NOTES BY: MS.

BHAIRAVI MEHTA
TERM II
CHAPTER 12 – CONSUMER PROTECTION
INTRODUCTION –
❖ Since time immemorial, businessmen have been inclined to adopt
unfair and manipulative techniques, so as to maximise their profits.
❖ At the same time, there are various initiatives to promote consumer
protection have gained momentum because –
1. The regulatory framework established by the government in the
form of various institutions and laws
2. And also due to the growing awareness of the consumers.
❖ The scope of consumer protection is very wide, as it aims at not only
providing education to the consumers about their rights and
responsibilities but also helping them in getting their grievances
redressed.
CONCEPT –
❖ Over the years, the approach to marketing has changed from being
buyer oriented to seller oriented.
❖ A consumer enjoys a dominant position in the present day consumer-
oriented marketing and is often referred to as a ‘KING’ in free market
economy.
❖ Consequently, the approach of ‘CAVEAT EMPTOR’, which means “LET
THE BUYER BEWARE”, has now been replaced with ‘CAVEAT VENDITOR’
i.e., “LET THE SELLER BEWARE”.
❖ This perspective cautions that the seller is responsible for any problem
that the buyer might come across with the use of service or product.
❖ Due to ever growing competition and in an attempt to maximise profits
by selling more, some marketers are tempted to engage in
unscrupulous, exploitative and unfair trade practices like – defective
and unsafe products, adulteration, false and misleading advertising,
hoarding, black-marketing, etc.
❖ This means that a consumer might be exposed to risks due to unsafe
products, might suffer from bad health due to adulterated food
products, might be cheated because of misleading advertisements or
 sale of spurious products, might have to pay a higher price when
sellers engage in over-pricing, hoarding or black-marketing, etc.
❖ Therefore, there is a strong need for consumer protection.
❑ CONSUMER PROTECTION HAS A WIDE AGENDA:-
1. It not only includes educating consumers about their rights and
responsibilities, but also helps in getting their grievances redressed.
2. It not only requires a judicial machinery for protecting the interests of
consumers but also requires the consumers to get together and form
themselves into consumer associations for protection and promotion of
their interests.
❑ MEANING OF CONSUMER PROTECTION:-
➢ Consumer protection refers to regulatory framework of laws and
organisations that have been the set to promote the rights of
consumers as well as fair trade, competition and flow of accurate
information in the market place.
➢ Consumer Protection refers to the act of providing adequate protection
to consumers against the unscrupulous, exploitative and unfair trade
practices of manufacturers and service providers.
❖ CONSUMER PROTECTION ADOPTS MEASURES TO PROTECT CONSUMERS
FROM UNETHICAL MALPRAACTICES BY BUSINESSES AND PROVIDE A
SWIFT REDRESSAL OF THEIR GRIEVANCES WITH REGARD TO –
1. Sale of adulterated goods such as adding inferior substances to the
product being sold.
2. Sale of counterfeit goods such as selling a product of lesser value than
the real product.
3. Sale of sub-standard goods such as the sale of products that do not
meet the prescribed quality standards.
4. Sale of duplicate goods.
5. Use of malfunctioning weights and measures that lead to underweight
of products.
6. Black marketing and hoarding that eventually leads to scarcity of the
product and well as a rise in the price of the same.
7. Overcharging a product, i.e., charging a product above its Maximum
Retail Price.
8. Supplying defective goods.
9. Advertisements that are misleading, i.e., advertisements that falsely
claim a product or a service to be shown as superior quality, grade or
standard when not in real.
10. Supply of inferior services, i.e., quality of service lesser than the
condition agreed.
IMPORTANCE OF CONSUMER PROTECTION FROM CONSUMER’S POINT
OF VIEW –
1. CONSUMER IGNORANCE:
➢ It is very important to provide protection to the consumers
considering the fact that majority of the consumers are ignorant.
➢ Therefore, it is essential in order to protect and promote interest of
the consumers by making them aware of their rights and
responsibilities.
2. UNORGANISED CONSUMERS:
➢ Consumers need to be organised in the form of consumer
organisations, which would take care of their interests.
➢ Though, in India, we do have consumer organisations which are
working in this direction, adequate protection is required to be given
to consumers till these organisations become powerful.
3. WIDESPREAD EXPLOITATION OF CONSUMERS:
➢ Consumers might be exploited by unscrupulous, exploitative and
unfair trade practices like defective and unsafe products,
adulteration, false and misleading advertising, hoarding, black-
marketing, etc.
➢ Consumers need protection against such malpractices of the sellers.
IMPORTANCE OF CONSUMER PROTECTION FROM BUSINESSMAN’S
POINT OF VIEW –
1. LONG TERM INTEREST ON BUSINESS –
➢ In this highly competitive world, enlightened business firms have
realized that they can exist in long-run only when they satisfy the
consumers.
- Satisfied customers not only bring repeat sales but also add new
customers by providing good feedback about the firm.
- So, business firms should aim at long-term profit maximization
through customer’s satisfaction.
2. BUSINESS USES SOCIETY’S RESOURCES –
➢ Business makes use of various resources, which belong to the society.
