Project On Consumer Protection
Project On Consumer Protection
INTRODUCTION
We buy a variety of goods and services in our day-to-day life. Whatever we buy we pay for it
and derive satisfaction from its consumption and use. But sometimes we do not feel satisfied
with the product we buy. This may be on account of poor quality of the product, overcharging by
the shopkeeper, lower quantity of contents, misleading advertisement, and so on. Should we
allow these practices to continue? Obviously not; then is there any remedy for such
malpractices? The answer lies in the concept and practice of consumer protection, the rights and
responsibilities of consumers, legal provisions and mechanism for settlement of consumer
grievances.
MEANING OF CONSUMER
In other words, it refers to the measures adopted for the protection of consumers from
unscrupulous and unethical malpractices by the business and to provide them speedy redressal of
their grievances. The most common business malpractices leading to consumer exploitation are
given below.
(a) Sale of adulterated goods i.e., adding something inferior to the product being sold.
(b) Sale of spurious goods i.e.,selling something of little value instead of the real product.
(c) Sale of sub-standard goods i.e., sale of goods which do not confirm to prescribed quality
standards.
(d) Sale of duplicate goods.
(e) Use of false weights and measures leading to underweight.
(f) Hoarding and black-marketing leading to scarcity and rise in price.
(g) Charging more than the Maximum Retail Price (MRP) fixed for the product.
(h) Supply of defective goods.
(i) Misleading advertisements i.e., advertisements falsely claiming a product or service to be of
superior quality, grade or standard.
(j) Supply of inferior services i.e., quality of service lower than the quality agreed upon.
The above instances show the exploitation of consumers in the context of goods and services. In
a democratic nation like India, should we allow this to happen? So the measures adopted by the
government or non-government organizations (NGOs) for safeguarding the interests of the
consumers constitute consumer protection.
● The tickets issued to different passengers on the same day for the same journey showed
the same seat number
● Penalty of Rs. 50 was charged by SBI after issuing the chequebook to the customer
showing that the balance available in the account was less than the minimum required
balance for issue of chequebook.
● The supply of cooking gas cylinder to the consumers is found to be underweight.
RIGHTS OF CONSUMERS
John F, Kennedy, the former USA President, in his message to consumer had given six rights to
consumers. These rights are (i) right to safety, (ii) right to be informed, (iii) right to choose, (iv)
right to be heard, (v) right to redress and (vi) right to represent. These rights had paved the way
for organized consumer movement in the USA and later it spread all over the world. In India, the
Protection Act, 1986 has also provided for the same rights to consumers. Let us have a brief idea
about these rights of consumers.
(a) Right to Safety
It is the right of the consumers to be protected against goods and services, which are hazardous
to health or life. For example, defective vehicles could lead to serious accidents. The same is true
of electrical appliances with sub-standard material. Only recently, there were mass protests and
boycott of soft drinks due to presence of hazardous pesticides beyond permissible limits. Thus,
right to safety is an important right available to the consumer, which ensures that the
manufacturers shall not produce and sell sub-standard and dangerous products.
(b) Right to be Informed
The right to be informed is an important component of consumer protection. The consumer must
be provided with adequate and accurate information about quality, quantity, purity, standard and
the price of the goods & services. Now-a-days the manufacturers provide detailed information
about the contents of the product, its quantity, date of manufacturing, date of expiry, maximum
retail price, precautions to be taken, etc. on the label and package of the product. Such
information helps the consumers in their buying decision and use of the product.
(c) Right to Choose
The right to choose provides that the consumer must be assured, whenever possible, access to a
variety of goods and services at competitive prices. If the market has enough varieties of
products at highly competitive prices, the buyers have an opportunity of wide selection.
However, incase of monopolies like railways, postal service and electricity supply etc. it implies
a right to be assured of satisfactory quality of service at a fair price.
(d) Right to be Heard
The rights to safety, information and choice will be frivolous without the right to be heard. This
right has three interpretations. Broadly speaking, this right means that consumers have a right to
be consulted by Government and public bodies when decisions and policies are made affecting
consumer interests. Also, consumers have a right to be heard by manufactures, dealers and
advertisers about their opinion on production, marketing decisions and any grievances of the
consumers. Now-a-days, most of the top manufacturers and firms have set up consumer service
cells to attend to consumers’ complaints and take appropriate steps for their redressal. Thirdly,
consumers have the right to be heard in legal proceedings in law courts dealing with consumer
complaints.
(e) Right to Seek Redressal
The consumers have been given the right of redressal of their grievances relating to the
performance, grade, quality etc. of the goods and services. If required, the product must be
repaired / replaced by the seller/ manufacturer. The Consumer Protection Act has duly provides
for a fair settlement of genuine grievances of the consumers. It has also set up a proper
mechanism for their redressal at district, state and national levels.
(f) Right to Consumer Education
It means the right to receive knowledge and skill to become informed consumer. In this direction
the consumer associations, educational institutions and the policy makers can play an important
part. They are expected to impart information and knowledge about
(i) the relevant laws, which are aimed at preventing unfair trade practices, (ii) the ways and
means which dishonest traders and producers may adopt to deceive the consumers,
(iii) insistence on a bill or receipt at the time of purchase, and
(iv) the procedure to be followed by consumers while making complaints. Effective consumer
education leads to an increased level of consumer awareness and help them to enforce their
rights more effectively, and protect themselves against fraudulent, deceitful and grossly
misleading advertisement, labeling, etc.
