CONSUMER PROTECTION ACT, 1986

Consumer• A consumer is a user of goods and services

• Any person paying for goods and services has the right to demand quality services and products.

• Before the industrial era the producer/settler and the buyer/customer/consumer has close contact and understanding.

• Industrialization and mass productive systems involving machines has undermined close contact between seller and consumer was almost lost.

DefinitionsGoods means goods as defined in the Sale of goods Act, 1930.

Under the Act, goods means every kind of movable property other than actionable claims and money and includes stocks and shares, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale.

Service is defined to mean service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing,insurance, transport, processing, supply of electrical or other energy, board or lodging or both,housing construction, entertainment, amusement or the purveying of news or other information but does not include the rendering of any service free of charge or under a contract of personal service.

• In India, we have the Indian Contract Act, the sale of Goods Act, the Dangerous Drug Act, the Agricultural Produce (Grading & Marketing) Act, The Indian Standards of weight and Measure Act, The Trade and Merchandise Mark Act, etc. These Acts to some extent protect consumer interest.

• The drawback of the above said Acts is that it requires the consumers to initiate action by way of Civil suit which mostly lengthy legal process which are expensive and time consuming. There need a much more simpler and quicker access to redressed to consumer grievances.

Consumer Acts

Consumer and WTO Regime

With the coming of WTO, goods

from different countries in the

world began to pour the markets

of the Third World and the

consumers’ interest are not

adequately protected.

Consumer Protection Act

The preamble to the Act states that the Act is

legislated to provide for better protection of

the interests of consumers and for that

purpose to make provision for the

establishment of consumer councils and other

authorities for the settlement of consumer’s

disputes and for matters connected therewith.

UN GUIDELINES FOR THE CONSUMER PROTECTION

Protect from hazard to health & safety;

Promote & protect economic interests;

Provide adequate information for informed choice;

Consumer education;

Provide effective redress—formal and informal

procedures;

Freedom to form groups & present views in decision-

making affecting consumers;

THE CONSUMER PROTECTION ACT, 1986 (ACT)

• Applicability

• Amendments

– Amendments in the year 1993

– Amendments in the year 2002

WHO IS A CONSUMER?

• Two kinds of consumer under the Act

– Consumer of goods

• buys or agrees to buy goods

• any user of such goods

– Consumer of services

• hires or avails any services

• any beneficiary of such service

CONSUMERS NEED PROTECTION AGAINST

• Unfair trade practice

• Restrictive trade practice

• Defects

• Deficiencies

UNFAIR TRADE PRACTICE

Adopting unfair methods or deception to promote sale, use or

supply of goods or services e.g.

Misleading public about price (e.g. bargain price when it is not Misleading public about price (e.g. bargain price when it is not

so).so).

Charging above MRP printed.Charging above MRP printed.

Misleading public about another’s goods or services.Misleading public about another’s goods or services.

Falsely claiming a sponsorship, approval or affiliation.Falsely claiming a sponsorship, approval or affiliation.

Offering misleading warranty or guarantee.Offering misleading warranty or guarantee.

CONSUMERS NEED PROTECTION AGAINST

CONSUMERS NEED PROTECTION AGAINST

RESTRICTIVE TRADE PRACTICE Price fixing or output restraint re: delivery/flow of supplies to

impose unjustified costs/restrictions on consumers.

Collusive tendering; market fixing territorially among

competing suppliers, depriving consumers of free choice, fair

competition.

Supplying only to particular distributors or on condition of

sale only within a territory.

Delaying in supplying goods/services leading to rise in price.

Requiring a consumer to buy/hire any goods or services as

a pre-condition for buying/hiring other goods or services.

CONSUMERS NEED PROTECTION AGAINST

• DEFECTS– Any fault, imperfection or shortcoming in the quality, quantity, potency,

purity or standard which is required to be maintained by or under any law for the time being in force or under any contract express or implied or as is claimed by the trader in any manner whatsoever in relation to any goods.

