Consumer Protection Act

Name of Team Members Name

Roll Call

Akhilesh Kumar

1

Munish Kumar Bakshi

3

Mukesh Cheeta

7

Balasaheb Deshmukh

9

Nawab Abdullah Fakih

11

Sekhar Ghagas

13

Dharmesh Gohel

15

Mahaveer P. Gupta

17

Yogesh Jain

19

Index Chapter No 1

Particular

Page No.

Introduction

2

1.1

Basic Need for the Consumer Protection Act

2

1.2

Objectives & purpose of the Act

5

1.3

Changing phases & Evolution

5

2

Important definitions

7

3

Right of Consumer

9

4

Dispute Settlement Three tier Mechanism

21

5 6 7

Government initiatives for protection of consumer rights Case Studies Conclusion

28 33 38

7.1.

Issues to be addressed

38

7.2

Future prospects of consumer movement in India

39

7.3

Suggestions and Opinions

40

Annexure i

Bibliography & Source of Information

42

1

CHAPTER - 1 1.

Introduction

Aim of Consumer Protection Act (CPA) is to address the grievances of the consumers and protecting them from the unethical practices/ behavior or unfair trade practices of the manufacturer/ supplier.

Earlier though there were several legislations to protect the consumer, but the same never proved adequate to protect consumer and compensate them for their compliances.

CPA become statutory umbrella which made the consumer feel like a king. CPA not only enhances the awareness and educate the consumer but also provide compensation to them by summary and inexpensive proceedings. This keeps manufacturer and the trader alert, creative and innovative.

In the era of free competition, market has become very dynamic and margins have squeezes out. These gave rise to adopt other means/unfair means or practices in execution

of

transactions,

which

resulted

into

increased

grievances at consumer front. Hence, the need for the CPA has become more relevant than the past, where monopoly was the key factor.

1.1

Basic Need for the Consumer Protection Act

Today Consumer rights are an integral part of our lives like the consumerist way of life. We have all made use of them at some point in our daily lives. Market resources and influences are growing by the day and so is the awareness of ones consumer rights. These rights are well defined and there are agencies like the 2

Government,

consumer

courts

and

voluntary

organizations

that

work

towards safeguarding. If these rights are well defined then the basic question is why at all the has

consumer

needs

to

followed by

be

protection?,

it

the

manufacturers/suppliers. So let us look at few reasons because of which consumer needs protection 1. Illiteracy and Ignorance: Consumers in India are mostly illiterate and ignorant. They do not understand their rights. A system is required to protect them from unscrupulous businessmen. 2. Unorganized Consumers: In India consumers are widely dispersed and are not united. They are at the mercy of businessmen. On the other hand, producers and traders are organized and powerful. 3. Spurious Goods: There is increasing supply of duplicate products. It is very difficult for an ordinary consumer to distinguish between a genuine product and its imitation. It is necessary to protect consumers from such exploitation by ensuring compliance with prescribed norms of quality and safety. 4. Deceptive Advertising: Some businessmen give misleading information about quality,

safety

Consumers are

andutility

of

products.

misled

by

false

advertisement

and do not know the real quality of advertised goods. A mechanism is needed to prevent misleading advertisements. 5. Malpractices of Businessmen: Fraudulent, unethical and monopolistic trade practices on the part of businessmen lead to exploitation of consumers. Consumers often get defective, inferior and substandard goods and poor service. Certain measures are required to protect the consumers against such malpractices. 6. Freedom of Enterprise: Businessmen must ensure satisfaction of consumers. In the long run, survival and growth of business is not possible without the support and goodwill of consumers. If business does not protect consumers' interests, Government intervention and regulatory measures will grow to curb

unfair trade practices.

3

7. Legitimacy for Existence: Business exists to satisfy the needs and desires of consumers. Goods are produced with the purpose of selling them. Goods will, in the long run, sell only when they meet the needs of consumers. 8. Trusteeship: Businessmen are trustees of the society's wealth. Therefore, they should use this wealth for the benefit of people.

While we like to know about our rights and make full use of them, consumer responsibility is an area which is still not demarcated and it is hard to spell out that all the responsibilities that a consumer is supposed to shoulder.

1.2

Objectives & purpose of the Act

The basic objective/purpose of this Act is to provide for better protection of the interest of the consumers and for that purpose to make provisions for the establishment of consumer councils and other authorities for the settlement of consumer’s

dispute

and

for matters

connected

therewith.

Hence, the basic objective is to PROTECT and not to provide a loophole and excuses to well organized traders, producers and big business houses and

manufactures

regarding

their

on technical

rights

and

grounds.

