CONSUMER

PROTECTION
ACT
 INTRODUCTION OF LAW

• LAW means rule made by the authority for the proper

regulation of a community or society or for correct conduct in
life. Law is different from an ACT.
• It is an Act of Parliament, a statute (commonly called a law)
enacted as primary legislation by a national or sub-
national
parliament. It sets out the main which the
objectives legislation intended to achieve.
• Eg; contract act, consumer protection act etc.
 What is Consumer

• Consumer refers to any individuals or households that use

goods and services generated within the economy.
• Consumer is defined as someone who acquires goods or
services for direct use or ownership rather than for resale
or use in production and manufacturing.

For example,
When your father buys apple for you and you consume them,
your father as well as yourself are treated as consumers. The
same thing applies to hiring a taxi to go to your school.
 Consumer Law

• "MODU" or "consumer law" regulates private

law relationships between individual consumers and
the businesses that sell those goods and services.

• IT deal with credit repair, debt repair, product safety, service

and sales contracts, bill collector regulation, pricing, utility
turnoffs, consolidation, personal loans that may lead
to bankruptcy and much more.
 CONCEPT OF CONSUMER
PROTECTION
• Consumer protection means safeguarding the interest and
rights of consumers. 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
 CONSUMER PROTECTION ACT
• The Consumer Protection Act, 1986 was enacted for
better
protection of the interests of consumers.
• The provisions of the Act came into force with effect from 15-
4-87.
• Consumer Protection Act imposes strict liability on a
manufacturer, in case of supply of defective goods by him, and
a service provider, in case of deficiency in rendering of its
services.
 HISTORY OF
CONSUMER
PROTECTION ACT
• The act was passed in Lok Sabha on 9th December,1986 and it
came into force from 1 July 1987. Rajya Sabha passed on
10th December, 1986 and assented by the President of India
on 24th December, 1986 and was published in the Gazette of
India on 26th December, 1986.
 FEATURES OF CONSUMER
PROTECTION ACT
• It applies to all goods, services and unfair trade practices
unless specifically exempted by the Central Government.

• It covers all sectors whether private, public or co-operative.

• It provides for establishment of consumer protection

councils at the central, state and district levels to promote
and protect the rights of consumers and a three tier
quasijudicial machinery to deal with consumer grievances
and disputes.
 OBJECTIVES

• To protect the consumer from abuse.

• To provide a venue for grievance /redress.

• To ensure a better quality of living by improving the quality of

consumer products & services.
 IMPORTANCE OF
CONSUMER
PROTECTION ACT
Importance from Consumer’s Point of view:

• Unorganised Consumers-In developing countries like India,

consumers are not organised.Ther are very few consumer
organistions which are working to protect the interest of
consumers. Consumer protection provides power and rights to
these organsation as these organisations can file a case behalf
of customer.
• Consumer Ignorance-It spreads awareness so that consumer
can know about the various redressal agencies where they can
approach to protect their interests.

• Wide Spread Exploitation of Consumer’s-There is lot of

exploitation of consumers as businessmen use various unfair
trade practices to cheat and exploit consumers.Consumer
protection provides safe guard to consumers from such
exploitation.
Importance from Businessmen’s Point of View:

• Businessman Uses Society’s Resources- Businessmen use the

resources of society. They earned profit by supplying goods
and services to the members of society. They must use these
resources for the benefits of consumers.

