and National Commission.

Some specific challenges relating to redress mechanisms are:

• Bulky legal process
• The onus is on the consumer to take action
• Lack of understanding about legal workings
• Lack of Alternate Dispute Redressal Mechanisms

5.4. Data Protection & Privacy[11]

Data Protection & Privacy have gained importance with growth in the information technology sector. Limit-less online transactions and

trades have brought in new challenges in the field of data protection. Consumers Bank account details and personal information are now at huge risk because this information can be easily stolen.

The issue of data protection has various aspects that require consideration. These include:

• Privacy of Account Details of Consumers
• Personal data Protection
• Data of consumers sold as commodity by companies
• International Drift of Data

5.5. Unfair Trade Practices

Unfair Trade Practices are fraudulent, deceptive or dishonest trade practices or business representation of the product/service, which is prohibited by law or actionable under law by a judgment of the court.

5.6. Misleading Advertisement

Individuals do not have the power or resources to take upon large business houses against any unfair trade practices or misleading ads. Misleading ads like Patanjali or Nestlé product ads.

5.7. Quality standards

Quality standards ensure the minimum quality compliance by producers. India follows the Bureau of Indian Standards (BIS) or international standards by bodies such as ISO, WHO, FAO, etc. Certification of Indian quality standards is done by BIS. The international standards certification is done by third parties. All international standards that are being followed in India are voluntary in nature. Standards developed by BIS fall under two categories: Mandatory and voluntary. Standards relating to necessary products and commodities fall under the mandatory category, for example as in case of electronic products.

Some issues relating to Quality standards in India are

• Standards in India are voluntary in nature
• A lack of strict standards rules
• Many existing Indian Standards doesn’t verified by the international standards
• The Third parties certifying doesn’t have to be authentic.
• Standardisation is not widespread in India

5.8. Vulnerable Consumer Groups

• Due to Digital divide i.e. inequality due to access to information & communication technology and e-skills, elderly and children are more exposed to risks from their digital activity.
• People lacking access to internet, ICT or skills to use these resources might suffer with regards to various opportunities and developments. (EU, 2014).[13] [13: Europe Economics. (2007). An analysis of the issue of consumer detriment and the most appropriate methodologies to estimate it. London: DG SANCO. Retrieved from http://ec.europa.eu/consumers/startegy/docs/study_consumer_detriment.pdf]
• Children are especially vulnerable to abusive advertisements aimed at them and undesirable internet access. Children’s growing participation in social networking websites has raised privacy concerns as having a profile on a social network has become an essential part of their online lives (OECD, 2009).[footnoteRef:14] [14: www.oecd.org/india/children privacy issues]

6. Duties of the Consumer

• a) The Responsibility to be aware
• b) The Responsibility to gather
• c) The Responsibility to Think Independently
• d) The Responsibility to Speak out
• e) The Responsibility to Complain
• f) The Responsibility to be an Ethical Consumer
• g) The Responsibility to Respect the Environment

7. Current data of complaints

8. cases of consumer rights, 1. patanjali product sample failure [17] [17: https://m.hindustantimes.com/india-news/baba-ramdev-s-patanjali-products-fail-uttarakhand-quality-test/story ].

An RTI query revealed that Patanjali’s Divya Amla juice and Shivlingi Beej failed to meet the quality standards. The lab report said 31.68% of foreign matter was found in the products and also had less PH value as prescribed. Out of 82 samples, collected betwwen 2013 to 2016, 32 failed the quality test.

2. Maggi Dispute(M/S Nestle India Limited vs The Food Safety And Standfards Authority of India [18]) [18: http://www.icmrindia.org/casestudies/catalouge/Law/The%20Maggi%20Ban-Case%20Study.htm]

The Nestle India Pvt. (Ltd.) (subsidiary company of Nestle international, Switzerland) product Maggie found containing MSG while the labelling of the product says ‘NO MSG’. After a laboratory test the product found containing the MSG FSSAI ban the product for 5 months. Bombay High court remove the ban but when the matter appear before Supreme Court the court held that the producer is liable if a consumer suffers any harm after consuming their product. The SC imposed a penalty and order to destroy the Maggie product containing MSG which is dangerous to health if eaten.