- Businessmen are not the owners but merely the trustees of such
resources.
- So, it is their responsibility to supply such products and render such
services which are in public interest and would not impair public
confidence in them.
3. SOCIAL RESPONSIBILITY –
➢ A business has social responsibilities towards various interest
groups (stakeholders).
➢ Business firms make money by selling goods and providing services
to consumers.
➢ So, consumers form an important group among the many
stakeholders.
➢ Like other stakeholders, consumers’ interest needs should be well
taken care off.
4. MORAL JUSTIFICATION –
➢ It is the moral duty of the business to take care of consumer’s interest
and avoid any form of their exploitation.
➢ Thus, a business must avoid unscrupulous, exploitative and unfair
trade practices like defective and unsafe products, adulteration, false
and misleading advertising, etc.
5. GOVERNMENT INTERVENTION –
➢ Government is actively involved in the protection of consumer rights.
➢ Any unfair trade practice by a business firm would invite government
intervention, which may hamper image of the business.
➢ So, business organisations should voluntarily involve in such
practices, which protect the interest of consumers.
CONSUMER PROTECTION ACT, 2019 –
➢ The Consumer Protection Act seeks to protect and promote the
interests of consumers through speedy and inexpensive redressal of
their grievances.
➢ The scope of the Act is very wide. It applies to all undertakings,
irrespective of size, nature or ownership, whether supplying goods or
providing services including e-commerce firms.
➢ THE MAIN FEATURES OF THE ACT ARE:
1. The Act has granted certain rights to the consumers to empower
them and to protect their interests.
2. The Act safeguards consumers against defective goods, deficient
services, unfair trade practices and other forms of exploitation.
3. The Act provides a three-tier machinery – District Forum, State
Commission and National Commission, to provide simple, quick and
easy remedy to consumers.
WHO IS A CONSUMER?
❖ The word consumer is derived from the Latin word ‘Consumere’
which means, to eat or to drink.
❖ The consumer is the one who consumes or uses any commodity or
service available from natural resources or through a market.
❖ 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.
❖ It includes any user of such goods or beneficiary of services if such
use is made with the approval of the buyer.
❖ It applies to both offline and online transactions through electronic
means or by teleshopping or direct selling or multilevel marketing.
❖ However, any person who obtains goods or avails services for resale
or commercial purpose is not treated as a consumer.
WHO CAN FILE A COMPLAINT?
a) Any consumer
b) Any registered consumer’s association
c) One or more consumers, on behalf of numerous consumers having the
same interest.
d) The Central Government or the State Government.
e) A legal heir or representative of a deceased consumer.
 AGAINST WHOM A COMPLAINT CAN BE FILED?
A complaint can be filed against:
• The seller, manufacturer or dealer of goods which are defective.
‘Defect’ means any fault, imperfection or shortcoming in the
quality, quantity or purity of goods.
• The provider of services if they are deficient in any manner.
‘Deficiency’ means any imperfection, shortcoming or inadequacy
in the quality, nature and manner of performance of services.

CONSUMER RIGHTS –
1. RIGHT TO SAFETY:
❖ According to this right, consumer has a right to be protected against
goods and services which are hazardous to life, health and property.
❖ Right to safety is important for safe and secured life.
❖ Right to safety should be in relation to medicines, electrical
appliances, food, etc.
❖ The Government of India has given safety standards in the form of
AGMARK, ISI, BIS, HALLMARK, etc.
❖ Example – electrical appliances which are manufactured with
substandard products or don’t conform to the safety norms, might
cause serious injury.
- Thus consumers should use electrical appliances which are ISI marked as
it would be an assurance of such products meeting quality specifications.
2. RIGHT TO BE INFORMED:
❖ According to this right, consumer has a right to have complete
information about the product he intends to buys, including its
ingredients, date of manufacture, price, quantity, directions for use,
etc.
❖ In India, producers are under legal obligation to provide such
information on the package and label of the product.
❖ Such information protects the consumers from deceptive advertising,
misleading labelling, products with expired life, etc.
3. RIGHT TO BE ASSURED/ RIGHT TO CHOOSE:
 ❖ According to this right, every consumer has the right to choose from
the variety of goods and services of his or her likings, at competitive
prices.
❖ This implies that the marketer should offer wide variety of products
in terms of quality, brand, prices, size, etc.
❖ The marketer cannot force the customer to buy a particular brand
only and thus monopoly is prevented.
4. RIGHT TO BE HEARD:
❖ According to this right, the consumer has a right to file complaint and
to be heard in case of dissatisfaction with a good or service.
❖ In order to offer this right, many enlightened business firms have set
up their own consumer service and grievance cells.
❖ Also, several consumer organisations are also contributing towards
the fulfilment of this right in order to provide support to the
consumers in redressal of their grievances.
5. RIGHT TO SEEK REDRESSAL:
❖ According to this right, the consumer has a right to get relief in case
the product or service falls short of his/her expectations.
❖ A grieved consumer is entitled to suitable relief under the Consumer
Protection Act.
❖ This includes refund of the price, replacement of the product,
removal of defect in the product, compensation paid for any loss or
injury suffered by the consumer, etc.
