Consumer

Protection Act
 Buys any goods for
a consideration
Buys capital goods
which has been
to provide services
paid or promised
to other individuals
or partly paid and
partly promised.

Who is A
consumer?
Uses the goods
Buys goods for the
with the approval
self-employment
of the buyer
 Who is not a consumer?

Any person who A person who

buys a commodity obtain services
with an intention without
to resale consideration

A person who
obtains services for Applications for
commercial jobs
purposes
 Deceptive and misleading techniques

False warranties or guarantees

Factors Non availability of goods

leading to
consumer
Adulteration
exploitation
Hoarding

Black marketing
Consumer protection act,1986

• To provide the better protection of the

interests of the consumer, the Consumer
Protection Bill, 1986 was introduced in Lok
Sabha on 5th December, 1986

• Is a social welfare legislation which was

enacted as a result of widespread
consumer protection movement

• Extends to the whole of India except the

State of Jammu and Kashmir
 Objective
• Better protection of interests of consumers

• Provide better speedy and simple redressal to

consumer disputes

• Protection of the rights of the consumers:

o The right to be protected against marketing
of goods which are hazardous to life and
property;
o The right to be informed about the quality,
quantity, potency, purity, standard and price
of goods to protect the consumer against
unfair trade practices;
 o The right to be heard and to be assured that
consumers interests will receive due consideration
Cont. o
at appropriate forums;
Right to consumer education
Goods

• Every kind of movable property

other than actionable claims and
money; and includes stock and
shares, growing crops, grass, and
things attached to or forming part
of the land which are agreed to be
severed before ale or under the
contract of sale.
 Services

• Services of any description which is

available of potential users and
includes, but not limited to, 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.
Defect
• Any fault, imperfection or
shortcoming in the quality,
quantity, potency, 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.
 COMPLAINT

•Any allegation in writing made by a

complainant to National Commission,
the State Commission or the District
Forum with a view to obtain relief
provided under this act.
 An unfair trade practice or
a restrictive trade practice
has been adopted by any
trader or service provider;

Written The goods bought or

allegations agreed to be bought suffer
from one or more defects;
include

The services hired or

availed of or agreed to be
hired or availed suffer from
deficiency in any respect.
 A trader or the Fixed by or Displayed on
service provider under any law the goods or
has changed for for the time any package
the goods or for being in force. containing such
the services goods.
mentioned in
Cont. the complaint, a
price in excess
of the price

Displayed on
the price list for the time Agreed
exhibited under being in force. between the
any law parties.
 Goods which will be hazardous to life
and safety when used are being
offered for sale to the public

In contravention of any standards

relating to safety of such goods as
Cont. required to be complied any law for
the time being in force.

If the trader could have known with

due diligence that the goods so
offered are unsafe to the public.
 Complainant
• A consumer

• Any voluntary consumer association registered under

the companies act,1956, or under any other law for
the time being in force 3)

• The central government or any state government,

who or which makes a complaint

• One or more consumers, where there are numerous

consumers having the same interest.

• In case of death of a consumer, his legal heir or

representative. (this clause has been introduced by
the CPA amendment act, 2002)
 The name , description and address of
the complainants and the opposite
party.

The facts relating to complaint and

when and where it arose.

How to file a Documents in support of allegations

in the complaint.
complaint
The relief which the complainant is
seeking.

The complaint should be signed by

the complainant or his authorized
agent.
Complaint cannot be filed
• A complaint on behalf of the public which
consists of unidentifiable consumers.

• A complaint by an individual on behalf of

general public.