3. Club Mahindra Case [19] [19: https://indiankanoon.org/doc/27374524]

The Pune District Consumer Dispute Redressal Forum has directed Chennai Based Mahindra Holidays and Resorts India Ltd. Also known as Club Mahindra to Pay Rs. 2.08 lakh with 9% annual interest rate to a complainant who was not able to avail of its services even after becoming a member.

9. Key Measures for Protection of Consumer Rights

• Awareness of consumer rights through campaigns like Jago GRAHAK Jago
• Always insist on Cash Memo
• Never pay more than the mentioned MRP in the product
• Look after for Standard marks like ISI, FPO, etc.
• Check the product Expiry and manufacturing date while purchasing
• Be an educated, aware, and strong consumer
• If found anything suspicious in the product or deficiency in services then make a Call to National Toll-Free Consumer Helpline No. 1800-11-4000 [20] [20: www.nationalconsumerhelpline.in ]
• Battle for your Rights

10. Way Forward

Due to changing nature of products and technological advancements in the business environment, new risks to consumer welfare have emerged. These insist to update the current law of consumer protection. The Consumer Protection (Amendment) Bill, 2018 bridges some of the gaps, a lot still needs to be done. The Consumer Protection Law should possess the following features: clarity, accountability, Impartial appointment.

Further, the interests of vulnerable groups should be given special attention and safeguards.

Cross boundary trade and online transactions have resulted in a global customer base of many companies. Thus, issues related to consumer protection have grown in their importance. In order to ensure that the interests of Indian consumers are protected in the rapidly changing economy, effective measures have to be taken by policymakers. It is time we carry forward our laws and their execution in line with the progressions in business. Such timely action would make sure consumers trust and confidence in the market and also protected by those laws. Legislation alone can’t solve all the problems unless and until consumer is not aware of their rights. We should be concerned with promoting consumer education and awareness, settling consumer complaints, conducting consumer research and working in liaison with other organizations to find solutions to consumer problems. There is vast scope for building up a massive and dynamic consumer awareness movement in India.

“Your Product, Your Rights”

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Consumer Rights and Protection

Last updated on March 5, 2024 by ClearIAS Team

Consumer rights and protection in India are safeguarded through various laws and regulations aimed at ensuring fair trade practices, preventing unfair business activities, and protecting the rights and interests of consumers. Read here to learn more.

Consumer rights and protection refer to the rights and measures in place to ensure the well-being, safety, and fair treatment of consumers in the marketplace.

These rights are designed to safeguard consumers from unfair business practices, provide them with accurate information, and empower them to make informed choices.

The need for consumer rights and protection arises from various factors, and these measures contribute to a balanced and ethical marketplace.

Table of Contents

Consumer Rights

• Right to Safety: Consumers have the right to be protected against goods and services that may be hazardous to their health or safety.
• Right to Information: Consumers have the right to receive accurate and complete information about products and services, enabling them to make informed choices.
• Right to Choose: Consumers have the right to choose from a variety of goods and services at competitive prices.
• Right to be Heard: Consumers have the right to be heard and to have their grievances addressed by businesses and regulatory authorities.
• Right to Seek redressal: This means the right to seek redressal against unfair trade practices or unscrupulous exploitation of consumers. It also includes the right to fair settlement of the genuine grievances of the consumer.
• Right to Consumer Education: This means the right to acquire the knowledge and skill to be an informed consumer throughout life. Ignorance of consumers, particularly of rural consumers, is mainly responsible for their exploitation. They should know their rights and must exercise them. Only then real consumer protection can be achieved with success.

Consumer responsibilities

• Be Critically Aware: The responsibility to be more alert and to question more – about prices, about quantity and quality of goods bought and services used.
• Be Involved: The responsibility to be assertive – to ensure that you get a fair deal as a consumer. Remember, if you are passive, you are likely to be exploited.
• Be Organized: The responsibility to join hands and raise voices as consumers; to fight in a collective and to develop the strength and influence to promote and protect consumer interest.
• Practice Sustainable Consumption: The responsibility to be aware of the impact of your consumption on other citizens, especially the disadvantaged or powerless groups; and to consume based on needs – not wants.
• Be Responsible to the Environment: The responsibility to be aware and to understand the environmental consequences of our consumption. We should recognize our individual and social responsibility to conserve natural resources and protect the earth for future generations.

