Consumer Protection Act, 1996

8/4/2019 Consumer Protection Act, 1996

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Consumer ProtectionConsumer Protection

Act, 1986Act, 1986A studyA study


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BackgroundBackground

Consumer is for the market whatair isConsumer is for the market whatair isfor living. Consumption is the fuel forfor living. Consumption is the fuel forproduction.production.

Considering this, various effortsareConsidering this, various effortsaredone by producers to create demand fordone by producers to create demand forgoodsand services.goodsand services.

Powerfulandattractiveadvertisements,Powerfulandattractiveadvertisements,

packaging, salesmanship etcarepackaging, salesmanship etcarebelieved tobelieved to

create consumer wantsan demandscreate consumer wantsan demands


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Need for consumer ProtectionNeed for consumer Protection

But manya times consumersare cheatedandBut manya times consumersare cheatedand

therefore they need protection.therefore they need protection.

Eighteen years back, UnitedNationsadoptedEighteen years back, UnitedNationsadopted

important guidelines for the protection ofimportant guidelines for the protection ofConsumer Interestsandall countries wereConsumer Interestsandall countries were

expected to follow suit.expected to follow suit.

In India the Consumer Protection Act wasIn India the Consumer Protection Act was

enacted in the year1986asa result ofawideenacted in the year1986asa result ofawide

spread consumer Movement.spread consumer Movement.


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Ifa consumer is offered inferior products, ifIfa consumer is offered inferior products, if

pricesare exorbitant, if drugsare unsafe orpricesare exorbitant, if drugsare unsafe or

worthless, if the consumer is unable to chooseworthless, if the consumer is unable to choose

ona

n informed ba

sis, then his dolla

r isona

n informed ba

sis, then his dolla

r iswasted, his healthand safety may bewasted, his healthand safety may be

threatened, and national interest suffers.threatened, and national interest suffers.

John.F.KennedyJohn.F.Kennedy


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Purpose of the ActPurpose of the Act

Better protectionand promotion of consumerBetter protectionand promotion of consumerrights.rights.

Simple , inexpensiveand speedy justice toSimple , inexpensiveand speedy justice toconsumersagainst defective goods , deficientconsumersagainst defective goods , deficientservicesand unfairand restrictive tradeservicesand unfairand restrictive trade

practices.practices.

QuasiQuasi--judicial Redressalat district, stateandjudicial Redressalat district, stateandNational Level.National Level.


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Rights of the Consumers highlighted by the ActRights of the Consumers highlighted by the Act

The Right to SafetyThe Right to Safety

to be protectedagainst the marketing ofto be protectedagainst the marketing ofgoods whichare hazardous to health or life.goods whichare hazardous to health or life.

The Right to ChooseThe Right to Choose to beassured, wherever possible, access toato beassured, wherever possible, access toavariety of productsand servicesatvariety of productsand servicesatcompetitive prices:and in those industriescompetitive prices:and in those industrieswhere competition is not workableandwhere competition is not workableand

Government regulation is substituted, anGovernment regulation is substituted, anassurance of satisfactory qualityand serviceassurance of satisfactory qualityand serviceat fair prices.at fair prices.


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The Right to InformationThe Right to Information

to be protectedagainst fraudulent, deceitfulto be protectedagainst fraudulent, deceitfulor grossly misleading information, advertising,or grossly misleading information, advertising,labeling, or other practices, and to be given thelabeling, or other practices, and to be given the

facts s/he needs to makean informed choice.facts s/he needs to makean informed choice.

The Right to be HeardThe Right to be Heard

to beassured that consumer interests willto beassured that consumer interests will

receive fulland sympathetic consideration inreceive fulland sympathetic consideration inthe formulation of Government policy, and fairthe formulation of Government policy, and fairand expeditious treatment in itsand expeditious treatment in itsadministrative tribunals.administrative tribunals.


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Right to seek redressalRight to seek redressal--

in case ofa consumer dispute right to voice outin case ofa consumer dispute right to voice out

their complaintand reinforcement ofany oftheir complaintand reinforcement ofany of

theabove mentioned rights.theabove mentioned rights.

Right to be educatedRight to be educated--

Making peopleaware of their rightsMaking peopleaware of their rights


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Who isaConsumer?