• An unregistered association

• A complaint after expiry of limitation period

i.e after lapse of two years from the date on
which the cause of action arise unless the
Forum is satisfied about the genuineness of
the reason for not filing within the time
Unfair trade
practices
[sec. 2(1)
(r)]
 •Trade practices which a
trader, for the purpose
of promoting the sale,
use or supply of any
Definition goods or for the
provision of any
service, adopts any
unfair method or
unfair or deceptive
practice.
PATANJALI MISLEADING
ADVERTISEMENTS
 PATANJALI
• Founded in 2006 by Acharya Balakrishna
and Baba Ramdev.
• Balakrishna held 98% of equity and Baba
Ramdev being a sanyasi did not possess any
ownership share.
• Ramdev combined health, Ayurveda,
natural products, swadeshi and his public
presence to appeal to Indian customers.
• In 2017, Patanjali became fastest growing
FMGC company with growth in sales of
more than 100% in an year.
 • Section 2 (1) (r) of the
existing Consumer Protection
Act 1986 states that the
practice of making any
statement, whether orally or
in writing or by visible
representation which makes a
false or misleading
representation concern­ing the
need for, or the usefulness of,
any goods or services, falls
under unfair trade practices.
• A consumer can make a
complaint against unfair trade
CONSUMER practice in a Consumer Forum
established under the
PROTECTION ACT,1986 Consumer Protection Act,
1986
 Grievances Against Misleading
Advertisements (GAMA)
• The Department of consumer affairs has
recently launched a portal to enable
consumers to register Grievances Against
Misleading Advertisements (GAMA).
• After preliminary scrutiny of the grievances
registered on the portal, the grievances are
forwarded to the State Government
concerned or the respective Central Regulator
based on the subject matter.
 ASCI
• The Advertising Standards Council of India
(ASCI) is a voluntary self-regulatory body
of Advertisement Industry.
• It self-regulates advertising content to
monitor and decide on complaints against
advertisements making misleading, false
and unsubstantiated claims.
• In 2015, the government appointed ASCI
as its executive arm to process complaints
received on the GAMA portal about
misleading advertisements. ASCI also
receives direct complaints from citizens.
DANT KANTI(misleading info)
 THE
COMPLAINT

• Dr. Ashok Gupta from

Rajasthan filed a complaint
against the company in a local
court in April 2016 for a
misleading promotion of Dant
Kanti.
• In the complaint, he raised
doubts on the quality claimed
by the complainant. He was
also hurt by the ad that raised
doubts on the practising
doctors.
 THE
VERDICT
Later, the advertisements
about Patanjali Dant Kanti
was found to be misleading
since there was no scientific
data to prove the claims and
Patanjali was fined for Rs 11
Lakh for “misbranding and
putting up misleading
advertisements.”
The practices included are:

Making any statement, whether orally or in writing or by visible

representation which –

Falsely represents that the goods are of particular standard, quality,

quantity, grade, composition, style or model;

Falsely represents that the services are of particular standard, quality

or grade;

Falsely represents any rebuilt, second hand, renovated, or old goods

as new goods;
 1 2 3
Represents that the goods Represents that the seller or Make a false or misleading
or services have the supplier has sponsorship representation concerning
sponsorship, approval, or approval or affiliation the needs for , or the
performance, characteristic, which such seller or supplier usefulness of, any goods or
accessories, uses or benefits does not have; services;
which such goods or
services do not have;
Gives to the public
Materially
any warranty or
misleading the
guarantee of the
public concerning
performance or
the price at which a
length of life of a
product or like
product or of any
products or goods or
goods that is not
services, have been
based on an
or are ordinarily sold
adequate or proper
or provided.
test thereof.

A price that is stated

in any
False offer of bargain advertisement to be
price: a bargain price by
reference to
ordinary price or
otherwise
A price that a person who reads, hears or sees the advertisement
would reasonably understand to be a bargain price having regard to
the prices at which like products

Schemes offering gifts or prizes

Offering gifts or prizes or other items with the intention of not

providing them and conducting promotional contests.

Creating an impression that something is being given free of charge

when it is fully or partly covered by the amount charged in the
transaction.

Conducting of any contest, lottery or game of chances etc for the

purpose of promoting-directly or indirectly- the sale, use or supply of
any product or any business interest.
RESTRICTIVE TRADE PRACTICES
 Definition

oA trade practice which tends to bring

about manipulation of price, or its
conditions of delivery or to affect flow of
supplies in the market relating to goods or
services in such a manner as to impose on
the consumers unjustified costs or
restrictions.
 CONSUMERS NEED PROTECTION AGAINST

1 2 3
Price fixing or output Collusive tendering; Supplying only to
restraint i.e market fixing territorially particular distributors or
delivery/flow of supplies among competing on condition of sale only
to impose unjustified suppliers, depriving within a territory.
costs/restrictions on consumers of free
consumers. choice, fair competition.
Cont.

DELAYING IN SUPPLYING REQUIRING A CONSUMER TO

GOODS/SERVICES LEADING TO BUY/HIRE ANY GOODS OR
RISE IN PRICE. SERVICES AS A PRE-CONDITION
FOR BUYING/HIRING OTHER
GOODS OR SERVICES.
 Jago grahak jago

IT IS THE CONSUMER THE GOVERNMENT HAS IT IS STILL IN ITS THIS CAMPAIGN HELPS
AWARENESS PROGRAM CREATED CHANNELS TO PRIMITIVE STAGE BUT IN SPREADING
CAMPAIGN FROM THE CREATE CONSUMER WILL EMERGE TO BE A AWARENESS AND
MINISTRY OF AWARENESS LIKE PRINT SUCCESSFUL CAMPAIGN. SAVING CONSUMERS
CONSUMER PROGRAM MEDIA ADVERTISEMENT, FROM THE
AFFAIRS, GOVERNMENT AUDIO CAMPAIGNS, EXPLOITATION OF THE
OF INDIA. VIDEO CAMPAIGNS. SELLERS
Red Bull Case
INTRODUCTI
ON
• Red Bull is an energy drink sold
by Red Bull GmbH, an Austrian
company created in 1987.