Need for Consumer Rights and Protection

• Information Asymmetry: Consumers often lack the same level of information as sellers. This asymmetry can lead to exploitation, and consumer rights ensure access to accurate and transparent information.
• Unfair Trade Practices: Some businesses engage in unfair practices, such as false advertising or misrepresentation. Consumer protection laws are necessary to prevent such practices and hold businesses accountable.
• Product Safety : The safety of products is crucial for consumer well-being. Consumer rights ensure that products meet safety standards, and consumers have the right to seek compensation for harm caused by defective products.
• Redressal Mechanism: Disputes between consumers and businesses are inevitable. Consumer protection laws establish forums and mechanisms for the resolution of these disputes, ensuring fair and efficient redressal.
• Market Competition: Consumer rights contribute to a competitive marketplace by encouraging fair business practices. When consumers are empowered to make choices based on accurate information, businesses are incentivized to improve their products and services.
• Vulnerable Consumers: Certain groups of consumers, such as the elderly, disabled, or economically disadvantaged, may be more vulnerable to exploitation. Consumer protection laws aim to safeguard the interests of these vulnerable groups.
• Globalization and E-commerce: With the rise of globalization and e-commerce, consumers are exposed to a wide range of products and services. Consumer rights become crucial in ensuring the safety and fairness of transactions conducted online and across borders.
• Ethical Business Practices: Consumer rights promote ethical business practices, emphasizing fairness, transparency, and honesty in dealings with consumers.

Legislative framework for consumer rights and protection in India

India celebrates National Consumer Rights Day on 24 th  December every year to raise awareness about consumer rights and responsibilities. The day commemorates the day when the Consumer Protection Act 1986 received the President’s assent on December 24, 1986.

Consumer Protection Act, 2019:

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• The Consumer Protection Act, of 2019 replaced the earlier Consumer Protection Act, of 1986, and it came into effect on July 20, 2020.
• The new act introduces several provisions to enhance consumer rights and strengthen the mechanism for consumer protection.
• It establishes the Central Consumer Protection Authority (CCPA) to promote, protect, and enforce consumer rights.

Consumer Forums:

• Consumer forums, also known as Consumer Disputes Redressal Commissions, are established at the district, state, and national levels to adjudicate consumer disputes.
• Consumers can file complaints at the appropriate forum based on the value of the claim.

Consumer Protection (E-Commerce) Rules, 2020

• The new act addresses issues related to e-commerce and provides for the liability of e-commerce entities.
• It regulates direct selling, prevents unfair trade practices, and ensures transparency in e-commerce transactions.

Global standards

United Nations Guidelines for Consumer Protection:

• The United Nations Guidelines for Consumer Protection (UNGCP) are “ a valuable set of principles for setting out the main characteristics of effective consumer protection legislation, enforcement institutions and redress systems and for assisting interested Member States in formulating and enforcing domestic and regional laws, rules and regulations that are suitable to their own economic and social and environmental circumstances, as well as promoting international enforcement cooperation among Member States and encouraging the sharing of experiences in consumer protection. “

International Organization for Standardization (ISO):

• ISO develops and publishes international standards, including those related to consumer protection.
• ISO 9001, for example, addresses quality management systems and includes considerations for customer satisfaction and meeting customer needs.

Organization for Economic Co-operation and Development (OECD):

• The OECD has guidelines and recommendations on consumer protection that member countries are encouraged to adopt.
• The OECD Principles on Consumer Protection in E-commerce guide ensuring fair business practices in online transactions.

United Nations Conference on Trade and Development (UNCTAD):

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• UNCTAD works on issues related to trade, development, and consumer protection.
• UNCTAD’s Consumer Protection Toolkit offers practical guidance for countries seeking to enhance their consumer protection policies.

World Trade Organization (WTO):

• While the WTO primarily focuses on trade-related issues, it recognizes the importance of consumer protection in international trade.
• The WTO agreements acknowledge the need to balance trade interests with consumer protection and public health.

International Consumer Protection and Enforcement Network (ICPEN):

• ICPEN is a network of consumer protection authorities from various countries.
• It facilitates cooperation and information exchange among consumer protection agencies globally.