(v)
OTHER CONSUMER RIGHTS.
RESPONSIBILITIES OF CONSUMERS
Consumer responsibilities include the following:
(a) Be quality conscious
To put a stop to adulteration and corrupt practices of the manufacturers and traders, it is the duty
of every consumer to be conscious of the quality of product they buy. They should look for the
standard quality certification marks like ISI, Agmark, FPO, Woolmark, Eco-mark, Hallmark etc.
while making the purchases.
The consumer should inspect a variety of goods before buying the goods and service. For this
purpose he/she should compare their quality, price, durability, after sales service etc. This would
enable the consumers to make the best choice within the limit of their own resources.
(d) Collect proof of transaction
The consumer should insist on a valid documentary evidence (cash memo/invoice) relating to
purchase of goods or availing of any services and preserve it carefully. Such proof of purchase is
required for filing a complaint. In case of durable goods the manufactures generally provide the
warrantee/guarantee card along with the product. It is the duty of consumers to obtain these
documents and ensure that these are duly signed, stamped and dated. The consumer must
preserve them till the warrantee/
guarantee period is over.
(e) Consumers must be aware of their rights
The consumers must be aware of their rights as stated above and exercise them while buying
goods and services. For example, it is the responsibility of a consumer to insist on getting all
information about the quality of the product and ensure himself/ herself that it is free from any
kind of defects.
(f) Complaint for genuine grievances
As a consumer if you are dissatisfied with the product/services, you can ask for redressal of your
grievances. In this regard, you must file a proper claim with the company first. If the
manufacturer/company does not respond, then you can approach the forums. But your claim
must state actual loss and the compensation claim must be reasonable. At no cost fictitious
complaints should be filed otherwise the forum may penalize you.
purchases and consumption should not lead to waste of natural resources and energy and
environmental pollution.
The definition of “consumer” has been expanded to include persons who engage in offline or
online transactions through electronic means or by tele-shopping or direct selling or multi-level
marketing.1 In our transactions concluded in all media in any case covered by CPA 1986.
The definition now provides consumers with a remedy in case of multi-level marketing. Thus,
the seller at each level of multi-level marketing can be exposed to liability under CPA 2019 and
not restricted to only the manufacturer of the product but all entities involved at various stages of
production and marketing.
When services are provided for free, the person availing the service will not be considered as a
consumer. Whether or not the service being provided is free is a question of fact and will have to
be evaluated on case to case basis.
• E-commerce
E-commerce has been defined as buying or selling of goods or services including digital products
over digital or electronic network.2 The central government has been authorized to take measures
and make rules to prevent unfair trade practices in e-commerce. 3 In case of products being sold
through online platforms, without charging any fees separately amounts to providing services
needs to be ascertained. It is not clear whether off-shore e-commerce would also get covered and
eventual enforcement of CPA 2019 qua such entities.
In the previous legislation, a complaint could be filed only if an unfair trade practice or a
restrictive trade practice was adopted by any trader or service provider. Now “unfair contract”
has also been added which further broadens the ground to file complaints and allows consumers
to challenge contracts which are unfair, unilateral and unreasonable. Unfair contract has been
defined to include contracts between a manufacturer or trader or service provider on one hand,
and a consumer on the other, having such terms which cause significant change in the rights of
such consumer, including the following
1. requiring manifestly excessive security deposits to be given by a consumer for the
performance of contractual obligations; or
2. imposing any penalty on the consumer, for the breach of contract thereof which is wholly
disproportionate to the loss occurred due to such breach to the other party to the contract; or
3. refusing to accept early repayment of debts on payment of applicable penalty; or entitling
a party to the contract to terminate such contract unilaterally, without reasonable cause; or
4. permitting or has the effect of permitting one party to assign the contract to the detriment
of the other party who is a consumer, without his consent; or
5. imposing on the consumer any unreasonable charge, obligation or condition which puts
such consumer to disadvantage.
The above provisions would directly impact the financial institutions such as banks, as the apex
court has already stated that the Banks also get covered under the Act. 8 This would specifically
take into account contracts entered with banks, e-commerce platforms where parties are not left
with any option but to agree to the standard terms to avail the services. With such a broad
subjective definition, it remains to be seen how courts would interpret in case of online contracts.
3. disclosure of consumer’s personal information to any other person unless such disclosure is
made in accordance with the provisions of any law for the time being in force or in public
interest.
The provision fails to give any clarity whether information can be shared if consent is taken from
the consumers. The reliance will have to be placed on prevalent data protection law. The current
data protection law in India does not require any specific compliance for data sharing in case the
information is not in the nature of sensitive information i.e. relating to (i) passwords; (ii)
financial information; (iii) physical, physiological and mental health conditions; (iv) sexual
orientation; (v) medical records and history; (vi) biometric information; (vii) any detail relating
to the above, as provided to a body corporate for providing services; and (viii) any of the
information received under the above by a body corporate, for processing or storing data under
lawful contract, or otherwise.