• Its slogan read “ RED BULL

GIVES YOU WINGS”.
COMPLAINT
• In August 2014, Benjamin
Careathers, a regular consumer of
the fizzy drink claimed that he has
been consuming red bull for 10
years and have yet not got any
wings.

• He actually meant that the drink

neither provides any physical nor
any intellectual development.
 SETTLEMEN
T
• Red bull had to pay 10 dollars to every
consumer who have been taking the
drinks since 2002.

• Red bull also changed its slogan.

• The wings changed to wiiings

(which has no meaning in dictionary).
FAIR AND HANDSOME
AD
The Case
 Mr. Nikhil Jain, a resident of Delhi filed a
complaint on 2012 in the District Consumer
Disputes Redressal Forum of Central Delhi.

 The complaint was about the ‘Fair and

Handsome Cream’, (World’s No.1 Fairness
Cream for Men) being manufactured by Emami.

 The complainant contended that he had used the

product as per directions for use mentioned on
the labeling and packaging of the product, but it
had failed to show any results as claimed.
Complaint
 Nikhil also argued that Emami has been using Mr. Shahrukh Khan, a well-
known actor as its brand ambassador for promotion of the product and it
makes false claims and promises that it provides fairness in just three
weeks.

 Claimed that Emami has adopted an unfair trade practice for the purpose
of promoting the sale , use and supply of the product.
Forum’s Order
 The forum held that the advertisements published make a
misrepresentation to the public at large about the effectiveness of the
product to change the complexion of the skin from dark to wheatish and
from wheatish to fair.

 It, therefore, amounts to an unfair trade practice being adopted to sell its
product. The forum also held Emami guilty of deficiency in service.

 Directed Emami to deposit a sum of Rs. 15 Lakh as punitive damages with

the consumer welfare fund maintained with the State Commission, Delhi.

 Withdraw the advertisements representing that the use of the product will
change the complexion from dark to wheatish or from wheatish to fair.
Consumer Protection Councils

Group 5
 What are consumer protection
councils

What are their objectives

Learning
Objectives How these councils are established

How these councils work

 Section 4 : How the Central Consumer Protection Council
shall be established

Section 5 : Describes the procedure for the meetings of the

Central Council

Section 6 : Enumerates the objects of the Central and the State

Councils

Sections of Section 7 : Tells how the state Council shall be established

the and how the meetings should be organized

Consumer Section 8 : Tells that the objectives of the State Councils are
same as those of the Central Council
Protection
Act, 1986 Section 8A and Section 8B : Establishment and the objects of
District Council
 One basic thought ‘Consumer
need to be Protected’

Objects of
the Councils Another thought is ‘How
he/she can be protected?’
 The Act has provided for constitution of
Consumer Councils:

District Forums
Work
Towards
This State Commissions
Protection

National Commission
 Rights of Consumers which needed to be
Protected by the Councils

1 2 3 4 5 6

Right to Safety Right to Right to choose Right to Right to Right to

Information Represent Redressal Education
 Composition

Meetings of the
Vacancy
Central Central Council
Council

Term
 Members of the councils are selected from
various areas of consumer interest.

Leading members of state-wide organisations

Central Council representing segments of the consumer public.
: Composition

The Consumer Protection Act has authorised

the Central Government to make rules as to
the composition of the Central Council.
 Any member may, by writing under his hand to the Chairman of
the Central Council, resign from the Council.

The vacancies so caused or otherwise, shall be filled from the

Central same category by the Central Government

Council :
Vacancy
Such person shall hold office so long as the member whose
place he fills would have been entitled to hold office, if the
vacancy had not occurred.
Central Council : Term

The term of the council is three years.

 At least one meeting every year

It may meet as and when necessary

Rules Time and place decided by the Chairman

Regarding
Meetings of Informed to every member 10 days in prior
the Central
Council Shall contain statement of business to be transacted thereat

In the absence of Chairman, the Vice- Chairman shall preside

over the meeting

The resolution passed by the Central Council are

recommendatory in nature
01 02
The Power to Establish State After the Amendment Act 2002, the
Councils is with the States. establishment of the State Councils
has become a necessary requirement
under the Act.