In essence, consumer rights and protection are essential for creating a fair, transparent, and responsible marketplace where consumers can confidently make choices, and businesses operate ethically. These measures contribute to a healthier economic ecosystem by fostering trust between consumers and businesses.

Consumer rights and protection in India are evolving to address contemporary challenges, especially in the context of e-commerce and digital transactions. The emphasis on product liability and the establishment of the CCPA under the new Consumer Protection Act, of 2019, reflects a commitment to strengthening consumer rights and redressal mechanisms. Consumer awareness and education continue to play a crucial role in empowering consumers to make informed choices and exercise their rights effectively.

Global standards for consumer protection are dynamic and responsive to emerging challenges, including those posed by technological advancements and changes in consumer behavior. Cooperation among nations, international organizations, and consumer advocacy groups is vital to maintaining and enhancing these standards in an interconnected and rapidly evolving global marketplace.

Read: D igital monopolies by big techs

-Article by Swathi Satish

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• Intro and Importance of Consumer Protection

Gone are the days of “Caveat Emptor” now it is “Consumer is King”. There are no dearth of sellers who wish to fulfil all of the consumer’s demands, and cannot afford to alienate consumers with bad service or products. Consumers have tools at their disposal such as consumer complaints, courts, forums etc. Let us take a look at consumer protection in India.

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Introduction to consumer protection.

A consumer is the one who assumes to be treated like a King as they bring business to the seller. Previously “consumer was asked to beware” but these days fingers have been pointed to seller “let seller be beware” as due to policies introduced, government laws, consumer protection, NGO and the increased competition in the market.

Consumer Protection is a term given to a practice wherein we need to protect the consumer from the unfair practice, educating them about their rights and responsibilities and also redressing their grievances.

Browse more Topics under Consumer Protection

• Consumer Protection Act
• Consumer Rights/Responsibilities
• Legal Protection to Consumers
• Consumer Organisations and NGOs

Why do Consumers need to be Protected?

There are n number of products in the market which are injurious to the health of the consumer, adulteration, false weights, monopoly and unfair trade practice are some of the issues that need to be tackled and are to be addressed to protect the consumer against it.

How do we Protect the Consumer?

• The consumer should be educated on their rights and responsibilities
• Their grievances should be redressed
• The judicial body requires to provide them with the justice.

Importance of Consumer Protection

I. importance from consumer point of view  .

• Consumer Ignorance : Consumer when seeing it from their point of view then we have gathered some aspects to it. Of which, Consumer Ignorance needs to be taken care of they should know how to exercise their rights and how to seek reliefs.
• Unorganised Consumer : We need a Consumer Organisation which can unify the consumers and help them seek relief with their consumer issues.
• Widespread Exploitation of Consumer : Consumer is been exploited through the ways of adulteration, false practice, fake weights, incomplete information on packaged products, Misleading Advertisements . For instance, there are many products that claim to make you fair or reduce your weight but when you use the products it does not provide what is promised.

II. Importance from Business Point of View

Do business really need to consider consumer protection, is there a way which can benefit them as well? Let us have a look at some of the points which provide us with some insight :

• Long-Term Interest of Business : If one wants to increase their customer base in long-term then they need to make a satisfied customer. A satisfied customer with their word of mouth would make more customer and increase the consumer base.
• Business uses society’s Resources : Business should not hamper consumer confidence as most of the resources taken from the society. In turn, business keeps in mind public interest and provide products accordingly.
• Social Responsibility : Business have responsibilities towards the consumer, government bodies and society and they should work in a way which should be beneficial to them and the business as in return it will flourish their business.
• Moral Justice : Business has a moral duty to the society and consumer and they should take steps which should not hamper the society or consumer. They should prevent any sort of exploitation like adulteration, unfair practices, defective product, fair price and weight.
• Government Intervention : To avoid the situation of government intervention in the business which could be a hectic task. For that business should design their trade practice in such a way which would be in the interest of the consumer.

Consumer Complaints

Consumer Complaints are the first step of redressal that the customer takes in the process of consumer protection. Hence this is the most important step that the businesses need to handle with extreme care and dexterity. And in the times of the internet consumer complaints and feedback has more power than ever

Consumer complaints can actually help an organization improve their products and services. It is a great form of feedback. It gives you a very fair measure of customer satisfaction. And if consumer complaints are dealt with swiftly it actually helps with customer retention and even improves the goodwill of your company.

