CHAPTER 5 :CONSUMER PROTECTION

It is said that the consumer is a . . . . . KING!

BUT . . . IS THAT REALLY…

TRUE ???

MANUFACTURERSWith help of

Resort to practices like

CHARGING EXCESSIVELY HIGH !!!

PVR MOVIE TICKETS @  ₹350

POPCORN ₹150 !

SAMSOSA ₹ 50 !??

AQUAFINA ₹ 40 !

SUBSTANDARD GOODS

CARTELS

HOARDING

And may take advantage of innocent and ignorant consumers

Hence arises the need for

Consumer protection

WHO IS A CONSUMER ?

Any person who consumes or uses any commodity or

service available from natural source or through the

market is known as a consumer. The word ‘consumer’ is

derived from Latin word “consumere” which means ‘to

eat or drink’.

IMPORTANCE OF CONSUMER PROTECTION

1. Ignorance Of ConsumersThe consumers get exploited due to

their ignorance about their rights,

product detail, price etc. The

consumers get cheated because

they lack complete knowledge.

For e.g.: Shopkeepers may even sell

off some expired goods to illiterate

and ignorant customers.

2. Market dominated by sellers : If the market is dominated by the

sellers, then they take all the

decisions which favor them.

The sellers do not give preference

to consumer welfare. Consumer

has to accept the terms as decided

by sellers. The transactions

invariably benefit the sellers,

manufacturers and other

middlemen.

3. Participation of consumers is lacking :

Many decisions directly affecting

consumer’s interest are taken

without their or their organizations’

consent. The decisions taken by the

association of sellers or traders are

generally one sided where the

consequences of the decision on

the consumers are not considered

at all.

4. Overall Rate Of Consumption has increased : The population as well as an

increase in overall standard of

living of people has resulted in

increase in consumption. To satisfy

huge demand, it is necessary for

manufacturers to undertake large

scale production. This has resulted

in increased prices, more variety,

exploitation, unfair trade practices

etc.

5. Required information is not easily available:

In the modern world , the distance between

the consumer and the manufacturer is vast.

It is impossible to get information from

manufacturers directly. The consumer relies

more on advertisements of the products,

other’s experiences or on trial and error

method to decide about the product. As a

result, his chances of getting exploited are

high.

6. Tendency of consumers : It is a normal tendency of consumers

to rush to shopping outlets where

high rate of discount is provided on

goods. Most of the consumers get

attracted to cheap products,

schemes, discounts, sale etc.

However, sellers may sell sub-

standard goods in such cases. As a

result, the consumer may get

exploited and he may not even come

to know about it.

7. Attitude of Consumers One of the biggest reasons of exploitation of consumers is their attitude. Most consumers have a “chalta hain” attitude due to which even if they are exploited, they will not complain or act against it. The sellers therefore take advantage of this situation and continue to exploit the consumer. For e.g.: A consumer may sometime get a tshirt which has a small hole in it but then he may not complain to the seller regarding the same.

8. Nature of Products :

Due to complicated

manufacturing processes and

the technical knowledge

involved, consumers are unable

to judge the quality or safety

aspects of a product. The

producers take advantage of this

situation and try to exploit

consumers.

9. Consumers are unorganized :

Sellers & traders have their own

associations. However,

consumers do not have any

union. They are unorganized

and are not united. Bargaining

power is always with a stronger

group and hence a single

consumer cannot fight an entire

association.

To sum up … What is the importance of consumer protection

Ignorance of Consumers

Market dominated by sellers

Participation of consumers is lacking

Overall rate of consumption has increased

Required information is not easily available

Tendency of consumers

Attitude of consumers

Nature of Products

Consumers are unorganized

Rights of consumers

9 points

Right to Redressal

The right enables a consumer to seek redressal against unfair trade practices or exploitation.

This right assures proper legal recourse to attend to a consumer’s complaint and get it redressed (solved).

PRICE QUALITYPURITY

Right to Information

Right to Information helps consumer in selecting the right product and take more informed decision. It assures safety of the consumer and the product both.

Right to Protect Against Spurious Goods

Companies cannot advertise about cigarettes or liquor

The right protects the consumers against marketing of spurious and hazardous goods which pose a danger to public health and life.

Right to be Heard

Every consumer has the right to file a complaint and be heard about

Right to Protect Against Unfair Trade Practices

This right offers protection to consumers against any kind

of unfair trade practices.

Right to safety

INGREDIENTS

If the product is hazardous in nature then detailed

information should be given about its inherent

danger and safe mode of handling. It should also

contain the consequences that would occur if it is not

used correctly.

Right to choose

Right to Choose enables a

consumer to select a

suitable product from

among the available

variety in the market at a

competitive price.

Right to healthy environment

Right to live in a healthy and pollution free environment in the present as well as in the future.

Right to education

The government, media and NGO’s can play a major role in educating consumer.

To sum up… The Rights of a Consumer

RIGHT TO REDRESSAL

RIGHT TO INFORMATION

RIGHT TO PROTECT AGAINST SPURIOUS GOODS

RIGHT TO BE HEARD

RIGHT TO PROTECTED AGAINST UNFAIR TRADE PRACTICES

RIGHT TO SAFETY

RIGHT TO CHOOSE

RIGHT TO HEALTHY ENVIROMENT

RIGHT TO EDUCATION

In short , RIGHTS CHE

Products & services used are

not produced in an

environment that harms

others

1.Social Concern:

Responsibilities of a consumer

2.ACTIVE/ALERT

A consumer has to be assertive and ensure that he gets a

fair deal.