• Product Liability
There was no separate legislation governing ‘product liability’ in India, though it was addressed
under CPA 1986, if parties were included within the ambit of ‘consumer’. Insertion of “Product
Liability” as a separate chapter in CPA 2019 and a new ground for filing a complaint has been
one of the most significant additions to the act
Section 2(35) of CPA 2019 allows a person to make a claim of product liability against such
manufacturer, seller or service provider for such defective products. Product liability means the
responsibility of a product manufacturer or product seller, of any product or service, related to
the product to compensate for any harm caused to a consumer by such defective product
manufactured or sold or by deficiency in services relating to the product.
CPA 2019 has gone a step forward and defined a product manufacturer 13, product seller14 and
product service provider15 to provide clarity on who can be made liable for an action under
Chapter VI of CPA 2019.
5. issuance of safety notices to consumers against unsafe goods and services and guidelines to
prevent unfair trade practices
The district collectors have also been empowered to conduct such investigations that affect
interests of consumer as a class under CPA 2019. They can investigate or inquire at the instance
of a complaint or on a reference made by CCPA. The district collectors have also been provided
powers akin to CCPA’s but unlike CCPA they cannot initiate action suo moto. The establishment
of a central authority and initiating action as a class comes as an additional mode of relief which
can be exercised along with individual consumers filing complaints to address their grievances
thereby having two parallel proceedings.
CCPA has also been empowered to take actions against false or misleading advertisements.
CCPA can impose a penalty of up to INR1 million, and up to INR 5 million for every subsequent
violations. It is important to note that such penalty can be imposed on endorsers too, thereby
bringing actors/actresses in the scope of penalty. However, the endorser would be exempted
from any liability if s/he establishes that they undertook due diligence to verify the veracity of
the claims before endorsing the same. Therefore, endorsers/actors/celebrities will also have to
conduct a thorough due diligence/ research before signing up for any advertisements.
The pecuniary jurisdiction of all three commissions have been raised under CPA 2019. The
changes are reflected in the table below:
The increase in the pecuniary jurisdiction of all three commissions is an encouraging step as it
should attract lesser number of claims in appellate commissions to an extent, thereby ensuring
swifter disposal of cases,
• Mediation
The CPA 2019 now provides for settlement of disputes by way of mediation in case there is a
possibility of settlement at the stage of admission of complaint or at any later stage, if acceptable
to both parties. A mediation cell will be attached to each district, state and National Commission
and its regional Benches for quick resolution.
• Penalties
The quantum of monetary penalty, in case of defiance of any order of commissions, have also
been raised under the provisions of CPA 2019. The commissions can now impose fines ranging
from USD 350 to USD 1400, whereas earlier they could have only imposed fines in the range of
USD 28- USD 140.
• Miscellaneous Provisions
Apart from the afore-mentioned changes, CPA 2019 has introduced ADR mechanisms to resolve
the disputes. Mediation cells have been attached to all the three commissions. Matters shall be
referred to mediation cells if the parties’ consent to it. In event of failure to settle the dispute, the
respective commissions shall continue to adjudicate the dispute. CPA 2019 now allows
consumers to file complaints in the district commission where they reside or work for gain.
JAAGO GRAHAK JAAGO PROGRAMME(WAKE UP CONSUMER)
DCD initiated a multi - media campaign for the Department of Consumer Affairs to generate
awareness on consumer rights. The campaign features the popular programme “Jaago Grahak
Jaago” which has done great public service. The programme has apprised consumers of the tricks
used by mischievous persons, traders, businessmen and service providers to cheat them.
The campaign also informs consumers about product safety, product defects, food adulteration,
and environmental hazards. This programme has been on air since May 2005. In addition,
several public service advertisements on consumer rights are telecast from eight Kendras in eight
States in an equal number of languages and dialects. Realising the need for empowering
consumers, the government has approved a scheme of Rs 409 crore during the 11th five-year
Plan on the awareness campaign aimed at helping the emergence of consumers who irrespective
of age, socio-economic class or gender are empowered enough to make free, fair, and informed
choices of products or services. Under its "Jago Grahak Jago" initiative, the department has tried
to reach consumers through print advertisements in national as well as regional newspapers, TV
spots in Doordarshan and private channels, audio spots in All India Radio and private FM
channels.
In 2005, the government set up the Consumer Online Resource and Empowerment Centre
(CORE) - External website that opens in a new window to provide fast and convenient grievance
redressal services as well as consumer resources to the citizens of India. The Consumer
Coordination Council - External website that opens in a new window, a premier organization in
the field of consumer movement of India, recommended the setting-up of the CORE Centre.
With a view to promote Consumer Sovereignty, CORE works in the interest of consumers to
resolve their complaints and avoid unnecessary litigation for brands. It is both an effective one
point source for complaint redressal as well as a nodal agency to protect the interests of Indian
Consumers.
Moreover, a National Toll Free Number has been provided to offer guidance to citizens on all
consumer related issues. One may dial now, for more information about consumer courts,
consumer organizations and procedure for redressal.