State Consumer Protection Councils

State Consumer Protection Councils

Composition Meetings

 Chairman Minister in charge of  At least meet twice a year.

consumer affairs in the State  The council may meet at such tie
Government. and place as the Chairman may
 Other official or non-official think fit.
members representing such  Procedure in regard to the
interest may be prescribed by transaction of its business is
State Government. prescribed by the State
 Same such number not more than Government.
10 nominated by the Central
Government.
 This will provide a forum for promoting and
protecting the rights of consumers at grass root
level.

District
Consumer It is obligatory on the part of State
Protection Government to establish for every district, by
notification, a council to be known as the
Councils District Consumer Protection Council.
 Consist of Collector of the district, who shall
be the Chairman

Composition of
District
Consumer Such number of other official and non-
Protection official members representing such interests
Councils as may be prescribed by the State
Government
Consumer Forums
 District Consumer Disputes
Redressal Forum (District
Forum)

State Consumer Disputes

Three Levels Redressal Commission
of Consumer
Courts
National Consumer Disputes
Redressal Commission
 Composition

Disqualification for appointment

Appointing authority
Constitution
Term of office
of Forums
Vacancy

Terms and conditions of service

Arbitration and
Conciliation
Act,1996 and
Amendment in 2018
 It is accepted that commercial disputes should
be solved through arbitration and not through
judicial system

Regular judicial process is time consuming

Arbitration
background
of the act Normal proceedings is costly in terms of
money and energy

An Arbitration is the reference of a despite

between two parties for determination , after
hearing both sides in a judicial manner.
 Criminal
Divorce
Matters

Limitation of
Non-Payment Restitution of
the Act of admitted
Liability
conjugal
rights

Taxation
 Suitable Areas for Arbitration

CONSTRUCTION SHIPPING AND PATENTS TRADE MARKS AND

PROJECTS TRANSPORT BRANDS

FINANCIAL FOREIGN PARTNERSHIP EMPLOYMENT

SERVICES(BANKING COLLABORATION DISPUTES DISPUTES
AND INSURANCE)
 An arbitrator is
Simply like
basically a
‘panchayat’
private Judge
system in those
appointed with
days to resolve
mutual consent
disputes
of parties
Domestic
Arbitration Most of the time Any dispute
terms for during the
Arbitration will operation phase
be mentioned of any contract
while making the will be referred
contract itself as agreed.
 Disadvantage
Advantages
s
• Quick Decisions • Limited power of Arbitrator
• Minimum Legal technicalities • No issue summons
and formalities
• Examine witnesses
• Flexibility regarding procedures
• Take Evidence
• Arbitrator is usually expert in the
subject matter • Chances of being biased
• Cost of court fees
• Other proceeding expense is
high
Court must refer the matter to
arbitration in some cases

• If a party approaches court despite the • Once the first statement to court is
arbitration agreement, the other party can already made by the opposite party the
raise objection. matter has to continue in the court
• However objection must be raised before • Once the application is made by other
submitting his first statement on the party for referring the matter to
substance of dispute
arbitration
• Judicial authority shall refer the parties to
arbitration. • The arbitrator can continue with
arbitration and even make an arbitral
• As part of proceedings it is mandatory for award.
judicial authority to refer the matter to
arbitration • Matter can be referred to arbitration
even if the appeal is pending.
Formation of Arbitral Tribunal
• The Arbitral tribunal can consist of 1,3,5,7 or any number of persons,
provided that number of arbitrators must be an odd numbers.
• If the parties do not determine the number of arbitrators, it will be
presumed that there is a sole arbitrator

Appointment of Arbitrator
• The parties can agree on a procedure for appointing the arbitrator or arbitrators.
• If they are unable to agree, each party will appoint one arbitrator and the two
appointed arbitrators will appoint the third arbitrator who will act as presiding
arbitrator
• If Arbitrator is not appointed within 30days then they can request Chief Justice
to appoint an arbitrator
Withdrawal of Arbitration

Arbitral proceedings shall be terminated by final arbitration award or by an order

under section32(2)
Arbitral Tribunal shall issue order if termination of arbitral proceedings
Claimant withdraws claim, unless respondent objects to withdrawal and Arbitral
Tribunal recognises a legitimate interest on his part in obtaining final settlement
of dispute
The parties agree on termination of proceedings
Arbitral Tribunal finds that the continuation of proceedings has for any reason
become unnecessary or impossible
Intervention by court in arbitration
proceedings
Arbitration can
Challenge to
Arbitration Act has continue even if
appointment of
over-riding effect other party
Arbitrators
approaches court