Section 2(1)d:Section 2(1)d:

Any person who buys goodsAny person who buys goods fora consideration thatfora consideration that

has been paid or partly paidand partly promised to payhas been paid or partly paidand partly promised to payor underany system of deferred paymentand includesor underany system of deferred paymentand includes

any user of such goods but does not includeapersonany user of such goods but does not includeapersonwho obtains such goods for resale or forany commercialwho obtains such goods for resale or forany commercial

purpose.purpose.

oror

Hires oravails of servicesHires oravails of services fora consideration oranyfora consideration orany

user of such services but does not includeaperson whouser of such services but does not includeaperson whoavails of such services forany commercial purpose.avails of such services forany commercial purpose.


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AnalysisAnalysis

Goodsand services should have been boughtGoodsand services should have been bought

for consideration.for consideration.

Includesa person who uses such goods orIncludesa person who uses such goods or

services for consideration.services for consideration. Used for consumptionand not for resale orUsed for consumptionand not for resale or

commercial use.commercial use.

Can be for selfCan be for self employmentalso.employmentalso.

The person may bean individual, firm,The person may bean individual, firm,company ora consumer organization.company ora consumer organization.


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Goodsand services

Sec2(1)i:Goods means goodsas defined under

the Sale of Goods Act,1930.

Every kind of moveable property other thanactionable claimsand moneyand includes

stocksand shares, growing cropsand things

attached toand forming part of land which

areagreed to be severed before sale or undera

contract of sale.


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Service:-

It means service ofany description madeavailable to

potential users like banking, insurance, transport,processing, supply of electrical or other energy,

boarding or lodging or both, house construction,entertainment, amusement or other purveying of news or

other information.

Service does not include the rendering of service free of

charge or undera contract of personal service


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Advantages under the Consumer

Protection Act

The consumer under this law is not required todeposit court fee, which earlier used to deter theconsumers to approach the Courts. Lawyers are alsonot mandatory and the procedures used are simpleas compared to the normal courts, which helps inquicker redressal of grievances.


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Some examples of consumersSome examples of consumers

A person registering for gas connection.

A patient undergoing operation witha private

hospital

A customer usinga telephone connection.

A student of the institution


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Certain cases relating medical field

Medical negligence means deficiency in service performed by a

medical practitioner including a physician, surgeon, doctor,

nurse etc.

It is the failure on the part of the medical practitioner to

discharge his duty in accordance with medical standards,which are being practiced by any other competent doctor.

However the services rendered by the Government hospitals &

charitable hospitals are exempted from the purview of the

Consumer Protection Act as the services are rendered at such

institutes free of charge.


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Medical Service

Medical Negligence would include amongst other acts theMedical Negligence would include amongst other acts the

followingfollowing

Prescribing the wrong dosage to a patient.Prescribing the wrong dosage to a patient.

Leaving cotton or medical instruments inside the body of aLeaving cotton or medical instruments inside the body of a

patient after a surgery has been performed.patient after a surgery has been performed. failure to give proper instruction while prescribing medicine.failure to give proper instruction while prescribing medicine.

Lack of interest in patients.Lack of interest in patients.

Lack of proper arrangement to meet an emergency. Usage ofLack of proper arrangement to meet an emergency. Usage of

wrong medicines.wrong medicines.

Lack of proper checks to test side effects of various drugs.Lack of proper checks to test side effects of various drugs.

Therefore, a doctor can be termed negligent if his actions are ofTherefore, a doctor can be termed negligent if his actions are of

such a nature as to imply absence of reasonable skill assuch a nature as to imply absence of reasonable skill as

compared to the ordinary level of skill required in thecompared to the ordinary level of skill required in the

profession.profession.


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Education

An educational Institution can also be held liable under the ConsumerProtection Act, 1986. Holding of exams, declarations of results are allservices under the Act & can be looked into by the consumer courts.Consumer courts have also held that it is not within their jurisdiction tolook into whether particular rules in an institutions prospectus areillegal or not.

It is important to note that a University conducting public examinations,announcing results, evaluating answer papers, rechecking markssheets etc, on the application by a student/candidate is not performinga service for hire & there is no question of any service being performedas envisaged under the act. Therefore it may be difficult to maintainany complaint in such cases. Universities are in fact statutory bodies.