Educating

the

consumer

to propagate awareness about the Act and the

ethical practices/means was the other purpose of the act.

1.3

Changing phases & Evolution

In the early years when welfare legislatures like the consumer protection Act did not exist, the maxim Caveat emptor (let the buyer beware) governed the market deals.

4

British regime: During

the

British

regime

(1765-1947),

also

known

as

the

‘Colonial

Era’, Government’s economic polices in India were concerned more with protecting and promoting the British interests than with advancing the welfare

of

the

native population.

The

administration’s

primary

per-

occupation was with maintaining law and order, tax collection and defense. Accordingly much of the legalization enacted during the British regime was primarily aimed at serving the colonial rulers intend of the natives. There were, however, some pieces of legislation which protected the overall public interest through not necessarily the consumer interest. Prominent among these were: the Indian Penal code, 1860, the sale of Goods act, 1930, the dangerous drugs act, 1930 and the drugs and cosmetics act, 1940. In a sense, the sale of good act, and the principles of the law of torts were more for the protection of the trader than the consumer.

The Post-Independence Scenario: Growing

urbanization

due

to

heavy

industrialization

resulted

in

proliferation of human needs-of basic necessaries and also of luxuries. Due to the shortage of certain necessaries and even their non-availability at reasonable necessary quality,

rates to

with growing

empower

supply,

and

menace

the Government

of

adulteration, to

control

it

their

was

found

production,

distribution. Therefore the decade of 1950s, right from

the very beginning, saw the enactment of a number of laws to safeguard the interests of the consumers from various angles. The enactment of the Banking Companies Act,1949 (later called The Banking Regulation Act) to amend and consolidate the Law related to banking

matters

Regulation)Act,1951

as well to

as

implement

the

Industries(Development

and

the Industrial Policy Resolution of 1948

were among the earliest stapes taken by the National Government in India in the direction of consumer protection. As a result of this change in scenario business has now come to be substantially

regulated by Government and Authorities in favour of consumers.

5

In spite of various provisions providing protection to the consumer and providing for stringent action against adulterated and substandard articles in the different enactments like Criminal Procedure Code, 1908, Indian Contract Act, 1972, Sales of Goods Act, 1930, Indian Penal Code 1860, Standard of Weights and Measures Act, 1976 and Motor Vehicle Act, 1988, very little could be achieved in the area of consumer protection. In order to provide for better protection of the interest of the consumers the Consumer Protection Bill, 1986 was introduced in the Lok Sabha on December 5th 1986. The CPA 1986 was enacted to provide for better protection of the interest of consumer and for the purpose to make provisions for establishment of Consumers Councils and other authorities for settlement of consumer’s dispute and for matters connected therewith. The CPA is only one of the several Laws framed to protect consumers from unfair and undesirable practices of business community such law became necessary due to growing frustration of consumers with substandard quality of goods, unsatisfactory services and unfair business trade practices.

6

CHAPTER - 2 2.

Definitions

2.1.

“Complainant" means-

(i) A consumer; or (ii) Any voluntary consumer association registered under the Companies Act, 1956 (1 of 1956) or under any other law for the time being in force; or (iii) The Central Government or any State Government; (IV) One or more consumers, where there are numerous consumers having the same interest;] Who or which makes a complaint;

2.2.

“Complaint" means any allegation in writing made by a complainant

that(i) An unfair trade practice or a restrictive trade practice has been adopted by any trader; (ii) 'The goods bought by him or agreed to be bought by him suffer from one or more defects; (iii) 'The services hired or availed of or agreed to be hired or availed of by him] suffer from deficiency in any respect; (iv) a trader has charged for the goods mentioned in the complaint a price in excess of the price fixed by or under any law for the time being in force or displayed on the goods or any package containing such goods; (v) goods which will be hazardous to life and safety when used, are being offered for sale to the public in contravention of the provisions of any law for the time being in force requiring traders to display information in regard to the contents, manner and effect of use of such goods,

7

2.3.

“Consumer” means any person who-

(i)

Buys any goods for self use or with the approval of self person, but

does not include a person who obtains such goods for resale or for any commercial purpose or (ii)

Hires for avails of any services for self use or when such services are

availed with the approval the first mentioned person.

2.4.

"Consumer dispute"

"Consumer dispute" means a dispute where the person against whom a complaint has been made, denies or disputes the allegations contained in the complaint;

2.5.

"Trader"

"Trader" in relation to any goods means a person who sells or distributes any goods for sale and includes the manufacturer thereof, and where such goods are sold or distributed in package form, includes the packer thereof;

8

CHAPTER- 3 3.

