LEARNING OBJECTIVES

After studying this chapter, youshould be able to:

state the importance ofconsumer protection;

briefly explain legal frameworkfor consumer protection inIndia;

describe consumer rights inIndia;

list out consumer responsibilities;

briefly describe the ways andmeans of consumer protection;and

describe the role of consumerorganisations and NGOs inprotecting consumers’ interests.

CHAPTER

12CONSUMER PROTECTION

MAHARASHTRA CONSUMER COMMISSION

SLAPS FINE OF RS ONE LAKH ON

COCA COLA

The Maharashtra State ConsumerCommission has asked Coca Cola, oneof the international fizzy drinksmanufacturer, its bottler anddistributor to pay Rs one lakh indamages to a consumer who foundimpurities in a bottle of soft drink thathe had bought.

Chandrashekhar Paradkar, aresident of Shankar Nagar area here,filed a complaint with the Nagpurdistrict Consumer Grievances Fourmseeking compensation of Rupees fourlakh after he found some solid objectsinside a sealed bottle of a soft drink.He had bought six various brands ofthe soft drink— two bottles each ofMazaa, Coca Cola and Sprite from ashop near his house.

Based on that, the District Forumearlier gave a ruling after finding CocaCola, its bottlers Superior Drinks Pvt.Ltd. and distributors Balaji Sales guiltyof supplying drinks unfit for humanconsumption, which was upheld by theState Consumer Commission.

The District Forum had foundobjects resembling pieces of mosquitorepellent mats floating inside the sealedbottle. Having conducted the tests by aPublic Health Laboratory, they foundthe drink unfit for human consumption.

The District Forum came downheavily on the company saying

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in unscrupulous, exploitative andunfair trade practices like defectiveand unsafe products, adulteration,false and misleading advertising,hoarding, black-marketing etc. Thismeans that a consumer might beexposed to risks due to unsafeproducts, might suffer from bad healthdue to adulterated food products,might be cheated because ofmisleading advertisements or sale ofspurious products, might have to paya higher price when sellers engage inoverpricing, hoarding or black-marketing etc. Thus, there is a needfor providing adequate protection toconsumers against such practices ofthe sellers. Let us now discuss theimportance of consumer protection.

IMPORTANCE OF CONSUMER

PROTECTION

Consumer Protection has a wideagenda. It not only includes educatingconsumers about their rights andresponsibilities, but also helps ingetting their grievances redressed. Itnot only requires a judicial machineryfor protecting the interests ofconsumers but also requires theconsumers to get together and form

The above case is just one of theexamples of the many problems thatconsumers might have to face in thepurchase, use and consumption ofgoods and services. The case alsohighlights the need for an appropriatelegal protection to be provided toconsumers to protect them fromvarious forms of exploitation from theseller. Have you ever thought whatwould be the plight of consumers ifadequate protection is not provided tothem? Can the present day businessesafford to ignore the interests ofconsumers? The area of consumerprotection has emerged as a veryimportant area of study havingsignificance for both the consumersand businesses alike.

INTRODUCTION

A consumer is said to be a king in afree market economy. The earlierapproach of caveat emptor, whichmeans “Let the buyer beware”, hasnow been changed to caveat venditor(“Let the seller beware”). However, withgrowing competition and in an attemptto increase their sales and marketshare, manufacturers and service-providers may be tempted to engage

multinational giants would not be allowed to have a free run and exploit a poor countrylike India by manufacturing and marketing sub-standard products.

While giving its ruling, the District Forum relied upon the historic Donald versusStevenson case, wherein heavy compensation had been awarded to a consumer,who had found rusted nails inside a bottle of ginger beer.

Source: http://www.indlaw.com/guest/news

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themselves into consumer associationsfor protection and promotion of theirinterests. At the same time, consumerprotection has a special significance forbusinesses too.

