UNIT 12 - CONSUMER PROTECTION

Protecting consumers from unfair trade practices, adopted by the producers and sellers of goods and
services is termed as consumer protection. The market forces have changed from Seller market i.e.,
CAVEAT EMPTOR- ‘Let the buyer beware’, to Buyer/Consumer market i.e., CAVEAT VENDITOR- ‘Let the
seller beware’.

It not only includes educating consumers about their rights and responsibilities, but also helps in getting
their grievances redressed. Generally, consumers are exploited by- (1) Adulteration (2) Poor quality (3)
Duplicate goods (4) Malfunctioning of weights & measures (5) Black marketing (6) Overcharging (7)
Defective goods (8) Misleading advertisements & (9) Inferior services.

Importance of Consumer Protection (from consumer’s point of view):

1. Consumers Ignorance:
● Consumers are not aware of their rights and reliefs available to them.
● As a result, they are exploited.
● In order to save consumers from exploitation, consumer protection is needed.
2. Unorganised Consumers:
● Consumers are still unorganised and there is lack of consumer organisations also.
● Thus, consumer protection is required.
3. Widespread exploitation of Consumers:
● Consumers are exploited by businessmen.
● They use various unfair trade practices.
● Consumer protection is required to protect them from exploitation.

Importance of Consumer Protection (from the point of view of Business): -

1. Long term business interest:

● Business should keep its customer satisfied.
● Satisfied customers lead to repeat sales and help in increasing customers.
2. Moral Justification:
● It is the moral duty of any business to take care of consumer interest.
● They should not use unfair trade practices like adulteration, false and misleading
advertising, hoardings, black marketing etc.
3. Business uses resources of society:
● Every business uses the resources of the society.
● It is their responsibility to work in the interest of the society.
4. Social Responsibility:
● A business has social responsibilities towards various groups like owners, workers,
government, customers etc.
● Thus, customers should be provided qualitative goods at reasonable prices.
5. Government Intervention:
 ● If a business engages in any form of unfair trade practices, then government takes
action against it.
● It will adversely affect its goodwill.

CONSUMER PROTECTION ACT, 2019 (CPA, 2019)

Meaning of Consumer
A consumer is
● A person who buys any goods or avails services for a consideration, which has been paid or
promised, or partly paid and partly promised, or under any scheme of deferred payment.

This definition includes-

● Approval of buyer is essential.
● Both offline and online transactions- electronic media, teleshopping, direct selling or
multilevel marketing.
But does not include people who obtain goods or avails services for some commercial purpose.

Rights of a Consumer-

Consumer protection Act, 2019 has provided six rights to the consumers, which are as follows: -

1. Right to Safety:
● Consumer has the right to be protected against products, & services which are
hazardous to health & life
● The educated consumer should use ISI marked electronic & electrical appliances, as an
assurance of quality.
2. Right to be informed:
● Consumer has right to have complete information about the product before buying it.
● Information – ingredients, date of manufacture, price, quantity, directions to use etc.
● The manufacturer has to provide complete information on the package and label of
each product.
3. Right to be assured(Choose):
● Consumer has a right to choose any product out of the available products as per his own
decision and choice.
● The seller needs to offer wide variety of products to allow the consumer to make a
choice.
4. Right to be heard:
● Consumer has the right to file a complaint and to be heard in case he is not satisfied
with goods or services.
● Business firms have set up their consumer service and grievance cells.
● Consumer welfare organisations have also been set up to help aggrieved customers get
redressal of their grievances.
5. Right to Seek Redressal:
 ● Consumer has the right to get relief against unfair restrictive trade practices or
exploitation by seller/manufacturer.
● Also, in case he does not get satisfaction from the product or service purchased.
● He may be provided with replacement / removal of defect or compensation paid for any
loss.
● Various redressal forums are set up by the Govt. at National and State level.
6. Right to consumer education: -
● Consumer should be made aware of his rights and reliefs available to him.
● The Govt. of India has included consumer education in the school curriculum & is
making use of media to make consumers aware of their rights.
● Many business firms and consumer organisations are actively involved in educating
consumers.

Responsibilities / Duties of a Consumer

1. Consumer must make an intelligent choice: Consumers must be aware of about the various
goods and services available in the market and make a wise choice.
2. Consumer must be a Cautious consumer: While buying a product or services, a consumer should
read labels carefully.
3. Consumer must file a complaint in an appropriate forum in case of any shortcoming in product /
service availed.
4. Consumer must insist on cash memo i.e., a proof of purchase is required to file a complaint.
5. Consumer must be quality conscious. He should ask / look for ISI mark on electric goods. FPO
mark on food products, Hall mark on jewellery etc.
6. Consumer must learn about the risks associated with the products and services.
7. Consumer must assert and get a fair deal for oneself.
8. Consumer must choose only legal goods and discourage black marketing, hoarding etc.
9. Consumers must form societies to educate consumers to safeguard their interests.
10. Consumers must not be a cause of pollution.

Who Can File a Complaint under CPA, 2019?

A complaint before the appropriate consumer forum can be made by: -

(1) A consumer.

(2) Any registered voluntary consumer association.