EG: CHECKING THE EXPIRY DATE BEFORE BUYING

3.Value before buying

(Critical Awareness):

MUMBAI: In a sluggish property market,

British bank Standard Chartered has sold a

sea-facing duplex apartment in the Samudra

Mahal building at Worli in Mumbai for Rs 40

crore.

The deal works out to Rs 1,10,000 per sq ft.

4.Environmental Concern :

The consumer should recognize his individual and collective responsibility to conserve natural resources.

Has to ensure that the goods and services he uses do not harm the environment.

5.UNITY

The consumers should organize themselves and work for the welfare of all consumer.

6.SUSTAINABLE CONSUMPTION

The consumer should consume only as per his requirement. He should ensure that he actually requires a particular product and only then buy it.

Consumer should take care of……………………

Before buying :• Planning in advance• Enquire about past performance of product

or service.• Enquire about part performance of the

product seller or service provider• Go through product reviews in newspaper

and websites

While buying :• Asking for demonstration about how to operate or use the product.

• Enquiring about after sales service and ensuring availability & contact details of service centre.

• Insisting on approved sale bill with all details of product.

• Getting a signed warranty / guarantee card from the dealer and reading the contents therein.

After buying :• Using products as per instructions given in

user manual.• Storing the product as mentioned on the

cover or manual.• Keeping bills and guarantee card safely.• In case of a fault inform the dealer or service

centre.• Seek immediate redressal if there is a

deficiency in product

Ways and means of consumer protection

LOK ADALAT Lok Adalat is referred to as People’s Court.

Mock court held by State Authority, District Authority, Supreme Court Legal Service Committee, High Court Legal Service Committee or Taluka Legal Service Committee.

Established by the government to settle disputes by compromise

Lok Adalat accepts pending cases from regular courts which can be settled by compromise only if 1. Both parties agree to transfer the case to Lok Adalat or2. One party makes an application and the court sees any chance of compromise.

PUBLIC INTEREST LITIGATION

Ways and means of consumer protection

This scheme enables any person in the interest of the public to approach a court of law.

A PIL is not for individual interest but for the benefit of a particular group

Redressal Forums

Ways and means of consumer protection

AWARENESS PROGRAMMES

This awareness is done by journals, newspapers, magazines, advertisements etc.

Besides, various consumer related programmes are telecasted on various radio and TV channels.

The society observes 15th March, World Consumer Rights Day and 24th December, National Consumer Day as consumer awareness days.

Consumer Organisations: The consumer organizations

also help the consumers to fight for their rights through campaigning, lobbying and through protests.

Thus, they strengthen the consumer movement.

CONSUMER WELFARE FUND

This fund is created by Department of Revenues.

It provides monetary assistance to the consumer movement especially in rural areas.

These funds are used for consumer education, guidance, complaint redressal etc.

Legislative Measures

Various acts have been passed by the Govt. of India However, the Consumer Protection Act of 1986 has proved to be a boon for consumers

because under this Act they can file a suit against any manufacturer or seller in case of loss due to fault in their product or service.

Consumer Awareness and Legal Redressal

Three tier quasi-judicial consumer disputes Redressal Machinery• District forum• State commission • National commission

  District Forum State Commission National CommissionMeaning It is a consumer dispute

redressal forum working at district level

It is a consumer dispute redressal forum working at state level

It is a consumer dispute redressal forum working at national level

Established by State Government State Government Central GovernmentComposition President + 2 Members

(Min)President + 2 Members (Min)

President + 4 Members (Min)

Qualification of President

Who is or has been or is qualified to be a District judge.

Who is or has been a judge of a high Court.

Who is or has been a judge of the Supreme Court.

Duration / Tenure

Term of 5 years or upto age of 65 whichever is earlier.

Term of 5 years or upto the age of 67 whichever is earlier.

Term of 5 years or upto the age of 70 years whichever is earlier.

Monetary Jurisdiction

Value of goods or services and the compensation claimed is less than Rs. 20 Lacs.

Value of goods or services and the compensation claimed is more than Rs. 20 Lacs but less than Rs. 1 crore.

Value of goods or services and the compensation claimed is more than Rs. 1 Crore.

Area It covers a particular district

It covers a particular state

It covers the entire country.

Nature of Complaints

Only original complaints can be entertained

Original Cases + Appeals against orders of District Forum + Supervisory / Revisional

Original Cases + Appeals against orders of State Forum + Supervisory / Revisional + Improper jurisdiction

Comparative analysis of District forum, State commission and National commission

Role of NGOs

CONSUMER ORGANIZATIONS ????? Consumer Organisations are voluntary groups of people who work for a cause of

protecting consumers from harmful products, wrongful representation, pollution etc.

Their main objective is to establish consumer rights.

Consumer organizations are a category of NGOs who work for protecting consumers.

The word NGO itself suggests that they are not connected to the government or any political party. NGOs are non-profit organization.

NGOs have their own rules and principles. They do not have any statutory powers. However, they are a strong support group for the consumers.

NGOs also help to create awareness about consumer rights and assist consumers taking legal action against producers or sellers who are much bigger and stronger than individual consumers.

EXAMPLES OF NGOs1. Consumer Unity & Trust society2. Consumer Guidance Society of India3. Mumbai Grahak Panchayat4. Consumer’s Association of India

FUNCTIONS PERFORMED BY NGOs To undertake various programmes

To guide consumers

To represent a consumer

Make suggestions and recommendations

Publish periodicals, bulletins

Testing of consumer products and publishing the results.

Filing in the interest of general public.