Rights of Consumer

International Consumer Rights: Webster's dictionary defines consumerism as "a movement for the protection of the consumer

against

defective

products,

misleading

advertising,

etc."

Limited consumer protection was present until the 1950s and early 1960s. In the 1950s, a significant breakthrough occurred with the establishment of the product-liability concept,

whereby

a

plaintiff

did

not

have

to

prove

negligence but only had to prove that a defective product caused an injury. In his 1962 speech to Congress, President John F. Kennedy outlined four basic consumer rights, which later became known as the Consumer Bill of Rights. Later, in 1985, the United Nations endorsed Kennedy's Consumer Bill of Rights and expanded it to cover eight consumer rights. Consumer protection can only survive in highly industrialized countries because of the resources needed to finance consumer interests. There are two hundred and sixty consumer organizations in over one hundred countries around the world strives to promote a fairer society through defending the marginalised,

rights

of

all

consumers,

including

the

poor

and

the

by supporting and strengthening member organisations and the

consumer movement in general; campaigning for consumer rights' to be placed at the heart of policymaking

to

encourage sustainable

development.

There

are

eight

key

international consumer rights as defined by the United Nations Guideline for Consumer Protection 1985. They can be simplified into the following: — The right to access to basic needs — To safety

9

— To information — To choice — To representation — To consumer education — To redress — Healthy environment In India to safeguard consumer interest, following rights were envisioned.

Right to Safety Right to Information Right to Choice Right to be Heard The Right to Redress The right to consumer education The Right to Basic Needs and The right to a healthy and sustained environment.

1. Right to Basic Needs Access to food, water and shelter are the basis of any consumer's life. Without these fundamental amenities, life cannot exist. In September 2001, India's stock of food grains were around 60 million tonnes, yet one third of the Indian population lives below the poverty line and consumers often go hungry or remain severely malnourished, leading to poor health. The recent starvation deaths in Orissa are a case in point. A very crucial objective of the conceptualization and existence of consumer rights is to ensure that consumers have an assured food supply, safe and permanent dwellings, and basic amenities of life like sanitation and potable water, and power supply.

10

Urbanizations is seen as a mark of development but for rural migrant population, living conditions in cities is very poor. The population of cities is growing rapidly in India and after 1988, the percentage of urban poor has been more than that of the rural poor. Around 20 to 25 per cent of the urban households live in slums, make-shift colonies or refugee settlements due to non-availability of affordable and decent habitat in urban areas. . According to some estimates, in urban areas alone, there is a housing shortage of 17 million units. This has led to a habitat crisis in Indian cities. In rural India, the situation is equally bad, with a large part of the population still living in make-shift dwellings and hutment. With nonpermanent housing comes lack of sanitation facilities and other amenities like running water and electricity supply. Due to burgeoning population, most people do not have access to dry toilets in rural and urban areas.

2. Right to Safe Environment For urban consumers, environment means parks, gardens, and deteriorating air and water quality. Most urban areas are bereft of any wildlife and people are unaware of the biodiversity around them. On the other hand, rural consumers rely on their environment for fulfillment of their basic needs. The need for environmental conservation is seen as a necessary defence against deteriorating quality of life world-wide. We are all victims of contaminated food and water supply, pesticide-ridden food, adulterated milk and choking exhaust fumes emitting from vehicles. According to a World Bank report, India is being pushed back due to its high environmental costs. We lose around Rs 24,500 crores every year in terms of air and water pollution alone. If you live in a city, you must have experienced air and water pollution at some point of time. Children often fall ill due to polluted environments, it leads to increased health costs and discomfort for consumers. Valuable resources and man-days are lost due to polluted

11

environment and living conditions. Consumers need to understand that only a safe environment can ensure the fulfilment of their consumer rights. International Standards for Safeguarding Right to Safe Environment Consumers International (a nodal agency of consumer organisations from all over the world) has made certain guidelines for ensuring consumers' right to safe environment.

Consumers should be protected from environmental pollution by: 1. Promoting the use of products which are environmentally sustainable. 2. Encouraging recycling 3. Requiring environmentally dangerous products to carry appropriate warnings and instructions for safe use and disposal. Promote the use of non-toxic products by: 1. Raising consumer awareness of alternatives to toxic products 2. Establishing procedures to ensure that products banned overseas do not enter national markets. 3. Ensure that the social impacts of pollution are minimized. 4. Promote ethical, socially and environmentally responsible practices by producers and suppliers of goods and services.