• Social Responsbilities-A businessman has social obligations

towards customer. It is responsbility of businessmen to provide
quality goods at reasonable price. Consumer protection guides
businessman to provide social responsibilities.
• Government Intervention-If businessman want to avoid
intervention of govt. then they should not involve in
unfair trade practices. Businessman should voluntarly
involve in the activities which protect the interest of
consumer

• Consumer is the Purpose of Business-The basic

purpose of the business is to create more and more
customers and retain them and businessmen can
create more customers only by satisfying the
customers and protecting the interest of consumers.
 SCOPE OF CONSUMER
PROTECTION ACT
• Requirements to performance, composition, contents, design,
construction, finish, packaging of a consumer product
• Requirements as to kind, class, grade, dimensions, weights,
material
• Requirements as to the methods of sampling, tests and codes
used to check the quality of the products
• Requirements as to precautions in storage, transporting and
packaging
• Requirements that a consumer product be marked with or
accompanied by clear and adequate safety warnings or
instructions, or requirements respecting the form of warning
or instructions
 NEEDS OFCONSUMER
PROTECTION ACT
The necessity of adopting measures to protect the interest of
consumers arises mainly due to the helpless position of the
consumers.

• Social Responsibility-
It is the moral responsibility of the business to serve the
interest of consumers. Keeping in line with this principle, it
is the duty of producers and traders to provide right quality
and quantity of goods at fair prices to the consumers.
• Increasing Awareness-
The consumers are becoming more mature and conscious of
their rights against the malpractices by the business. There
are many consumer organisations and associations who are
making efforts to build consumer awareness

• Consumer Satisfaction-
Father of the Nation Mahatma Gandhi had once given a call to
manufactures and traders to “treat your consumers as god”.
Consumers’ satisfaction is the key to success of business.
Hence, the businessmen should take every step to serve the
interests of consumers by providing them quality goods
and services at reasonable price.
• Survival and Growth of Business-
The business has to serve consumer interests for their own
survival and growth. On account of globalisation and
increased competition, any business organisation which
indulges in malpractices or fails to provide improved
services to their ultimate consumer shall find it difficult to
continue.
• Principle of Trusteeship-
Resources are supplied by the society. They are merely the
trustees of the resources and, therefore, they should use
such resources effectively for the benefit of the society,
which includes the consumers.
 RIGHTS OF CONSUMER

• Right to Safety
• Right to Information
• Right to Choice
• Right to be Heard
• Right to Seek Redressal
• Right to Consumer Education
• Right to Basic Needs
• Right to Healthy Environment
• Right to Safety: To be protected against the marketing of
goods or the provision of services that are hazardous to
health and life.

• Right to Information: To be protected against dishonest or

misleading advertising or labeling and the right to be given
the facts and information needed to make an informed choice.

• Right to Choice: To choose products at competitive prices

with an assurance of satisfactory quality.

• Right to representation: To express consumer interests in the

making and execution of government policies.
 • Right to Seek Redress: To be compensated for
misrepresentation, shoddy goods or unsatisfactory services.

• Right to Consumer Education: To acquire the knowledge

and skills necessary to be an informed customer

• Right to Basic Needs: which guarantee survival, adequate

food, clothing, shelter, health care, education and
sanitation

• Right to health environment: To live and work in an

environment which is neither threatening nor dangerous
and which permits a life of dignity and well-being.
 CONSUMER REPONSBILITY
• Consumer must exercise his right-The consumer must select
the product according to his preferences, he must file a
complaint if he is not satisfied with the quality of product.

• Cautious Consumer-The consumer should not blindly believe

on the words of seller. He must insist on getting full
information on quality,quantity,utility,price etc

• Consumer must be quality-conscious-According to this,

consumer himself stops compromising the quality of product.
While purchasing the goods or services consumer must look
for quality marks such as ISI mark,Agmark,ISO,Wool Mark
etc.
• Insist on cash memo- To file a complaint the consumer needs
the evidence of purchase,and cash memo is the evidence or
proof that consumer has paid for the good or service.

• Filling complaints for the redressal of genuine grievances-

The consumer must file a complaint even for a small loss.This
awareness among consumers will make the sellers more
conscious to supply quality product.
 WAYS AND MEANS
• In India large no. of consumers are illiterate and unaware of
their rights. It has to be a social movement wherein people
of all walks of life have to play their role. Following are
some ways and means of consumer protection followed in
India:

• Self Regulation by Business-Large business houses have

realised that they can prosper and grow for a long period
of time only giving due importance to consumer, attend
the complaints of consumer.