Where the student could not get his roll number for which he hadapplied to sit for his exams & as a result of this, he lost a year of hisstudies, the consumer courts have held that it amounted to adeficiency of service.


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Banking Services

The Courts have held it to be adeficiency of servicewhere acheque was wrongly honored

where there was non-refund of amount deposited or wherethere is a deliberate delay in repayment of deposit by the bank

are- valid dishonor of Cheques when the account holder has

sufficient funds, not enchasing a draft issued by another branch,

charging a higher interest rate that what was previouslyagreed upon,

transferring money to another person without the customersdirections

. Where the bank lost a passbook, it is the banks duty toreplace the same

Consumer courts are not allowed to go into the area of pricing ofservices. Consumer courts cannot interfere with the banksdecisions with regard to the sanctioning of credit.


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Telephone

If your telephone is disconnected without giving you

notice,

Disconnection of your second telephone for the non-payment of your bill for the first phone isalsoa

deficiency in service. Delays in shifting your phone toanew location, delays

inattending faults, wrong connection of telephone

cables, delays inallotment of phone connections


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Defectand Deficiency

Defect sec2(1)f:-

It meansany fault, short coming or

imperfection in the quality, potency, purity

stand

ard which is required to be m

aint

ainedunderany law for the time being in force.

Deficiency2(1)g:- It meansany fault, short

coming or imperfection in the quality, nature

and manner of performance which is required

to be maintained.


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Telephone

Delays in shifting your phone to a new location,

delays in attending faults,

wrong connection of telephone cables,

delays in allotment of phone connections,

omission to print a subscribers name in a telephone directory,

these may all be regarded as instances of a deficiency in

service

If your telephone is disconnected without giving younotice.

Disconnection of your second telephone for the non-

payment of your bill for the first phone isalsoadeficiency in service.


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Unfair trade practiceUnfair trade practice

Falsely represents that the goods or servicesFalsely represents that the goods or servicesare ofa particular standard, quality, quantity,are ofa particular standard, quality, quantity,

grade, composition , style or modelgrade, composition , style or model

Falsely represents

any rebuilt, second h

and,F

alsely represents

any rebuilt, second h

and,renovated, reconditioned or old goodsas newrenovated, reconditioned or old goodsas new

goods.goods.

Falsely represents that the goods or servicesFalsely represents that the goods or services

have sponsorship, approval, performance,have sponsorship, approval, performance,

characteristics, accessories, uses or benefitscharacteristics, accessories, uses or benefitswhich such goods or services do not have.which such goods or services do not have.


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Makesa false or misleading representationMakesa false or misleading representation

concerning the need for or the usefulness ofconcerning the need for or the usefulness of

any goods or services.any goods or services.

Gives to the publicany w

arranty or gu

aranteeGives to the public

any w

arranty or gu

aranteeof the performance, efficiency, length of life ofof the performance, efficiency, length of life of

aproduct that is not based onadequate testaproduct that is not based onadequate test

thereof.thereof.


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RestrictiveRestrictive trade practicetrade practice

Restrictive trade practice meansa trade practice whichRestrictive trade practice meansa trade practice which

tends to bringabout manipulation of price, or itstends to bringabout manipulation of price, or itsconditions of delivery or to effect flow of supplies in theconditions of delivery or to effect flow of supplies in the

market relating to goodsand services in suchamannermarket relating to goodsand services in suchamanner

soa

s to impose unjustified costsa

nd includessoa

s to impose unjustified costsa

nd includes

Delay beyonda periodagreed to by the trader which isDelay beyonda periodagreed to by the trader which is

likely to lead to rise in priceslikely to lead to rise in prices

Any trade practice which requiresa consumer to buy,Any trade practice which requiresa consumer to buy,hire oravail ofany goods or servicesasa conditionhire oravail ofany goods or servicesasa condition

precedent to hiring, buying oravailing of such serviceprecedent to hiring, buying oravailing of such service


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ManufacturerManufacturer

Sec2(1)j Manufacturer meansany person who-

Makes or manufacturesany goods or parts

thereof or

Does not make or manufacture butassemblesparts thereof or

Puts or causes to put his own mark onany

goods made or manufactured byany other

manufacturer.