Rural consumers are invariably closer to their environment than urban consumers. Their livelihoods and way of life depend on the environment around them. Their firewood and sources of energy come from trees, manure for fields comes from livestock, water is procured either from underground water supply or from rivers, the crops heavily depend on annual rainfall, even pesticides for safeguarding of crops and storage also come from trees like neem. In short, the rural life revolves around

natural

resources.

For

them, this dependence on the environment is complete and they have a stake in its preservation, whether it is for building their houses, fodder for their cattle etc.

12

3. Right to Safety Consumer right to safety is as vast in its purview as the market reach itself. It applies to all possible consumption patterns and to all goods and services. In the context of the new market economy and rapid technological advances affecting the market, the right to safety has become a pre-requisite quality in all products and services. For e.g. some Indian products carry the ISI mark, which is a symbol of satisfactory quality of a product? Similarly, the FPO and AGMARK symbolise standard quality of food products. The market has for long made consumers believe that by consuming packaged food or mineral water, consumers can safeguard their health. This notion has been proved wrong time and again due to rampant food adulteration in market products. Right to food safety is an important consumer right since it directly affects the health and quality of life of consumers. Earlier, the interpretation of the right to safety was limited to electronic products and other such products. Now, its definition has expanded a lot to include safety aspects of new technologies like GM food, food labeling, chemical ingredients in food products etc. In today's scenario of globalisation, consumers have no control over where the products or commodities they use, come from. For instance, the chocolates or syrups we consume, may be manufactured in countries as far as the U.S. or Australia. Consumers in India would have no control over or knowledge of the manufacturing practices of those countries and will have to rely completely on import regulations of the Indian government and food labelling. This makes the consumer right to safety a very important and critical issue for consumers.

Safety of natural food products is also a problem of growing concern since due to increased contaminated

chemical

inputs

in

farms,

our

food

supply

is

being

with pesticides and chemicals. This poses a grave danger to

consumer health. For non- vegetarians, the problem is even more serious since food animals are being fed

13

anti-biotics to fight diseases among animals and boost their growth. This can have serious repercussions on consumer health.

4. Right to Information Right to information means the right to be given the facts needed to make an informed choice or decision about factors like quality, quantity, potency, purity standards and price of product or service. The right to information now goes beyond avoiding deception and protection against misleading advertising, improper labelling and other practices. For e.g. when you buy a product or utilise a service, you should be informed about a) how to consume a product b) the adverse health effects of its consumption c) Whether the ingredients used are environment- friendly or not etc . Due to the ever increasing influence of the market and the ever changing scene with price wars and hard-sell techniques, the consumer's right to information becomes even more important. The right to information means much more than simple disclosure of the product's weight or price. A consumer has the right to know how the product has been prepared, whether it has been tested or animals or not, if environmentally-sound techniques and resources have been used in its production processes, what kinds of chemicals are used into its manufacturing and what could be their impact on consumer health. Clearly, a consumer has to consider a lot of factors before s/he buys a product. Ideally, a consumer should have knowledge of the entire ‘cradle to grave' journey of the product to determine whether its safe and beneficial for use or no. The ‘cradle to grave journey' refers to the processes a product goes through- from the time of it being made out of raw material, the processes of its moulding into its final shape, transportation, labour, ingredients used, to the form in which it ends

14

up on market shelves. It is only when a consumer is aware of the history of the product that he can make informed choices.

An example of this is the GM food controversy. GM food is promoted as the answer to world's hunger and malnutrition but its safety for consumers and the environment is yet to be proved. Despite strong lobbying by pro-GM groups and the market, consumers in Europe have campaigned effectively against the entry of GM food into their food chain and markets. There are information and publicity campaigns that have made consumers rally behind a common consumer stand against GM food. As a result, the governments and the European Union have placed strict restrictions on the trial uses of GM technology in the market or in agriculture. Recently, it has come to light that most cosmetics like lipsticks, kajal and mascara are tested on animals in laboratories to see whether they have any adverse effects on them or no. There was also a controversy about how Nike shoe company was using sweat labour in South Asian countries, paying its workers abysmally low wages for manufacturing shoes. Similarly, there was a ‘McLibel' case against McDonald's alleging that Mc Donald's generated a lot lot of unwanted waste due to its excessive packaging and harmed the environment.