So instead of treating consumer complaints as a hindrance or a headache, organizations can treat it as a way to bring about improvement and grow their consumer base.

Solved Question for You

Question: What are the ways and means of Consumer Protection?

Ans: The various ways and means of Consumer Protection are:

• Self Regulation
• Consumer Organisations
• Consumer Awareness
• Business Associations

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Consumer Protection

• Consumer Awareness, Consumer Rights and Responsibilities

2 responses to “Consumer Organisations and NGOs”

from -mukesh m chandiramani,7a-30,navjivan society,lamington road,mumbai-400008 i had booked the appoinment for covid-19 test for mr mukesh mohan chandiramani(age 48) and rekha mohan chandiramani(age 73) with KlinicApp Network Lab – Krsnaa Diagnostics dated 30-07-2020.but the government of maharashtra did not allow KlinicApp Network Lab – Krsnaa Diagnostics to enter navjivan society,lamington road,mumbai-400008.the government of maharashtra blocked my testing by KlinicApp Network Lab – Krsnaa Diagnostics,inspite of repeated calls to 022-23835004 bmc d ward office i was not allowed to be tested for covid-19.i have sent emails to hon chief mininster of maharashtra and hon prime minister of india dated 30-07-2020 and 31-07-2020 but till date i have not got any reply. i would like the government of india to pay me compensation of 5 lacs for blocking my covid -19 test dated 30-07-2020

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Comparative Analysis of Consumer Protection Act 1986 and 2019

This post has been written by Shaily Jain, a second year law student from Amity Law School, Amity University, Chhattisgarh.

Consumer Protection Act, 1986:

The development of a nation is often measured by multiple parameters; and economic well-being invariably becomes a crucial parameters. This involves transactions and other dealings and at one end of such trades, are the consumers whose rights ought to be protected. Hence, it was important for a country like India to have legislations that dealt with promotion of interests of consumers and thus came about the legislation of Consumer Protection Act, 1986 .

With the rapid expansion in trade and commerce, the traders had an unfair upper hand over the consumers and this was a direct consequence of industrialisation. Consumers had little or no knowledge about the rights available to them and hence were pushed to a disadvantage.

 But, it was only in 1986 that the law-makers of the nation decided to structure and streamline the efforts made towards protecting consumers’ interests and stressed for the need of a welfare legislation in the form of the Consumer Protection Act, 1986.

The introduction of the COPRA in 1986 was to protect the interests of the consumers and to safeguard their rights as well. It provided a multi-dimensional approach to promote consumer interests which included spreading of awareness and establishment of consumer councils.  This provided a platform for the consumers to settle consumer disputes. It also envisioned this to be a medium that would facilitate a faster and efficient way for redressal.

The aim and objective along with the purpose for which the act was established, is explained under Section 6, 8 and 8B of the Consumer Protection Act, 1986. Section 6 goes on to detail the rights which the act aims to protect and lists them as:

• Right to safety of life and property from hazardous goods.
• Right to information about the quality, quantity, potency, purity, standard and price of goods and services so as to protect consumers against unfair trade practices.
• Right to choice as to variety of goods and services.
• Right to be heard and representation and to be assured that consumer interests will receive due consideration at appropriated platform.
• Right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers.
• Right to consumer education

Consumer Protection Act 2019 Comes Into Force: Key Things To Kn ow

The Consumer Protection Act, 2019 comes into force on July 20 ( Monday), replacing the more than 3-decade old Consumer Protection Act 1986. The new law aims to enforce and protect the rights of consumers, and provide an effective mechanism to address consumer grievances.

The Consumer Protection Bill, 2019 was introduced in the Upper House of Parliament by the Minister of Consumer Affairs, Food and Public Distribution, Ram Vilas Paswan, on July 8, 2019. It was passed by the Lok Sabha on July 30, 2019 and Rajya Sabha on August 6, 2019. The Bill was then signed into law by President Ram Nath Kovind on August 9 last year.