From Consumers’ point of view

The importance of consumerprotection from the consumers’ pointof view can be understood from thefollowing points:

(i) Consumer Ignorance: In the lightof widespread ignorance ofconsumers about their rights andreliefs available to them, it becomes

necessary to educate them about thesame so as to achieve consumerawareness.(ii) Unorganised Consumers: Con-sumers need to be organised in theform of consumer organisations whichwould take care of their interests.Though, in India, we do have consumerorganisations which are working in thisdirection, adequate protection isrequired to be given to consumers tillthese organisations become powerfulenough to protect and promote theinterests of consumers.(iii) Widespread Exploitation ofConsumers: Consumers might be

Compensation for impurities in cold drinks

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exploited by unscrupulous, exploitativeand unfair trade practices like defectiveand unsafe products, adulteration,false and misleading advertising,hoarding, black-marketing etc.Consumers need protection againstsuch malpractices of the sellers.

From the point of view ofBusiness

A business must also lay emphasis onprotecting the consumers and adequatelysatisfying them. This is importantbecause of the following reasons:

(i) Long-term Interest of Business:Enlightened businesses realise that itis in their long-term interest to satisfytheir customers. Satisfied customersnot only lead to repeat sales but alsoprovide good feedback to prospectivecustomers and thus, help inincreasing the customer-base ofbusiness. Thus, business firms shouldaim at long-term profit maximisationthrough customer satisfaction.

(ii) Business uses Society’sResources: Business organisations useresources which belong to the society.They, thus, have a responsibility tosupply such products and render suchservices which are in public interestand would not impair public confidencein them.

(iii) Social Responsibility: A businesshas social responsibilities towardsvarious interest groups. Businessorganisations make money by sellinggoods and providing services toconsumers. Thus, consumers form animportant group among the many

stakeholders of business and likeother stakeholders, their interest hasto be well taken care of.

(iv) Moral Justification: It is the moralduty of any business to take care ofconsumer’s interest and avoid any formof their exploitation. Thus, a businessmust avoid unscrupulous, exploitativeand unfair trade practices like defectiveand unsafe products, adulteration,false and misleading advertising,hoarding, black marketing etc.

(v) Government Intervention: Abusiness engaging in any form ofexploitative trade practices wouldinvite government intervention oract ion . Th is can impair andtarnish the image of the company.Thus, it is advisable that businessorganisations voluntarily resort tosuch practices where the customers’needs and interests will well be takencare of.

In view of the above, the governmentof India has enacted several regulationsdesigned to provide adequate protectionto consumers. We shall now discusssome of these regulations.

LEGAL PROTECTION TO CONSUMERS

The Indian legal framework consists ofa number of regulations which provideprotection to consumers. Some of theseregulations are as under.

1. The Consumer Protection Act,1986: The Consumer Protection Act,1986 seeks to protect and promote theinterests of consumers. The Actprovides safeguards to consumers

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against defective goods, deficientservices, unfair trade practices, andother forms of their exploitation. TheAct provides for the setting up of athree-tier machinery, consisting ofDistrict Forums, State Commissionsand the National Commission. It alsoprovides for the formation of consumerprotection councils in every Districtand State, and at the apex level.

2. The Contract Act, 1982: The Actlays down the conditions in which thepromises made by parties to a contractwill be binding on each other. The Actalso specifies the remedies availableto parties in case of breach of contract.

3. The Sale of Goods Act, 1930: TheAct provides some safeguards andreliefs to the buyers of the goods incase the goods purchased do notcomply with express or impliedconditions or warranties.

4. The Essential Commodities Act,1955: The Act aims at controllingproduction, supply and distribution ofessential commodities, checkinginflationary trend in their prices andensuring equal distribution ofessential commodities. The Act alsoprovides for action against anti-socialactivities of profiteers, hoarders andblack-marketers.

Protection against malpractices and exploitation

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5. The Agricultural Produce(Grading and Marking) Act, 1937:The Act prescribes grade standards foragricultural commodities and live-stock products. The Act stipulates theconditions which govern the use ofstandards and lays down theprocedure for grading, marking andpacking of agricultural produce. Thequality mark provided under the Actis known as AGMARK, an acronym forAgricultural Marketing.

6. The Prevention of FoodAdulteration Act, 1954: The Act aimsto check adulteration of food articlesand ensure their purity so as tomaintain public health.

7. The Standards of Weights andMeasures Act, 1976: The provisionsof this Act are applicable in case ofthose goods which are sold ordistributed by weight, measure ornumber. It provides protection toconsumers against the malpractice ofunder-weight or under-measure.