• DEFICIENCY– Any fault, imperfection, shortcoming or inadequacy in the quality, nature

and manner of performance which is required to be maintained by or

under any law for the time being in force or has been undertaken to be

performed by a person in pursuance of a contract or otherwise in

relation to any service.

Basic Rights under Consumer Protection Act, 1986

1. The Right to be protected against marketing of goods and services which are hazardous to life and property

2. The right to be informed about the quality, quantity, potency, purity, standard and price of goods, or services so as to protect the consumer against unfair trade practices.

3. The right to be assured, wherever possible,access to variety of goods and services at competitive prices

4. The right to be heard and be assured that consumers’ interests will receive due consideration at appropriate forums

5. The right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers

6. The right to consumer education

FORUM & JURISDICTION

• Consumer Disputes Redressal Forums (District

Forum)– Claims less than or equal Rs.20 lacs.

• Consumer Disputes Redressal Commissions (State Commission) –Claim more than Rs.20 lacs & less than Rs.1 crore & appeals.

• National Consumer Disputes Redressal Commission

(National Commission) –Claim equal to Rs.1 crore & appeals

REQUISTIES OF A COMPLAINT

• Who can file a complaint

• Where to file a complaint

• How to file a complaint

• What constitutes a complaint?

• Procedure for filing the appeal

ESSENTIAL INFORMATION IN THE APPLICATION

– Name and full address of complainant

– Name and full address of opposite party

– Description of goods and services

– Quality and quantity

– Price

– Date & proof of purchase

– Nature of deception

– Type of redressal prayed for

BENEFITS & RELIEFS

• BenefitBenefit

– Disposal within 90 daysDisposal within 90 days

– No adjournment shall ordinarily be granted - No adjournment shall ordinarily be granted - Speedy trial

• Relief

– Removal of defects in goods or deficiency in services.

– Replacement of defective goods.

– Refund against defective goods or deficient services.

– Compensation.

– Prohibition on sale of hazardous goods.

Major Provisions of CONSUMER PROTECTION ACT 1986

Objective

An Act to provide for better protection of the interests of consumers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consum ers' disputes and for matters connected therewith.

Definitions.

"consumer" means any person who— • buys any goods for a consideration,• hires or avails of any services for a

consideration,• “uses such goods” with the approval of

person who has bought such goods for consideration.

• “is beneficiary of services” with the approval of person who has hired the services for consideration.

Continued…

"person" includes,—

• a firm whether registered or not;

• a Hindu undivided family;

• a co-operative society;

• every other association of persons whether registered under the Societies Registration Act, 1860 (21 of 1860) or not;

Continued…

"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, processing, supply of electrical or other energy…

Continued…

board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service;

Manufacturer is a person who-

• Makes or manufactures any goods or parts thereof.or

• Assembles parts of the goods made or manufactured by others and claims the end product to be goods manufactured by himself,or

Continued…

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• Puts his own mark on any goods made or manufactured by any other manufacturer and claims such goods to be goods made by him.

Continued…

Trader is a person who –

• Sells goods or,

• Distributes any goods for sale,

• Manufacturer of goods for sale,

• Packer of goods who sells or distributes goods in package form.

"complaint" means any allegation in writing made by a complainant that— 

• an unfair trade practice or a restrictive trade practice has been adopted by any trader or service provider;

• the goods bought by him or agreed to be bought by him; suffer from one or more defects;

Continued…

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• the services hired or availed of or agreed to be hired or availed of by him suffer from deficiency in any respect;

• a trader or service provider, as the case may be,  has charged for the goods or for the service mentioned in the complaint a price in excess of the price.

Continued…

• goods which will be hazardous to life and safety when used or being offered for sale to the public.

• services which are hazardous or likely to be hazardous to life and safety of the public when used.

Continued…

"consumer dispute" means a dispute where the person against whom a complaint has been made, denies or disputes the allega tions contained in the complaint.