The Consumer Protection Act 2019 will be more holistic and stringent after rules are framed to protect the interest of the consumers, Union Minister for Consumer Affairs, Food and Public distribution, Ram Vilas Paswan said at a press conference today. A meeting of former Secretaries of the Consumer Affairs Department and Members of Parliament will be held this month to finalise the rules, the minister added.

The Act proposes the establishment of a Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers, and make interventions in situations of unfair trade practices.

The Act provides for a simplified dispute resolution mechanism, with a provision for mediation and e-filing of cases. The consumers can file complaints at a district or state consumer commission closest to their residence, rather than the location where the service or products were sold. Consumers can drag manufacturers and sellers of adulterated and spurious products to court and claim compensation, as is applicable.

Under the aegis of the new Consumer Protection Act, 2019, a product manufacturer and seller will be liable to provide compensation for injury or damage caused by a defective product or service. The errant businesses will be penalized with up to 6 months in jail or a fine of up to Rs 1 lakh if the consumers do not suffer any injuries. In cases where the consumer is injured, the fine to the manufacturer, seller or distributor could go up to Rs 5 lakh and up to seven years in jail. In case of death of the consumer, the culprit will have to pay a minimum fine of Rs 10 lakh and spend seven years in jail, which can be extended to life imprisonment.

Differences between Consumer Protection Act, 1986 and Consumer Protection Act, 2019

As is evident, CPA 2019 has made several changes to the erstwhile CPA 1986. CPA 2019 has widened the reach of consumer protection regime in India. The changes made vide CPA 2019 seem to further empower consumers by leveraging responsibilities not only on their counterparts, i.e., the sellers, manufacturers, service providers, but also the endorsers of such products. It also attempts to address the issues that were not comprehensively touched upon by CPA 1986, such interests of consumers as a class, etc.

CPA 2019 has also attempted to ease and fasten the process of consumer disputes resolution by increasing the pecuniary jurisdiction of the commissions, attaching mediation cells, increasing the members of the commissions, imposing higher penalties etc.

The ramifications of CPA 2019 cannot be precisely gauged beforehand, as many new concepts have been introduced. However, what can definitely be said is that everyone involved in a transaction, other than the consumer, will have to be more careful, and cautious than ever before.

• https://zeenews.india.com/economy/new-consumer-protection-act-2019-comes-into-force-today-know-how-it-will-benefit-you-2297012.html
• https://www.thehindu.com/news/national/tamil-nadu/new-consumer-protection-act-gives-more-power-to-consumers-experts-say/article32135908.ece  
• Also read https://lawlex.org/lex-pedia/the-new-consumer-protection-act-2019/24942

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Consumer Protection Act, 2019

Consumer protection act, 2019 - a brief overview.

The Consumer Protection Act, 2019 is an important topic for the UPSC exam. This is a part of the polity and governance segments in the UPSC syllabus. In this article, we give you a brief description of the details of the newly-passed Act, salient provisions of the Act, its importance and associated concerns, for the IAS exam .

Consumer Protection Act, 2019:- Download PDF Here

The new Consumer Protection Act was passed by Parliament in 2019. It came into force in July 2020 and replaced the Consumer Protection Act, 1986.

Read about the important acts in India from the linked article.

Given below is a gist of the Consumer Protection Act, 2019:

Need for the new act:

• The Digital Age has ushered in a new era of commerce and digital branding, as well as a new set of customer expectations. Digitisation has provided easy access, a large variety of choices, convenient payment mechanisms, improved services and shopping as per convenience. However, there are also associated challenges related to consumer protection.
• To help address the new set of challenges faced by consumers in the digital age, the Indian Parliament passed the landmark Consumer Protection Bill, 2019 which aims to provide timely and effective administration and settlement of consumer disputes.

Consumer Protection Act 2019 Details:

• Consumer Protection Act, 2019 is a law to protect the interests of the consumers. This Act provides safety to consumers regarding defective products, dissatisfactory services, and unfair trade practices.
• The basic aim of the Consumer Protection Act, 2019 is to save the rights of the consumers by establishing authorities for timely and effective administration and settlement of consumers’ disputes.

Rights of the consumers:

• Consumers have the right to information on various aspects of goods and services. This could be information about the quantity, quality, purity, potency, price, and standard of goods or services.
• To be protected from hazardous goods and services. Right to protection against goods and services that can be dangerous to life and property.
• To be protected from unfair or restrictive trade practices.
• Consumers have the right to access a variety of goods and services at competitive prices.
• Consumers should have the right to redressal.