8. The Trade Marks Act, 1999: ThisAct has repealed and replaced the Tradeand Merchandise Marks Act, 1958. TheAct prevents the use of fraudulentmarks on products and thus, providesprotection to the consumers againstsuch products.

9. The Competition Act, 2002: ThisAct has repealed and replaced theMonopolies and Restrictive TradePractices Act, 1969. The Act providesprotection to the consumers in caseof practices adopted by business firmswhich hamper competition in themarket.

10. The Bureau of Indian StandardsAct, 1986: The Bureau of IndianStandards has been set up under theAct. The Bureau has two majoractivities: formulation of qualitystandards for goods and theircertification through the BIS certificationscheme. Manufacturers are permittedto use the ISI mark on their productsonly after ensuring that the goodsconform to the prescribed qualitystandards. The Bureau has also setupa grievance cell where consumers canmake a complaint about the qualityof products carrying the ISI mark.

The most important of theseregulations is the ConsumerProtection Act which provides for sixconsumer rights and helps consumersin getting their grievances redressedfor any shortcoming in the goodspurchased or services availed.

THE CONSUMER PROTECTION ACT,1986

The Consumer Protection Act (CPA)seeks to protect and promote theconsumers’ interest through speedyand inexpensive redressal of theirgrievances.

The scope of the Act is very wide.It is applicable to all types ofundertakings, big and small, whetherin the private or public sector, or inthe co-operative sector, whether amanufacturer or a trader, and whethersupplying goods or providing services.

The Act confers certain rights toconsumers with a view to empoweringthem and to protect their interests.

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CONSUMER RIGHTS

The Consumer Protection Act providesfor six rights of consumers. Theconsumer protection councils set upunder the Act are intended to promoteand protect the various rights ofconsumers. These rights include thefollowing:

1. Right to Safety: The consumer hasa right to be protected against goodsand services which are hazardous tolife and health. For instance, electricalappliances which are manufacturedwith substandard products or do notconform to the safety norms mightcause serious injury. Thus, consumersare educated that they should useelectrical appliances which are ISImarked as this would be an assuranceof such products meeting qualityspecifications.

2. Right to be Informed: Theconsumer has a right to have completeinformation about the product heintends to buy including itsingredients, date of manufacture,price, quantity, directions for use, etc.It is because of this reason that thelegal framework in India requires themanufactures to provide suchinformation on the package and labelof the product.

3. Right to Choose: The consumerhas the freedom to choose from avariety of products at competitiveprices. This implies that the marketersshould offer a wide variety of productsin terms of quality, brand, prices, size,etc. and allow the consumer to makea choice from amongst these.

4. Right to be Heard: The consumerhas a right to file a complaint and tobe heard in case of dissatisfaction witha good or a service. It is because of thisreason that many enlightened businessfirms have set up their own consumerservice and grievance cells. Manyconsumer organisations are alsoworking towards this direction andhelping consumers in redressal of theirgrievances.

5. Right to seek Redressal: Theconsumer has a right to get relief incase the product or service falls shortof his expectations. The ConsumerProtection Act provides a number ofreliefs to the consumers includingreplacement of the product, removalof defect in the product, compensationpaid for any loss or injury suffered bythe consumer, etc.

6. Right to Consumer Education: Theconsumer has a right to acquireknowledge and to be a well informedconsumer throughout life. He shouldbe aware about his rights and thereliefs available to him in case of aproduct or service falling short of hisexpectations. Many consumerorganisations and some enlightenedbusinesses are taking an active part ineducating consumers in this respect.

The Consumer Protection Act byconferring these rights on theconsumers empowers them to fightagainst any unscrupulous, exploitativeand unfair trade practices adopted bysellers. The Box on East Delhi eateryshows how a restaurant owner wasfined for overpricing bottled water.

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Consumer rights, by themselves,cannot be effective in achieving theobjective of consumer protection.Consumer protection can, in effect, beachieved only when the consumers alsounderstand their responsibilities.

CONSUMER RESPONSIBILITIES

A consumer should keep in mind thefollowing responsibilities whilepurchasing, using and consuminggoods and services.

(i) Be aware about various goodsand services available in themarket so that an intelligent andwise choice can be made.

(ii) Buy only standardised goods asthey provide quality assurance.Thus, look for ISI mark onelectrical goods, FPO mark on foodproducts, Hallmark on jewelry etc.