CONSUMER PROTECTION COUNCILS

Central Consumer Protection Council.

The Central Council shall consist of the following members,

• the Minister in charge of the consumer affairs in the Central Government, who shall be its Chairman, and

• such number of other official or non-official members represent ing such interests as may be prescribed. 

Continued…

Objects of the Central Council.—

The objects of the Central Council shall be to promote and protect the rights of the consumers such as,— 

• the right to be protected against the marketing of goods and services which are hazardous to life and property;

Continued…

• the right to be assured, wherever possible, access to a variety of goods and services at competitive prices;

• the right to be heard and to be assured that consumer's interests will receive due consideration at appropriate forums;

Continued…

• the right to be informed about the quality, quantity, potency, purity, standard and price of goods or servicesthe right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of con sumers; and

• the right to consumer education. 

Procedure for meetings of the Central Council.

• The Central Council shall meet as and when necessary, but at least one meeting of the Council shall be held every year. 

• The Central Council shall meet at such time and place as the Chairman may think fit and shall observe such procedure in regard to the transaction of its business as may be prescribed. 

State Consumer Protection Councils.

The State Council shall consist of the following members, namely:—

• the Minister incharge of consumer affairs in the State Government who shall be its Chairman;

• such number of other official or non-official members representing such interests as may be prescribed by the State Government.

• such number of other official or non-official members, not exceeding ten, as may be nominated by the Central Government.

Continued…

Procedure for meetings of the State Council.

The State Council shall meet as and when necessary but not less than two meetings shall be held every year.

The State Council shall meet at such time and place as the Chairman may think fit and shall observe such procedure in regard to the transaction of its business as may be prescribed by the State Government.

Objects of the State Council. —

The objects of every State Council shall be to promote and protect within the State the rights of the consumers.

Continued…

District Consumer Protection Council

It consist of the following members, namely—

• the Collector of the district (by whatever name called), who shall be its Chairman;

• such number of other official and non-official members representing such interests as may be prescribed by the State Government.

Procedure for meetings of the District Council.

The District Council shall meet as and when necessary but not less than two meetings shall be held every year.

The District Council shall meet at such time and place within the district as the Chairman may think fit and shall observe such procedure in regard to the transaction of its business as may be prescribed by the State Government.

The objects of every District Council shall be to promote and protect within the district the rights of the consumers

Continued…

CONSUMER DISPUTES REDRESSAL AGENCIES

Redressal Forums.

• District Forums - a Consumer Disputes Redressal Forum to be known as the "District Forum" established by the State Government in each district of the State by notification:

Each District Forum shall consist of,— 

• a person who is, or  has been, or is qualified to be a District Judge, who shall be its President;

• two other members, one of whom shall be a woman, who shall have the following qualifications, namely —

Continued…

– be not less than thirty-five years of age,– possess a bachelor's degree from a

recognised university,– be persons of ability, integrity and standing,

and have adequate knowledge and experience of at least ten years in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration:

Continued…

Jurisdiction of the District Forum.

The District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed ''does not exceed rupees twenty lakhs. 

• State Commission - A Consumer Disputes Redressal Commission to be known as the "State Commission" established by the State Government in the State.

Continued…

Each State Commission shall consist of— 

• A person who is or has been a Judge of a High Court, appointed by the State Government, who shall be its President.

Continued…

• not less than two, and not more than such number of members, and one of whom shall be a woman, who shall have the following qualifications, namely:—

- be not less than thirty-five years of age;- possess a bachelor's degree from a recognised

university;- be persons of ability, integrity and standing, and have

adequate knowledge and experience of at least ten years in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration:

Continued…

Jurisdiction of the SC

The State Commission shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed ''exceeding rupees twenty lakhs but less than one crore”. 

• National Commission - A National Consumer Disputes Redressal known as the " National Commission” is established by the Central Government .

Continued…

Jurisdiction of the National Commission.

The National Commission. shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed ''exceeding rupees one crore”.