The

advertising

techniques

of

many

products,

directly

targeting

and

featuring children have also been questioned. Many parents don't even know that their children are being targeted by market surveyors to determine their consumption habits by collecting data through surveys, interviews and by offering free samples of products. It

is

not

just

the

consumers

who

use

information

gathering

or

disseminating techniques and tools to protect their consumer rights. Information dissemination is also used very extensively by advertisers and the market to get their message across to the consumer. Tools and agencies of information like newspapers, print

15

media, television and the Internet are utilised by marketing of consumer products and services. This has made advertising a multi-million dollar industry in India and also world-wide.

5. Right to Redress Competition

is

manufacturers are consumers.

the

by-product

discovering

of

newer

the ways

market of

economy.

cheating

Everyday,

and

duping

Unscrupulous market practices are finding their way into

consumer homes, violating consumer rights and jeopardising their safety. It is to protect consumer interests that consumers have been given the right to obtain redress. In India, we have a redress machinery called Consumer Courts constituted under the Consumer Protection Act (1986), functioning at national state and district levels. But it has not been made complete use of under due to lack of awareness of basic consumer rights among consumers themselves. While in the developed world, right to redress is perhaps the most commonly exercised consumer right, in developing countries, consumers are still wary of getting involved in legal redress system. There are consumer courts in India where any consumer can lodge a case if s/he thinks he or she has been cheated. The details of how to lodge a complaint have been explained elsewhere in the manual.

6. Right to Consumer Education Consumer education empowers consumers to exercise their consumer rights. It is perhaps the single most powerful tool that can take consumers from their present disadvantageous position to one of strength in the marketplace. Consumer education is dynamic, participatory and is mostly acquired by

hands-on and

16

practical experience. For instance, a woman who makes purchase decisions for the household and does the actual buying in the marketplace would be more educated about market conditions and ‘best buys' than a person who educates himself about the market with the help of newspapers or television. Also, today, it is not just the market or products that a consumer needs to educate him about but s/he also needs to know about company profile, government policies and introduction of new technology. Market influences have grown so much that, not just wholesale and retail sellers but even medical practitioners are falling prey to their pressures. The pharmaceutical industry is one such example. India, with its 1 billion population and largely uneducated consumers, is a very lucrative market for this industry. The boost

its

pharmaceutical

industry,

sales,

free

offers

to

samples

of

medicines, freebies, and even free luxury holidays to physicians to influence them to use their brands and give them preference over other brand names. There have been many instances when drugs banned in countries like US, have been prescribed to Indian consumers and are readily available as over-thecounter drugs. It is a sad example of gross violation of consumer trust by medical practitioners. This situation is rampant not just in rural areas but also among educated urban consumers. The reason why the market, in connivance

with physicians, is able to exploit consumers is that Indian

consumers are not aware of the themselves

abreast

with

prevailing

situation

and

do

not

keep

latest developments taking place around them.

Consumer education can play a crucial role in protecting consumers against such dangers. In the Indian context, sustainability and traditional knowledge can play a vital role in empowering consumers but consumers are unable to connect to their knowledge base. Consumer and

education

can

rejoin the broken link

make traditional knowledge accessible to consumers again. Some

sources of consumer education

are

past

experiences

of

consumers,

information dissemination by

17

government agencies and NGOs, classroom teaching by teachers and informal lessons by parents.

18

19

CHAPTER-4 4.

Dispute Settlement Three tier Mechanism

The Consumer Production Act provides for a three tier system of redressal agencies: (1) District level known as District Forum, (2) State level known as 'State Commission', and (3) National level known as 'National Commission'. A complaint is to be made to the district forum of the concerned district where the value of goods and services and compensation, if any, is up to Rs 20 lakhs. A complaint is to be made to the 'State Commission' between Rs 20 lakhs and Rs 100 lakhs. A complaint is to be made to the National Commission for more than Rs 100 lakhs. Interestingly, there is provision for appeals against the orders of a particular redessal forum by the aggrieved party before the next higher echelon and even from the findings of the National Commission before the Supreme Court.

CONSUMER DISPUTES REDRESSAL AGENCIES

1)

District Forum

Composition of the District Forum. — 1. Each District Forum shall consist of,— (a) President: a person who is, or has been, or is qualified to be a District Judge, who shall be its President; (b) Member: two other members, one of whom shall be a woman, who shall have the following qualifications, namely:— 21

(i)

be not less than thirty-five years of age,

(ii) Possess a bachelor's degree from a recognized university, (iii) be persons of ability, integrity and standing, and have adequate knowledge and experience of at least ten years in dealing with problems relating to economics, accountancy,

industry,

law,

commerce,

public

affairs or

administration: Every appointment under sub-section (I) shall be made by the State Government on the recommendation of a selection committee consisting of the following, namely:— (i) The President of the State Commission

— Chairman.