(iii) Learn about the risks associatedwith products and services, followmanufacturer’s instructions anduse the products safely.

(iv) Read labels carefully so as to haveinformation about prices, netweight, manufacturing and expirydates, etc.

(v) Assert yourself to ensure that youget a fair deal.

(vi) Be honest in your dealings.Choose only from legal goods andservices and discourageunscrupulous practices likeblack-marketing, hoarding etc.

(vii) Ask for a cash memo on purchaseof goods or services. This wouldserve as a proof of the purchasemade.

(viii) File a complaint in an appropriateconsumer forum in case of a

Eatery fined for Overpricing Bottled Water

A restaurant owner in east Delhi has been directed to pay a fine of Rs. 5,000 to acustomer who was asked to shell out Rs. 34 for a water bottle which had a maximumretail price (MRP) of Rs.12. The fine comes at a time when consumer courts areturning the heat on shop-owners who overcharge. In a recent landmark decision, thestate consumer commission had slapped a fine of Rs. 50,000 on a cineplex for similarmalpractice. Goel was awarded the compensation by east district consumer forumpresident and members directing Zaika Bazaar, Karkardooma Complex, to compensateGoel for overcharging. The Forum said: “The present complaint is covered by thejudgment of the state consumer commision in case of Nirulas vs Ankit Jain in whichit said no trader or service provider can charge more price than an item’s MRP printedon the packed item, if delivered packed”. Ordering the restaurant owner to discontinuethe malpractice, the forum said charging higher amount than MRP, if delivered inpacked form, was against the law of the land. Goel had bought a bottle of Aquafinawater from the restaurant in November last year and was asked to pay Rs.34 for it,including a VAT of Rs. 4, when the bottle had a MRP of Rs.12 printed on it.

Source: www.corecentre.org

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shortcoming in the quality of goodspurchased or services availed. Donot fail to take an action even whenthe amount involved is small.

(ix) Form consumer societies whichwould play an active part ineducating consumers andsafeguarding their interests.

(x) Respect the environment. Avoidwaste, littering and contributingto pollution.

A consumers’ awareness about hisrights and responsibilities is just oneof the ways in which the objective ofconsumer protection can be achieved.There are other ways in which thisobjective may be achieved.

WAYS AND MEANS OF CONSUMER

PROTECTION

There are various ways in which theobjective of consumer protection canbe achieved.

1. Self Regulation by Business:Enlightened business firms realisethat it is in their long-term interest toserve the customers well. Sociallyresponsible firms follow ethicalstandards and practices in dealingwith their customers. Many firms haveset up their customer service andgrievance cells to redress the problemsand grievances of their consumers.

2. Business Associations: Theassociations of trade, commerce and

Marks indicating quality in different products

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business like Federation of IndianChambers of Commerce of India(FICCI) and Confederation of IndianIndustries (CII) have laid down theircode of conduct which lay down fortheir members the guidelines in theirdealings with the customers.

3. Consumer Awareness: A consumer,who is well informed about his rightsand the reliefs available to him, wouldbe in a position to raise his voiceagainst any unfair trade practices orunscrupulous exploitation. In additionto this, an understanding of hisresponsibilities would also enable aconsumer to safeguard his interests.

4. Consumer Organisations:Consumer organisations play animportant role in educating consumersabout their rights and providingprotection to them. These organisationscan force business firms to avoidmalpractices and exploitation ofconsumers.

5. Government: The government canprotect the interests of the consumersby enacting various legislations. Thelegal framework in India encompassesvarious legislations which provideprotection to consumers. The mostimportant of these regulations is theConsumer Protection Act, 1986. The

Consumer Awareness

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Act provides for a three-tier machineryat the district, state and national levelsfor redressal of consumer grievances.The redressal mechanism under thisthree-tier machinery has beenexplained hereunder.

REDRESSAL AGENCIES UNDER THE

CONSUMER PROTECTION ACT

For the redressal of consumergrievances, the Consumer ProtectionAct provides for setting up of a three-tier enforcement machinery at theDistrict, State, and the National levels,known as the District ConsumerDispute Redressal Forum, StateConsumer Disputes RedressalCommission, and the NationalConsumer Disputes RedressalCommission. They are briefly referredto as the ‘District Forum’, ‘StateCommission’, and the ‘NationalCommission’, respectively. While theNational Commission is set up by theCentral Government, the StateCommissions and the District Forums

are set up, in each State and District,respectively, by the State Governmentconcerned. The Figure on redressalagencies shows the hierarchicalstructure of this three-tire machinery.