Interim measures Court assistance in

Order is appealable
by court taking evidence
Amendment in 2018
• High Court and Supreme Court recognized Arbitral Institutions: Section 11 of the
Act, empowers the High Courts and Supreme Court of India to appoint arbitrators’ in
Ad-hoc arbitration matters.
• Changes to the timelines provided under S.29A: The above said 2015 Act brought in
one year time line for completion of arbitration proceedings and pronouncement of
awards from the date of constitution of the Arbitral tribunal
• Reduced Scope of Section 17: As per the present Act, a party can approach the
arbitrator any time during the proceedings or at any time after making the award till
it is enforced. The said powers are to be restricted to the date of making the award
and arbitrators will not have powers after making award to grant any interim relief.
Amendment in 2018(Cont.)
• Confidentiality of the Arbitration Proceedings: Globally one of the main
reasons for parties resorting to arbitration is confidentiality. Hence the
amendment proposes a new Section 42A, ensuring confidentiality of the
arbitration proceedings except award.

• Arbitration Council of India(ACI): The said council is going to be a body

corporate headed by a retired Supreme Court Judge. The council is expected to
create a system for grading/ empaneling of existing Arbitral institutions in India

• Qualifications and Experience of Arbitrator: The said qualifications make 10

years’ experience as a lawyer or a Chartered Accountant or an Engineer or
technocrat or a former Executive.
Conciliation
Conciliation
• Conciliation is an alternative out-of-court dispute
resolution(ADR) instrument.
• Conciliation is a voluntary, flexible, confidential, and interest
based process. The parties seek to reach an amicable dispute
settlement with the assistance of the conciliator, who acts as a
neutral third party.
• Conciliation is a voluntary proceeding, where the parties
involved are free to agree and attempt to resolve their dispute
by conciliation
Major Benefits
• Conciliation ensures party autonomy.
The parties can choose the timing, language, place, structure and content of the conciliation proceedings.

• Conciliation ensures the expertise of the decision maker.

The parties are free to select their conciliator. A conciliator does not have to have a specific professional background. The
parties may base their selection on criteria such as; experience, professional and / or personal expertise, availability,
language and cultural skills. A conciliator should be impartial and independent.

• Conciliation is time and cost efficient.

Due to the informal and flexible nature of conciliation proceedings, they can be conducted in a time and cost-efficient
manner.

• Conciliation ensures confidentiality.

The parties usually agree on confidentiality. Thus, disputes can be settled discretely and business secrets will remain
confidential.
Principles of
Procedure
• Independence and impartiality [Section 67(1)]

• Fairness and justice[Section 67(2)]

• Confidentiality [Section 70]

• Disclosure of the information[Section 70]

• Co-operation of the parties with Conciliator [S. 71]

References

• http://www.legalservicesindia.com/article/725/Principles-&-Procedure-of-conciliat
ion-under-Arbitration-&-Conciliation-Act-1996.html
Thank You
Arbitration and Conciliation
Act, 1996 Case Analysis
 New globe transport is under
transportation and Sharchi Finance
were financing for both automobile
and personal loans

New Globe were in need of a new

Case of New Globe truck for which they approached
Sharachi for financing
Transport
Corporation vs
Magma Shrachi For 5 months they were paying the
Finance Limited on instalment charges and no disputes.
21 February, 2011
After the 5th month the vehicle was
stolen and they lodged a police
complain respectively

They also tried to claim the same in

insurance in and have written the
matter with the complaint to the
insurance company
Case of New Globe Transport Corporation vs Magma
Shrachi Finance Limited on 21 February, 2011

The Insurance company

National Insurance company The Arbitrator who was
has appointed a surveyor appointed has advised the
and requested to submit a petitioner to pay the sum
report based on which the amount in seven days
claim can be allotted

Since the matter was

As the vehicle was not complicated they decided to
traceable Global transport take the issue to court
said they may not pay the submitting the matter under
instalment. arbitration and conciliation
act
Case of An unexpected eviction

Thanh lived with her husband in a rental home.

Suddenly, landlord sent a termination to Thanh to vacate the premises.

Both parties were asked to attempt conciliation, with an interpreter

present to assist Thanh.

Conciliator asked the parties to consider options and suggested some

alternative solutions.

Thanh agreed to vacate in 4 weeks and returned to the hearing room with
their conciliated agreement and made legally binding consent orders.