(ii) Secretary, Law Department of the State

— Member.

(iii) Secretary in charge of the Department dealing with Consumer affairs in the State

— Member.

2. Every member of the District Forum shall hold office for a term of five years or up to the age of sixty-five years, whichever is earlier: Jurisdiction of the District Forum.— 1. Monetary: District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed ''does not exceed rupees twenty lakhs. 2. Territorial: A complaint shall be instituted in a District Forum within the local limits of whose jurisdiction,— a ) The opposite party or each of the opposite parties ,actually and voluntarily resides b) Any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides,in such cases, either the permission of the District Forum is given or the consent of the opposite party is necessary. c) If the dispute is pending the civil court,the consumer forum has no jurisdiction to entertain the same.

22

3)

Manner in which complaint shall be made.—

(1) A complaint in relation to any goods sold or delivered or agreed to be sold or delivered or any service provided or agreed to be provided may be filed with a District Forum by – (a) the consumer, (b) any recognized consumer association whether the consumer is a member of such association or not; (c) one or more consumers, where there are numerous consumers having the same interest, with the permission of the District Forum (d) The Central Government or the State Government as a representative of interests of the consumers in general. A complaint has been admitted by the District Forum, it shall not be transferred to any other court or tribunal or any authority set up by or under any other law for the time being in force. 4)

Procedure on admission of complaint. —

(1) The District Forum shall, on admission of a complaint, if it relates to any goods,— (a) Refer a copy of the admitted complaint, within 21 days from the date of its admission to the opposite & such extended period not exceeding fifteen days as may be granted by the District Forum; (b)

5)

Where the opposite party on receipt of a complaint referred to him under clause (a) denies or disputes the allegations contained in the complaint to take any action to represent his case within the time given by the District Forum Powers of District Forum

(a) Summoning & enforcing attendance of defendant or witness & examining the witness on oath. (b) The discovery & production of any document or other material ,object producible as an evidence (c) Receipt of evidence on affidavits 6)

Finding of the District Forum. —

23

(1) Remove the defect pointed out by the appropriate laboratory from the goods; or (2) To replace the goods with new goods of similar description which shall be free from any defect; or (3) (3) To return to the complainant the price, or, as the case may be, the charges paid by the complainant; or (4) To remove the defects in goods or deficiencies in the services in (5) question; or (6) To discontinue the unfair trade practice or the restrictive trade practice or not to repeat it;

2.

State Commission

Composition of the State Commission. — (1) Each State Commission shall consist of— (a) President: A person who is or has been a Judge of a High Court, appointed by the State Government. (b) Member: Two other members who shall be persons of ability, integrity and standing, and have adequate knowledge and experience of at least ten years in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration: Every

appointment

under

sub-section

(1)

shall

be

made

by

the

State Government on the recommendation of a Selection Committee consisting of the following members, namely:— President of the State Commission

--

Chairman;

Secretary of the Law Department of the State

--Member;

Secretary incharge of the Department dealing with Consumer Affairs in the State

--

Member:

(2) Every member of the State Commission shall hold office for a term of five years or up to the age of sixty-seven years, whichever is earlier:

24

Jurisdiction of the State Commission. — (1) Subject to the other provisions of this Act, the State Commission shall have jurisdiction— (a) Monitory- Original: to entertain complaints where the value of the goods or services and compensation, if any, claimed exceeds rupees twenty lakhs but does not exceed rupees one crore; and (b) Appellate: To entertain appeals against the orders of any District Forum within the State; and (c) Supervisory or Revisional: to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any District Forum within the State.

3.

National Commission

Composition of the National Commission.— (1) The National Commission shall consist of— (a) President : A person who is or has been a Judge of the Supreme Court, to be appointed by the Central Government. (b) Member: Two other members who shall be persons of ability, integrity and standing and have adequate knowledge and experience of at least ten years in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration: Every appointment under this clause shall be made by the Central Government on the

recommendation

of

a

selection

committee

consisting

of

the

following, namely:— (a) A person who is a Judge of the Supreme Court,— Chairman; To be nominated by the Chief Justice of India