• Government- Govt. of India has framed a set of laws and

legislations to protect the interest of consumers and most
important act framed by Govt. is Consumer Protection
• Business Associations-Various business associations such as
Federation of Indian Chamber of Commerce and
Industry(FICCI)and Confederation of Indian
Industry(CII)have framed a set of code of conducts which
lay down guidelines for dealing with customers.

• Consumer Awareness-Consumer must be well aware about

his rights,responsibilities and relief available to him under
consumer protection act.

• Consumer Organisations-It play an important role in

educating consumers regarding their rights, duties.
 FILING A COMPLAINT
Some Important Terms Defined in Consumer Protection Act
Who is a consumer?
One who buys goods or hire services for some value.
When or under what circumstance the complaints can
be filed?
False by traders and manufacturers
If goods are defective
Within what period the complaint can be
filed?
The complaint must be filed within 3 months of purchase
and if some testing of goods is required then within 5 months.
Where the complaints can be filed?
District Forum- the value of goods and compensation claim
does not exceed Rs.20 lakh.
State Commission- the value of goods or compensation
is
more than 20lakh but does not exceed 1crore.
National Commission-it takes up all cases exceeding
the value of Rs.1crore.
Who is not a consumer?
The person who obtains goods for re-sale.
The person who uses the goods without the approval of
the buyer.
The person who obtain goods, hires or avails of any
services without consideration
 SOME RELIEFS OR REMEDIES TO
CONSUMER
• Removal of defects from the goods.

• Replacement of the goods.

• Refund of price paid.

• Compensation of loss or injury suffered.

• Removal of deficiency in service.

• Stopping the sale of hazardous goods.

 Three tier consumer grievances
machinery under the
Consumer Protection Act,1986
and their Jurisdiction
• District Forum

• State Forum

• National Forum
 DISRICT FORUM

It consists of a president and two other members. The president

can be a retired or working judge of District Court. They are
appointed by state govt.In 1986,it had jurisdiction to entertain
complaints where the value of goods or services does not
exceeds Rs.5,00,000 but now the limit is raised to Rs.20lakh.
The agency sends the goods for testing in lab. If the aggrieved
party is not satisfied by the judgment of district forum then
they can file an appeal in State Commission within 30 days
by depositing 25000 or 50% of penalty amount whichever is
less.
 STATE FORUM
It consists of a president and two other members. The president
must be a retired or working judge of high court. They all are
appointed by state govt.In 1986,it had a jurisdiction to
entertain complaints when the value of goods or services
exceeds Rs.5lakh but now the limit is raised upto
Rs.1crore.The State Commission sends the goods for testing
in lab if required. If the upset party is not satisfied with the
judgment then they can file an appeal in National Commission
within 30 days by depositing Rs.3500 or 50% of penalty
amount whichever is less.
 NATIONAL FORUM

It consists of a president and four members one of whom

shall be women. They are appointed by Central Govt.In
1986,it had jurisdiction to entertain complaints where the
value of goods or services exceeds Rs.20lakh but now
exceeds Rs.1crore.
.The National Commission sends the goods if required. If
aggrieved party is not satisfied with the judgment then
they can file a complaint in Supreme Court within 30
days.
 ROLE OF CONSUMER
ORGANISATION
In India there are about 500 consumer organizations working in
the field of consumer protection. The most popular are:
• Consumer Guidance Society of India(Mumbai),Citizen
Action Group(Mumbai)
• Consumer Education and Research
• Centre(CERC)Ahmedabad
• Common Causes(New Delhi),Consumer Unity and Trust
Society(CUTS).
• These associations are performing following functions:
• Bringing out brochures, journals etc.
• Spreading consumer awareness.
• Collecting data of different products and testing them.
• Filing suits or complaints on behalf of consumers.
• Educating the consumers to help themselves.
• Educating women regarding consumerism.
• Motivating people to ask for quality marks such as ISI mark,
Agmark etc.