(3) The central or state government.

(4) One or more consumers on behalf of numerous consumers having same interest.

(5) A legal heir or representative of a deceased consumer.

(6) The Central Authority

(7) A parent or legal representative in case of a minor

Against whom a complaint can be filed

1. The seller, manufacturer or dealer of defective goods.

2. The provider of services if they are deficient

REDRESSAL AGENCIES UNDER CONSUMER PROTECTION ACT, 2019

For the redressal of consumer grievances, the act provides a three - tier machinery as: -

1. DISTRICT COMMISSION:
● District commission are set up by the State Government.
● It can receive consumer complaints where value of goods and services paid as
consideration does not exceed one crore rupees.
● During the course of hearing, if commission feels there can be a settlement and parties
are agreeing, it can ask the parties to give their consent for settlement through
mediation within five days.
● If complaint is of a defect the product samples are sent to lab for testing.
● If complaint is of a deficient service the service provider can be asked to submit
documents and records.
● If not satisfied with the order the consumer can file an appeal with State Commission
within 45 days from the date of passing the order.
2. STATE COMMISSION
● It is set up by the State Government.
● It can receive consumer complaints where value of goods and services paid as
consideration exceeds one crore but does not exceed ten crore rupees.
● If not satisfied with the order the consumer can file an appeal with National
Commission within 30 days of the passing of the order.
3. NATIONAL COMMISSION
● It is set up by Central Government.
● It can receive consumer complaints where value of goods and services paid as
consideration exceeds ten crore rupees.
● If not satisfied with order of the commission consumer can file an appeal with Supreme
Court with 30 days of passing of the order.

Any order of District Commission, State Commission or National Commission is deemed final if no appeal
for such order is made by any of the parties involved in the dispute.

REMEDIES/RELIEF AVAILABLE TO CONSUMERS

1. To remove the defect in goods or services.

2. To replace the defective product with new one free from defect.
3. To refund the price paid for the product/service.

4. To pay compensation for the loss or injury suffered by the consumer due to product/service.

5. To discontinue the unfair trade practice and not to repeat them.

6. Not to offer hazardous goods for sale.

7. To withdraw the hazardous goods from sale.

8. To pay punitive damages in appropriate circumstances

9. To cease manufacture of hazardous goods and desist from offering any hazardous services

10. To compensate for any loss or injury suffered by the consumer under product liability action and
withdraw hazardous products from being offered for sale.

ROLE OF CONSUMER ORGANISATIONS/NGO

Some important consumer organization and NGO's engaged in protecting consumers interests are: -

1. Consumer coordination council, Delhi.

2. Voluntary organisation in Interest of Consumer Education, Delhi.

3. Mumbai Grahak Panchayat, Mumbai.

4. Consumer Association, Kolkata.

5. Consumer Unity and Trust Society Jaipur.

Role of Consumer organisations and NGO's

1. Educating the general public about consumer rights by organising training programmes, seminars and
workshops.

2. Publishing periodical & other publications to educate consumers.

3. Providing legal assistance to consumers by providing legal advice etc.

4. Carrying out comparative testing of consumer products in accredited labs to test qualities of
competing brands and publish the test results for the benefit of consumers.

5. Filing complaints in appropriate consumer courts on behalf of consumers.

6. Encouraging consumers to take on action against unfair trade practices.

7. Taking an initiative in filing cases in consumer courts on behalf of consumers.

TERMS DEFINITIONS
COMPLAINT Any allegation in writing made by the complainant for obtaining relief with
respect to restrictive trade practice, defect in goods of deficiency in services
provided, overcharging of price etc.

COMPLAINANT One or more consumers, or any voluntary consumer association etc. (same as
‘Who can file a complaint’)

SPURIOUS GOODS Goods that are falsely claimed to be genuine.

UNFAIR TRADE A trade practice, for the purpose of promoting sale, use or supply of any goods
PRACTICE or service falsely represents its quality, standard, quantity, composition, style or
model.

RESTRICTIVE TRADE A trade practice which manipulates price or affect the flow of supplies in the
PRACTICE market relating to goods and services in such a manner that an unjustified cost is
imposed on the consumer.

DEFECT Any fault, imperfection, shortcoming or inadequacy in quality, nature and

manner of performance in relation to goods or a product

DEFICIENCY Any fault, imperfection, shortcoming or inadequacy in quality, nature and

manner of performance in relation to any service and includes act of negligence
or omission or commission or withholding relevant information which caused
loss or injury to the consumer.

INJURY Any harm illegally caused to any person in mind, body or property.

PRODUCT Any article or goods or substance or raw material or any extended cycle of such
product either gaseous, liquid or solid state possessing intrinsic value of capable
of delivery either as assembled or a component produced or manufactured to
trade. It does not include human tissues, blood, blood products and organs.

PRODUCT SELLER Any person in the course of business imports, sells, distributes, leases, installs,
prepares, labels, markets, repairs, maintains or otherwise involved in placing the
product for commercial use or a service provider.

PRODUCT LIABILITY Responsibility of a product manufacturer or seller of any product or service to

compensate for any harm caused to a consumer by defective product
manufactured or sold or by deficiency in services.