25

(b) The Secretary in the Department of Legal Affairs —Member; In the Government of India (c) Secretary of the Department dealing with consumer—Member Affairs in the Government of India Jurisdiction of the National Commission. — Subject to the other provisions of this Act, the National Commission shall have jurisdiction— (a) Monetary: To entertain complaints where, the value of the goods or services and compensation, if any, claimed exceeds rupees one crore; (b) Appellate: To entertain appeals against the orders of any State Commission; (c) Supervisory or Revisional: To call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any State Commission where it appears to the National Commission Appeal. — Any person aggrieved by an order made by the Redressal agency may prefer an appeal against such order to the next higher level of agency within a specified period from the date of the order. Appeal to the State Commission: Any person aggrieved by an order made by the District Forum, may prefer an appeal against such order to the State Commission within a period of 30 days from the date of the order. Appeal to the National Commission: Any person aggrieved by an order made by the State Commission, may prefer an appeal against such order to the National Commission within a period of 30 days from the date of the order. Appeal to the Supreme Court: Any person aggrieved by an order made by the National Commission, may prefer an appeal against such order to the Supreme Court within a period of 30 days from the date of the order. Procedure for hearing the Appeal by National Commission

26

1. Memorandum of Appeal: An appeal memorandum shall be presented by the appellant or his/her agent to the national commission in person or be sent by registered post addressed to the commission. 2. Appeal After Limited Period: In this, the memorandum shall be accompanied by an application supported by an affidavit to satisfy the national commission that he/she had a sufficient cause for not to appeal within a period of limitation. 3.

Appearance of Parties to the Appeals: On the date of hearing, if the party or their

agent

fails

to

appear

on

such

date,

the

national

commission either dismisses the appeal or decide ex parte on merits. 4. Grounds not urged: The appellant shall not urge or be heard in support of any ground of objection not set forth in the memorandum, except by leave of the national commission. 5. Penalty of Orders: Every order of a District forum commission or national commission, if no appeal has been preferred against such order, shall be final. 6. Enforcement of Orders: Every order of a District forum commission or national commission may be enforced as if it were decree or order made by the court. 7. Penalties: Where a trader or a person against whom a complaint is made , or the complainant fails or omits to comply with any order made by redressal agencies , as the case may be, such trader or person or complainant shall be punishable as per the prescribed norms of the agencies .

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CHAPTER- 5 5.

Government initiatives for protection of consumer rights

Steps Undertaken By the Government for Creating Consumer Awareness: Public campaign like Grahak Jago Grahak, Grahak Dost etc. Conduct Street shows, dramas, street plays depicting mock characters. Hold drawing competitions in the schools by giving relevant themes. Make people aware about their rights through hoardings. T.V. advertisements etc.

Publicity though print media using newspaper advertisements Publicity through electronic medium by telecast of video spots Telecast of video spots in north eastern states: Meghdoot postcards Printed literature Exhibition in Indian science congress at shillong Nukkad natak contest on consumer issues National consumer helpline Core centre Participation in India international trade-fair-2008 Participation in MTNL health mela Use of sports events Outdoor publicity Joint publicity campaign Use of internet to generate consumer awareness

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6.

Case Studies

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35

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7.

Conclusion

Consumer protection movement has got a bright future in India. A part from Governmental seriousness in the matter, consumer activism, organizations, civil society and other voluntary associations needs to play their part in the furtherance of consumer movement. In the current scenario media can play a vital role in infusing the consumer behavior and can easily generate opinions or enhance awareness about the possible unfair practices in the market. Above all, the consumers have to be aware of their rights and should assert them selves in the market place.

7.1

Issues to be addressed

Some of the commonly raised problems are: Adulteration of food substances by traders through addition of substances which are injurious to health or removal of substances which are nutritious or by lowering their quality standards Misleading advertisements of goods and services in television, newspapers and magazines to influence the consumers demand for the same Variations in the contents filled in the package of goods Improper delivery of after sales services Supply of defective goods Hidden price component Use of deceptive or incorrect rates on products Use of false or non-standard weights and measures in supply of goods Production of low quality goods in bulk quantities Illegal fixation of Maximum Retail Price (MRP) Selling above the MRP Unauthorized sale of essential products like medicines, etc. beyond their expiry date to ignorant consumers Poor customer services Non-compliance with the terms and conditions of sales and services Supply of false or incomplete information regarding the product Non-fulfillment of guarantee or warrantee etc.

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All such issues and problems must be handled more efficiently both at the Centre and the State level, with a view to protect the interests of the consumers and promote their welfare.