Before studying the set-up andfunctioning of these redressal agencieslet see how the Consumer ProtectionAct defines a consumer and who canfile a complaint under the ConsumerProtection Act.

Consumer: A ‘consumer’ is generallyunderstood as a person who uses orconsumes goods or avails of any service.Under the Consumer Protection Act, aconsumer is defined as:

(a) Any person who buys any goods fora consideration, which has beenpaid or promised, or partly paid andpartly promised, or under anyscheme of deferred payment. Itincludes any user of such goods,when such use is made with theapproval of the buyer, but does notinclude a person who obtains goodsfor re-sale or any commercialpurpose.

National Commission

State Commission

District Forum

Redressal Agencies under the Consumer Protection Act

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(b) Any person who hires or avails ofany service, for a considerationwhich has been paid or promised, orpartly paid and partly promised, orunder any system of deferredpayment. It includes any beneficiaryof services when such services areavailed of with the approval of theperson concerned, but does notinclude a person who avails of suchservices for any commercial purpose.

Who can file a complaint?: Acomplaint before the appropriateconsumer forum can be made by:

(i) Any consumer;

(ii) Any registered consumers’association;

(iii) The Central Government or anyState Government;

(iv) One or more consumers, on behalfof numerous consumers havingthe same interest; and

(v) A legal heir or representative of adeceased consumer.

Let us now see how the consumergrievances are redressed by the three-tire machinery under the ConsumerProtection Act.

1. District Forum: The District Forumconsists of a President and two othermembers, one of whom should be awoman. They all are appointed by theState Government concerned. Acomplaint can to be made to theappropriate District Forum when thevalue of the goods or services inquestion, along with the compensationclaimed, does not exceed Rs. 20 lakhs.On receiving the complaint, the District

Forum shall refer the complaint to theparty against whom the complaint isfiled. If required, the goods or a samplethereof, shall be sent for testing in alaboratory. The District Forum shallpass an order after considering the testreport from the laboratory and hearingto the party against whom thecomplaint is filed. In case the aggrievedparty is not satisfied with the order ofthe District Forum, he can appealbefore the State Commission within 30days of the passing of the order.

2. State Commission: Each StateCommission consists of a Presidentand not less than two other members,one of whom should be a woman. Theyare appointed by the State Governmentconcerned. A complaint can to be madeto the appropriate State Commissionwhen the value of the goods or servicesin question, along with thecompensation claimed, exceeds Rs. 20lakhs but does not exceed Rs. 1 crore.The appeals against the orders of aDistrict Forum can also be filed beforethe State Commission. On receiving thecomplaint, the State Commission shallrefer the complaint to the party againstwhom the complaint is filed. If required,the goods or a sample thereof, shall besent for testing in a laboratory. TheState Commission shall pass an orderafter considering the test report fromthe laboratory and hearing to the partyagainst whom the complaint is filed.In case the aggrieved party is notsatisfied with the order of the StateCommission, he can appeal before theNational Commission within 30 daysof the passing of the order.

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3. National Commission: TheNational Commission consists of aPresident and at least four othermembers, one of whom should be awoman. They are appointed by theCentral Government. A complaint canto be made to the National Commissionwhen the value of the goods or servicesin question, along with thecompensation claimed, exceeds Rs. 1crore. The appeals against the ordersof a State Commission can also be filedbefore the National Commission. Onreceiving the complaint, the NationalCommission shall refer the complaintto the party against whom thecomplaint is filed. If required, the goodsor a sample thereof, shall be sent fortesting in a laboratory. The NationalCommission shall pass an order afterconsidering the test report from thelaboratory and hearing to the partyagainst whom the complaint is filed.

An order passed by the NationalCommission in a matter of its originaljurisdiction is appealable before theSupreme Court. This means that onlythose appeals where the value of goodsand services in question, along withthe compensation claimed, exceeded Rs.1 crore and where the aggrieved partywas not satisfied with the order of theNational Commission, can be taken tothe Supreme Court of India. Moreover,in a case decided by the District Forum,the appeal can be filed before the StateCommission and, thereafter, the orderof the State Commission can bechallenged before the NationalCommission and no further.