6. RIGHT TO CONSUMER EDUCATION:
❖ According to this right, the consumer has a right to gain knowledge
and to be a well informed consumer throughout life.
❖ He/she should be conscious about his/her rights and the reliefs
available to him/her in case of a product or service falling short of his
expectations.
❖ In order to educate consumer several consumer organisations and
some enlightened businesses are making sincere efforts in this
regard.
❖ Example: The government of India has integrated consumer
education in the school curriculum and in various university courses.
CONSUMER RESPONSIBILITIES –
1. CONSUMER SHOULD HAVE KNOWLEDGE ABOUT MARKET:
▪ Consumers should be aware about various goods and services
available in the market so as to make an intelligent and wise buying
decision.
2. CONSUMER MUST BE QUALITY CONSCIOUS:
▪ Consumers must buy only standardized goods in order to be assured
of its quality.
▪ The buyer should check for related quality marks on the product like
– electrical goods for ISI mark, food products must bear FPO mark,
jewellery should carry hallmark, etc.
3. USE THE PRODUCTS SAFELY:
▪ Consumers must learn about the risks associated with products and
services and must follow manufacturer’s instructions and use the
products safely.
4. CONSUMER MUST REFER LABELS CAREFULLY:
▪ While purchasing a product , consumer must read labels carefully so
as to be aware about the prices, net weight, manufacturing and expiry
dates, etc.
5. INSIST ON CASH MEMO:
▪ Consumer must ask for cash memo on purchase of goods and services
so that it would serve as a proof of the purchase in case of any
eventuality at the time of filing a complaint.
6. CONSUMER MUST BE HONEST:
▪ Consumer must be honest in his dealings. A buyer should buy only
legal goods and services. A buyer should discourage malpractices like
black-marketing, hoarding, etc.
7. CONSUMER MUST FILE A COMPLAINT:
▪ Consumer should file a complaint in an appropriate consumer forum
in case of any defect in the product or deficiency in the service.
▪ The complaint must be filed even for a small loss.
8. FORM CONSUMER ORGANISATIONS:
▪ Consumers should form consumer societies which could play an
active part in educating them and safeguarding their interests.
9. RESPECT ENVIRONMENT:
▪ Consumer should save and respect the environment and avoid waste,
littering and contributing to pollution in any way.
10. Consumers should assert themselves to ensure that they get a fair
deal.
NOTE : DISTRICT FORUM, STATE COMMISSION AND NATIONAL
COMMISSION NOTES – REFER TO DIFFERENT FILES UPLOADED IN E-
LEARN UNDER CONSUMER PROTECTION FOLDER.
RELIEFS/REMEDIES AVAILABLE TO CONSUMERS –
❑ If the consumer court or redressal agency is satisfied about the
genuineness of the complaint, it can grant one or more of the following
reliefs to the aggrieved party –
1. To remove the defect in goods or deficiency in service.
2. To replace the defective product with a new one, free from any defect.
3. To refund the price paid for the product, or the charges paid for the
service.
4. To pay a reasonable amount of compensation for any loss or injury
suffered by the consumer due to the negligence of the opposite party.
5. To pay punitive damages in appropriate circumstances.
6. To discontinue the unfair / restrictive trade practice and not to
repeat it in the future.
7. Not to offer hazardous goods for sale.
8. To withdraw the hazardous goods for sale from the market.
9. To cease or stop the manufacture of hazardous goods and offering of
hazardous services.
10. To pay any amount (not less than 5% of the value of the
defective goods or deficient services provided), to be credited to the
Consumer Welfare Fund or any other organisation / person, to be
utilised in the prescribed manner.
11. To issue corrective advertisement to neutralise the effect of a
misleading advertisement.
12. To pay adequate costs to the appropriate party.
ROLE OF CONSUMER ORGANISATIONS AND NGO’s IN PROTECTING AND
PROMOTING CONSUMER INTERESTS –
1. PROVIDING EDUCATION –
▪ The consumer organisations and NGO’s work consistently towards
providing education to the general public on the subject of consumer
rights by conducting training programmes, seminars and workshops.
2. PUBLICATIONS –
▪ They undertake the publication of periodicals and other publications
to communicate about varies problems faced by consumers,
procedure for legal assistance, availability of reliefs and other issues
of consumer interest.
3. CONDUCTING QUALITY CHECKS –
▪ These organisations carry out comparative tests to ascertain the
quality standards of different types of consumer products in
accredited laboratories, furthermore, the feedback of such results
are also published for the benefit of consumers.
4. INITIATING PROTESTS –
▪ These organisations provide necessary confidence and support to the
grieved consumers so as to enable them protest strongly and take an
action against unscrupulous, exploitative and unfair trade practices
of the marketers.
5. LEGAL SUPPORT –
▪ They extend legal assistance to consumers required for seeking legal
justification through guidance, legal advice, etc.
6. MAKING COMPLAINTS –
▪ These organisations may also take initiative and file complaints in
appropriate consumer courts on behalf of the consumers.
7. PROMOTING PUBLIC INTEREST –
▪ These organisations may also initiate a legal procedure by filing
cases in consumer courts in the interest of the general public, not for
an individual.