Also, read about the  National Consumer Disputes Redressal Commission (NCDRC) in the linked article.

Refer to the links below for IAS exam preparation:

Salient Provisions of the Consumer Protection Act 2019

New definition of consumer :

• The new Act has widened the definition of ‘consumer’.

Definition of consumer:

• As per the Act, a person is called a consumer who avails the services and buys any good for self-use. Worth to mention that if a person buys any good or avails any service for resale or commercial purposes, he/she is not considered a consumer. This definition covers all types of transactions i.e. offline and online through teleshopping, direct selling or multi-level marketing.

Central Consumer Protection Authority :

• The Act proposes the establishment of the Central Consumer Protection Authority (CCPA) as a regulatory authority.
• The CCPA will protect, promote and enforce the rights of consumers and regulate cases related to unfair trade practices, misleading advertisements, and violation of consumer rights.
• The CCPA will have the right to take suo-moto actions, recall products, order reimbursement of the price of goods/services, cancel licenses, impose penalties and file class-action suits.
• The CCPA will have an investigation wing to conduct independent inquiry or investigation into consumer law violations.

To get the List of important Acts that Transformed India for the upcoming UPSC exam preparation, candidates can visit the linked article.

Consumer Disputes Redressal Commission: 

• The Act has the provision of the establishment of Consumer Disputes Redressal Commissions (CDRCs) at the national, state and district levels to entertain consumer complaints.
• As per the notified rules, the State Commissions will furnish information to the Central Government on a quarterly basis on vacancies, disposal, the pendency of cases and other matters.
• Overcharging or deceptive charging
• Unfair or restrictive trade practices
• Sale of hazardous goods and services which may be hazardous to life.
• Sale of defective goods or services
• As per the Consumer Disputes Redressal Commission Rules, there will be no fee for filing cases up to Rs. 5 lakh.

E-Filing of Complaints:

• The new Act provides flexibility to the consumer to file complaints with the jurisdictional consumer forum located at the place of residence or work of the consumer. This is unlike the earlier condition where the consumer had to file a complaint at the place of purchase or where the seller has its registered office address.
• The new Act also contains enabling provisions for consumers to file complaints electronically and for hearing and/or examining parties through video-conferencing.
• Consumers will also not need to hire a lawyer to represent their cases.

Product Liability & Penal Consequences :

• A manufacturer or product service provider or product seller will now be responsible for compensating for injury or damage caused by defective products or deficiency in services.
• This provision brings within its scope, the product manufacturer, product service provider and product seller, for any claim for compensation. The term ‘product seller’ would also include e-commerce platforms.

Penalties for Misleading Advertisement:

• The CCPA may impose a penalty on a manufacturer or an endorser, for a false or misleading advertisement. The CCPA may also sentence them to imprisonment.

Provision for Alternate Dispute Resolution :

• The new Act provides for mediation as an Alternate Dispute Resolution mechanism. For mediation, there will be a strict timeline fixed in the rules.
• As per the recently notified rules, a complaint will be referred by a Consumer Commission for mediation, wherever scope for early settlement exists and parties agree to it. The mediation will be held in the Mediation Cells to be established under the aegis of the Consumer Commissions. There will be no appeal against settlement through mediation.

Unfair Trade Practices:

• The new Act has armed the authorities to take action against unfair trade practices too.
• The Act introduces a broad definition of Unfair Trade Practices, which also includes the sharing of personal information given by the consumer in confidence unless such disclosure is made in accordance with the provisions of any other law.

The Central Consumer Protection Council:

• As per the notified Central Consumer Protection Council Rules, the Central Consumer Protection Council would be headed by the Union Minister of Consumer Affairs, Food and Public Distribution with the Minister of State as Vice Chairperson and 34 other members from different fields.
• The Council, which has a three-year tenure, will have a Minister-in-charge of consumer affairs from two States from each region – North, South, East, West, and NER. There is also a provision for having working groups from amongst the members for specific tasks.

Applicability:

• This Act is applicable to all the products and services, until or unless any product or service is especially debarred out of the scope of this Act by the Central Government.