Relief Available

If the consumer court is satisfied aboutthe genuineness of the complaint, itcan issue one or more of the followingdirections to the opposite party.

(i) To remove the defect in goods ordeficiency in service.

(ii) To replace the defective productwith a new one, free from anydefect.

(iii) To refund the price paid for theproduct, or the charges paid forthe service.

(iv) To pay a reasonable amount ofcompensation for any loss orinjury suffered by the consumerdue to the negligence of theopposite party.

(v) To pay punitive damages inappropriate circumstances.

(vi) To discontinue the unfair/restrictive trade practice and notto repeat it in the future.

(vii) Not to offer hazardous goods forsale.

(viii) To withdraw the hazardous goodsfrom sale.

(ix) To cease manufacture ofhazardous goods and to desistfrom offering hazardous services.

(x) To pay any amount (not less than5% of the value of the defectivegoods or deficient servicesprovided), to be credited to theConsumer Welfare Fund or anyother organisation/person, to beutilised in the prescribed manner.

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(xi) To issue corrective advertisement toneutralise the effect of a misleadingadvertisement.

(xii) To pay adequate costs to theappropriate party.

Brings out some decided caseswhere a complaint was filed in aconsumer court for defective goodsand deficient services.

ROLE OF CONSUMER ORGANISATIONS

AND NGOS

In India, several consumerorganisations and non-governmentalorganisations (NGOs) have been setup for the protection and promotionof consumers’ interests. Non-governmental organisations are non-profit organisations which aim at

Some Decided Cases

Under the Consumer Protection Act, a consumer can file a complaint against themanufacturers or sellers for any defective good supplied to him or any deficientservices rendered to him.

In Jose Philip Mampillil vs. M/s Premier automobiles Ltd. & Anr, a diesel carpurchased by the appellant (consumer) was found defective. The defects in the carwere not removed by the defendants (manufacturer and dealer). The Commissionerappointed by the District Forum found a large number of defects in the car.Consequently, the District Forum directed repair of car free of cost and replacementof engine. The order was upheld by the State Commission except for the directionfor replacement of engine.

In the case of Sashikant Krishnaii Dole vs. Shikshan Prasarak Mandali, theNational Commission held that failure to amount basic safeguards in the swimmingpool amounts to deficiency in service. A school owned a swimming pool and offeredswimming facilities to the public on payment of a fee. The school conducted winterand summer training camps to train boys in swimming and for this purpose engageda coach. The plaintiffs enrolled their only son for learning swimming under theguidance of the coach. It was alleged that due to the negligence of the coach, theboy drowned and died. The school denied any responsibility on its part. The coachclaimed that he had considerable experience in coaching young boys is swimming.When the deceased was found to have been drowned, the coach immediately tookhim out of the water and removed the water from his stomach and gave him artificialrespiration and thereafter took him to a doctor. The doctor advised that the boy betaken to the nearest hospital where the boy died. The State Commission held theschool and the coach deficient in rendering service to the deceased. On appeal, theorder was upheld by the National Commission.

Adapted from: www.indiainfoline.com

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promoting the welfare of people. Theyhave a constitution of their own andare free from government interference.Consumer organisations and NGOsperform several functions for theprotection and promotion of interestof consumers. These include:

(i) Educating the general publicabout consumer rights byorganising training programmes,seminars and workshops.

CERS Wins Case against Railways

In a case filed by Consumer Education and Research Society (CERS), Ahmedabad,and a senior couple, the Consumer Dispute Redressal Forum, Ahmedabad City,has held the Railways responsible for negligence and directed it to pay Rs. 2000to the couple for its mental agony and Rs. 3000 towards cost.

Mr. Man Mohan Singh and his wife Kamlesh had bought a railway journey-cum-reservation ticket at Ahmedabad for travel from New Delhi to Kanpur Centralby the Shatabdi Express on 2 December 2001. The details on the ticket, includingthe coach number, the date of journey, etc., were illegible. Hence, they wereforced to buy another ticket for journey from New Delhi to Kanpur. They appliedfor a refund for the earlier ticket but, as the Forum noted, they had to suffermuch for the purpose. In spite of the couple’s giving the Ahmedabad residentialaddress for sending the refund, the Railways sent it to their Delhi address. Theyapproached CERS for help.