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Trader

Sec2(1)q

Trader in relation toany goods meansa

person who sells or distributesany goods for

sa

leand includes the m

anuf

acturer thereof,

and where such goods or distributed in

package form, includes the packer thereof

A middlemen bringing the buyerand the seller

togetherand receivingany commission is nota

trader.


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Complainant

MeansMeans

A consumer orA consumer or

Any voluntary consumerassociation registeredAny voluntary consumerassociation registered

underany law.underany law. The Central government or the stateThe Central government or the state

government which makesa complaint.government which makesa complaint.

One or more consumers where thereareOne or more consumers where thereare

numerous consumers having the s

ame interest.numerous consumers h

aving the s

ame interest.

In case of the death ofa consumer, his legalIn case of the death ofa consumer, his legal

heir or representationheir or representation


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What can we be complainingabout

Any unfair or restrictive trade practice.

Any defect in the goods or deficiency in

service.

Any price that has been charged in excess of:-1. Fixed by the law.

2. Displayed on the goods.

3. Displayed on the price list.

4. Price that has beenagreed between them. Goods whichare hazardous to lifeand safety

are being offered for sale.


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What justice can one get from the

consumer courts

Removal of defects from the goods

Replacement of the goods.

Refund of the price paid.

Award of compensation for the loss or injurysuffered.

Discontinuance of unfairand restrictive trade

practices.

Withdrawal of hazardous goods from beingoffered for sale

To issue correctiveadvertisement.


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Consumer Protection Council

They have been established to protect the

interests of the consumers.

Classes of Councils:-

The Central consumer Protection Council

The State Consumer Protection Council The District Consumer Protection Council.


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Central Consumer Protection Council

Central Consumer Protection CouncilCentral Consumer Protection Council

ChairmanChairman

(Minister in Charge of(Minister in Charge ofConsumer Affairs)Consumer Affairs)

Officialand non officialOfficialand non official

members not more thanmembers not more than

150150


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Consumer Disputes

redressalagencies

Theyare basically consumer courts to settle

consumer Disputes.

Theyarea three tier system comprising of:-

1. Consumer disputes redressal forum Districtforum

2. Consumer disputes redressal commission-

state commission. [SCDRC]

3.Na

tional consumer disputes redress

alcommission National commission [NCDRC]


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Where to filea complaint

Complaint can be filedat the district forum

where the cause ofaction hasarisen or where

the branch office of the opposite party is

located.

Jurisdiction of the Consumer courts:-

Value of the goods/services/compensation is

Upto 20 lacs District forum

20 ---1 crore St a

te Commission Above 1 crore National commission


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Procedure on receiving complaint

On receiving the complaint in the written form, the

forum will refer the complaint to the opposite party

within 30 days of making the complaint.

Then opposite party will be asked to defend the casewithin 30 days in case it wants to deny or dispute its

allegations.

In case the defect in the good cannot be determined

without testing. The goods are sent to the

appropriate laboratory for testing.

The laboratory shall come up within its finding

within 45 days

The complainant shall have a deposit a fees for the

purpose of testing.


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On the basis of the findings of the lab test the

District forum shall make its remarks.

In caseany of the parties want to dispute the

findings of the la

b test they ca

n refute theclaims of the same in writing.

The forum will givea reasonable opportunity

of being heardand shallaward justice.


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In case of services

On receipt of complainta copy of the

same is forwarded to the opposite party

directing them to give their version of

the case. On the basis of evidence given by the

complainantand the opposite party the

forum willaward justice.

Any default in complying with the order

of the district will Invite penalty.


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Practice and ProceduresPractice and Procedures

First understandare youa consumer?

Do you know your rights?

Your responsibilities?

Let the seller beware Caveat Venditor

Purchase goods froma reliable shop. Always purchase standard goods with quality marks

patented by the govt. suchas I.SI, WOOLMARK, AGMARK

Dont buy cheap goods-cheapalways weeps but dear

weeps only once.

Always take cash memo or receipt

The Guarantee card


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Be watchful of the fine print.

Contract trader before taking action.

Notice of complaint

Filing of complaint. Drafting of complaint

Written statement

Consumer Protection Act, 1996

Documents

Transcript of Consumer Protection Act, 1996