Aspirants can read about different rights available to Indian citizens from the links given below:

Consumer Protection Act 2019 Significance:

Empowering consumers:

• Consumer-driven businesses such as retail, e-commerce would need to have robust policies dealing with consumer redressal in place.
• The new Act will also push consumer-driven businesses to take extra precautions against unfair trade practices and unethical business practices.

Inclusion of the e-commerce sector:

• E-commerce has been witnessing tremendous growth in recent times. The Indian e-commerce market is expected to grow to US$ 200 billion by 2026.
• As per the notified rules, every e-commerce entity is required to provide information relating to return, refund, exchange, warranty and guarantee, delivery and shipment, modes of payment, grievance redressal mechanism, payment methods, the security of payment methods, charge-back options, etc. including country of origin which are necessary for enabling the consumer to make an informed decision at the pre-purchase stage on its platform.
• The e-commerce platforms will have to acknowledge the receipt of any consumer complaint within forty-eight hours and redress the complaint within one month from the date of receipt under this Act. This will bring e-commerce companies under the ambit of a structured consumer redressal mechanism.
• E-commerce entities that do not comply will face penal action.

Time-bound redressal:

• A large number of pending consumer complaints in consumer courts have been common across the country. The new Act by simplifying the resolution process can help solve consumer grievances speedily.
• A main feature of the Act is that under this, the cases are decided in a limited time period.

Responsible endorsement:

• The new Act fixes liability on endorsers considering that there have been numerous instances in the recent past where consumers have fallen prey to unfair trade practices under the influence of celebrities acting as brand ambassadors.
• This will make all stakeholders – brands, agencies, celebrities, influencers and e-commerce players – a lot more responsible. The new Act would force the endorser to take the onus and exercise due diligence to verify the veracity of the claims made in the advertisement to refute liability claims.

Upholding consumer interests:

• For the first time, there will be an exclusive law dealing with Product Liability.
• Product liability provisions will deter manufacturers and service providers from delivering defective products or deficient services.
• The new legislation empowers the National Consumers Dispute Redressal Committee as well as the State Commission to declare null and void any terms of a contract while purchasing a product. This will go a long way in protecting consumers, who are often subject to contract conditions that favour a seller or manufacturer.

Alternate dispute redressal mechanism:

• The provision of Mediation will make the process of dispute adjudication simpler and quicker.
• This will provide a better mechanism to dispose of consumer complaints in a speedy manner and will help in the disposal of a large number of pending cases in consumer courts across the nation.

Simplified process for grievance redressal:

• The new Act would ease the overall process of consumer grievance redressal and dispute resolution process. This will help reduce inconvenience and harassment for the consumers.
• The enhanced pecuniary jurisdiction and provisions providing statutory recognition to mediation processes, enabling filing of complaints from any jurisdiction and for hearing parties through video-conferencing will increase accessibility to judicial forums and afford crucial protection in times when international e-commerce giants are expanding their base.

Read more about the  Consumer Confidence Index (CCI) at the linked article.

Consumer Protection Act 2019 Concerns:

State regulation:

• As part of the Consumer Protection Act, 2019, the Ministry of Consumer Affairs will compile a code of conduct for advertisers and agencies, a move designed to curb unfair practices and misleading claims. The planned code will detail penalties for advertisers and their agencies and publishers if misleading advertising and false claims are found.
• There have been concerns that this approach would mark a move from self-regulation to a more federated oversight.

Implementational challenges:

• The existing vacancies at the district commission level would undermine the effective implementation of the new Act.

Lack of differentiated approach:

• As per the proposed rules for the e-commerce businesses, companies are not allowed to “manipulate the price” of goods and services offered on their platforms to gain unreasonable profit or discriminate between consumers of the same class or make any arbitrary classification of consumers affecting their rights under the Act.
• The clause on the manipulation of price by e-commerce companies appears irrelevant as sometimes, the e-commerce companies would want to reduce the price to enhance sales volume. For a country with market size of around $25 billion, the guidelines should have taken a deeper view of the e-commerce ecosystem, covering all prevailing business models between consumers, marketplaces and sellers.

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Frequently Asked Questions related to the Consumer Protection Act 2019

What is the consumer protection act in india, what are the main features of the consumer protection act, what is the aim of the consumer protection act.

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