CERS filed a complaint against the Railways before the Consumer DisputeRedressal Forum, Ahmedabad City, under Sections 2(1)(g) and 2(1)(o) of theConsumer Protection Act, 1986. CERS claimed that the two senior citizens hadto face mental harassment due to the deficiency in service by the Railways. TheRailways contended, among other things, that the Forum had no territorialjurisdiction after cancellation of the ticket, the couple were no more consumersin the eye of the law, the complaint was time-barred and the Railway ClaimTribunal was the proper forum to entertain the complaint about refund.

The Forum, however, observed that the couple’s difficulties amounted to theRailways’ deficiency in service and ordered it to pay Rs. 2000 to the couple forthe mental agony suffered by them and Rs. 3000 as cost. The Forum did notdecide on the amount of refund, which it said, was “to be exclusively dealt withby the Railway Claim Tribunal”.

Source: www.corecentre.org

(ii) Publishing periodicals and otherpublications to impart knowledgeabout consumer problems, legalreporting, reliefs available andother matters of interest.

(iii) Carrying out comparative testingof consumer products in accreditedlaboratories to test relative qualitiesof competing brands andpublishing the test results for thebenefit of consumers.

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(iv) Encouraging consumers tostrongly protest and take anaction against unscrupulous,exploitative and unfair tradepractices of sellers.

(v) Providing legal assistance toconsumers by way of providingaid, legal advice etc. in seekinglegal remedy.

(vi) Filing complaints in appropriateconsumer courts on behalf of theconsumers.

(vii) Taking an initiative in filing casesin consumer courts in theinterest of the general public, notfor any individual.

Some of the important consumerorganisations and NGOs engaged inprotecting and promoting consumers’interests include the following.

(i) Consumer Coordination Council,Delhi

(ii) Common Cause, Delhi

(iii) Voluntary Organisation inInterest of Consumer Education(VOICE), Delhi

(iv) Consumer Education and ResearchCentre (CERC), Ahmedabad

(v) Consumer Protection Council(CPC), Ahmedabad

(vi) Consumer Guidance Society ofIndia (CGSI), Mumbai

(vii) Mumbai Grahak Panchayat,Mumbai

(viii) Karnataka Consumer ServiceSociety, Bangalore

(ix) Consumers’ Association, Kolkata

(x) Consumer Unity and TrustSociety (CUTS), Jaipur

KEY TERMS

Consumer Protection Consumer Right Consumer Responsibilities

Redressal Grades Standards

SUMMARY

Importance of Consumer Protection: From the point of consumers, consumerprotection is important because consumers are ignorant, unorganised andexploited by sellers. Consumer Protection is also important for a businessbecause (i) It is in the long-term interest of business, (ii) Business uses society’sresources, (iii) It is a social responsibility of business, (iv) It has moral justification,(v) It avoids government intervention in the functioning of business.

Legal Protection to Consumers: The Indian legal framework consists of anumber of regulations which provide protection to consumers. These include(i) The Consumer Protection Act, 1986, (ii) The Contract Act, 1982, (iii) TheSale of Goods Act, 1930, (iv) The Essential Commodities Act, 1955, (v) The

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Agricultural Produce (Grading and Marking) Act, 1937, (vi) The Preventionof Food Adulteration Act, 1954, (vii) The Standards of Weights and MeasuresAct, 1976, (viii) The Trade Marks Act, 1999, (ix) The Competition Act, 2002,(x) The Bureau of Indian Standards Act, 1986.

Consumer Rights: The Consumer Protection Act, 1986 provides for sixconsumer rights. These are (i) Right to safety, (ii) Right to be Informed,(iii) Right to choose, (iv) Right to be heard, (v) Right to seek redressal,(vi) Right to consumer education.

Consumer Responsibilities: In addition to exercising his rights, a consumershould also keep in mind his responsibilities while purchasing, using andconsuming goods and services.

Ways and Means of Consumer Protection: There are various ways in whichthe objective of consumer protection can be achieved. These Include (i) Selfregulation by business, (ii) Business associations, (iii) Consumer awareness,(iv) Consumer organisations, (v) Government.