Future Prospects of Consumer Movement in India

7.2. As

a

matter

of

fact,

consumer protagonists functioning

of

in

three India.

major The

problems first

are

problem

confronting concerns

the active

the Consumer Forums throughout the country. Not with

standing the fact that these Forums have now been established, by and large, throughout the country, consumer have been

repeatedlyvoicing

activists and their

organizations

grievances

against

the

smooth functioning of these Forums. They argue that these Forums have also started behaving like Civil Courts and are likely to have mounting arrears soon. In addition, these Forums still lack basic infrastructural facilities. The members sit

only

part-time and 90 days decision-

making requirement is not strictly adhered to. There are also ego and status problems between judicial members and the members with non-judicial background. Another significant problem is that the stay orders from the High Courts have begun to hold up a large number of cases filed before the Consumer Forums, thereby

denying

the

benefits

of

speedy

and

inexpensive redressal machinery promised under the Consumer protection Act, 1986.

The second problem concerns the applicability of the Consumer protection Act, 1986 to various services. As is evident, ever since the implementation of the 1986 Act, whereas there has hardly been any significant case in which the ‘goods’ has been vehemently contested, there is a voluminous amount of case law which involved determination of the meaning, definition, and ambit of the term ‘service’. Section2 (1)(o)of the 1986 Act categorizes certain specific types of services which, inter alia,

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include

banking,

financing,

insurance,

transport,

amusement

and

entertainment. The definition of the term ‘service’ had already been kept very wide and now with the construction’ by

inclusion

of

the

two

terms

‘housing

and

the Consumer Protection (Amendment) Act, 1993, it has been

further widened. Only two types of services have been kept out of the ambit of the 1986 Act. They are services rendered free of charge and services rendered under a contract of personal service. The

non-mentioning

of

services

and telegraphs

and

like

education,

health,

housing,

posts

telecommunications had presumably given these services an impression of their exclusion from the ambit of this legislation. At the initial stages, therefore, these services contested the jurisdiction of the 1986 Act, thereby claiming complete immunity from their governance by it. The Consumer Forums, however, have appreciably stood the test of time and have brought all these services within the ambit of the 1986 Act. Making consumers aware of their rights and taking consumer movement to the rural India is the third and perhaps the most important problem and a challenge before the consumer organizations. As is well known, most consumers are still ignorant of their rights, much less of being assertive about them. Though the Government appears to be serious of this issue, much however depends upon the consumer organizations. They have still to cover a very long distance so far as taking the movement to rural areas is concerned.

7.3.

Suggestions or Opinions

We feel in today's rampant changing market scenario, there is an increasing necessity

to

empowering

the

consumers

through

education

and

motivation regarding their rights and responsibilities. He/she should be equipped to be fully vigilant so as to be able to protect himself/herself from any wrongful act on the part of the seller/trader. Several steps have been taken by the Government, both at the Central and State level towards generating awareness among the consumers.

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Given all such initiatives, it is the responsibility of the consumer as well to keep in mind the following suggestions: Purchase products only after their complete scrutiny and not at the cost of attractive advertisements. Keep check on the weighing and measuring instruments used by traders. Avoid buying fruits and vegetables from unhygienic place. Check print of MRP on the packet. Check the quantity as per the figure printed on the packet. Check the expiry date of the product, particularly that of eatables and medicines. Always collect bill at the time of purchase. Moreover, the packaging and appearance of the product should not be the guiding factor for consumer purchases. Along with cost consideration, consumer must be cautious importantly,

it

is

the

of

the

quality

of

the

product.

Most

prime responsibility of a consumer to bring to the

notice of the concerned authorities, any violation in their rights.

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Bibliography Books: Bulchandani K, 1999, Business law, Himalaya Publications Web sites: Alexander, Richard. "The Development of Consumer Rights in the United States Slowed by the Power of Corporate Political Contributions and Lobbying." 1999. Archived at: http://consumerlawpage.com/article. 1999. http://www.answers.com/topic/consumer-bill-of-rights http:// www.ftc.gov/bcp/menus/resources/guidance/adv. shtm http:// www.consumerrightsexpert.co.uk/ http://www.consumerdirect.gov.uk/ http://www.citizensinformation.ie/ categories/consumer-affairs/consumerprotection/consumer-rights http:// www.consumerdirect.gov.uk/after_you_buy/know-your-rights/ http://www.moneysavingexpert.com/shopping/consumer-rights-refundsexchan http://www.skillsportal.co.za/training/sales/509560.htm http:// www.answers.com/topic/consumerism http://grehluxmi.blo gspot.com/2008/07/ jaggo-grahak-jaggo.html http://al chemistpoonam.wordpress.com/2007/09/16/ consumer-rightsawareness-ii/jaago-grahak-jaago/ http:// fcamin.nic.in/Events/EventDetails.asp?EventId=1740&Section=Consumer %20Information& ParentID=0&Parent=1&check=0 http:// www.legalserviceindia.com/ http:// www.legalhelpindia.com/

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