Redressal Agencies under the Consumer Protection Act: The ConsumerProtection Act provides for setting up of a three-tier enforcement machineryat the District, State, and the National levels. They are referred to as the‘District Forum’, ‘State Commission’, and the ‘National Commission’. Thereare various reliefs available to a consumer under the Act. The appropriateconsumer court may pass an order for removal of defect in goods, replace adefective product, refund the price of the product etc.

Consumer Organisations and NGOs: In India, several consumer organisationsand non-governmental organisations (NGOs) are playing an active role inprotection and promotion of consumers’ interests.

EXERCISES

True or False

State whether the following statements are true or false.

(i) Consumer protection has a moral justification for business.

(ii) In addition to rights, a consumer also has some responsibilities.

(iii) A complaint can to be made to a District Forum when the value of thegoods or services in question, along with the compensation claimed,exceeds Rs. 20 lakhs.

(iv) The Consumer Protection Act provides for six consumer rights.

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(v) ISI is the quality certification mark used in case of food products.

(vi) Under the Consumer Protection Act, a complaint can be filed by aconsumer for a defective good and also for deficiency in service.

Short answer questions

(i) Explain the importance of consumer protection from the point of view ofa business.

(ii) Enumerate the various Acts passed by the Government of India whichhelp in protection of consumers’ interests.

(iii) What are the responsibilities of a consumer?

(iv) Who can file a complaint in a consumer court?

(v) What kind of cases can be filed in a State Commission?

(vi) Explain the role of consumer organisations and NGOs in protecting andpromoting consumers’ interests.

Long answer questions

(i) Explain the rights and responsibilities of a consumer.

(ii) What are various ways in which the objective of consumer protection canbe achieved? Explain the role of consumer organisations and NGOs inthis regard.

(iii) Explain the redressal mechanism available to consumers under theConsumer Protection Act, 1986.

Application based questions

(i) Visit a consumer organisation in your town. List down the variousfunctions performed by it.

(ii) Collect some newspaper cuttings of some consumer cases and the rulingsgiven therein.

Case Problem

Now, filing complaint is just a click away. Filing a complaint in a consumercourt’s going to get a lot easier by the end of this year, virtually. No matterwhich part of the country you’re in, it’s going to happen at the click of a mouse.

The project, called Confonet (Computerisation and Computer Networking ofConsumer Fora), is being executed on a turnkey basis by the NationalInformatics Centre (NIC).

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”Online registration of complaints, the government hopes, will promotee-governance, transparency, efficiency and streamlining of consumer fora,” saidan official in the consumer affairs ministry. Of Rs 48.64 crore set aside for theproject, the government has released Rs 30.56 crore so far, the official added.

”Besides software development and testing, networking and projectimplementation, integration and site preparation, it will include purchase ofhardware for all the 583 district fora, 35 state commissions and the NationalCommission,” the official said.

At present, computer systems and system software have been delivered to 25state commissions and 300 district fora — never mind the fact that it’ssometimes a long wait before the hardware is finally unpacked and set up insome of the districts. Meanwhile, training of staff, sometimes in the classroomand sometimes through e-learning sessions, are in full swing.

”But just setting up an online complaint filing system won’t ensure a strongconsumer protection movement in the country — for that we’re working onGenNext and the best way to do that is to go to schools,” the official said.

The government is, therefore, involving school children to form consumer clubsso as to involve them in various consumer welfare activities.

Part of the funding for running the club is to come from various stategovernments, with an equally matching grant from the Centre. However, anumber of state governments are yet to sanction the fund — some of theseinclude Uttar Pradesh, Madhya Pradesh and Kerala.

Source: www.economictimes.indiatimes.com

Question

1. What new measure is the ministry of consumer affairs taking to makefiling of complaint easy?

2. What role can you as a student play to contribute to the cause of consumerprotection?

3. What scenario of consumer protection do you foresee when the measuresproposed in the above news report are implemented?

(Teachers are advised to help students to study judgements of various consumerforums including National Consumer Disputes Redressal Commission atwww.ncdrc.nic.in. This initiative will help the pupils to understand the role ofconsumer protection in India better. Various published material can also beused. Consumer clubs in schools can also help the students in this regard.)