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09 Mba Bl Lec Nov 18 Cpa & Unfair Trade Practices  Final
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09 Mba Bl Lec Nov 18 Cpa & Unfair Trade Practices Final

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  • Selling your ideas is challenging. First, you must get your listeners to agree with you in principle. Then, you must move them to action. Use the Dale Carnegie Training® Evidence – Action – Benefit formula, and you will deliver a motivational, action-oriented presentation.
  • Selling your ideas is challenging. First, you must get your listeners to agree with you in principle. Then, you must move them to action. Use the Dale Carnegie Training® Evidence – Action – Benefit formula, and you will deliver a motivational, action-oriented presentation.
  • Selling your ideas is challenging. First, you must get your listeners to agree with you in principle. Then, you must move them to action. Use the Dale Carnegie Training® Evidence – Action – Benefit formula, and you will deliver a motivational, action-oriented presentation.
  • Selling your ideas is challenging. First, you must get your listeners to agree with you in principle. Then, you must move them to action. Use the Dale Carnegie Training® Evidence – Action – Benefit formula, and you will deliver a motivational, action-oriented presentation.
  • Selling your ideas is challenging. First, you must get your listeners to agree with you in principle. Then, you must move them to action. Use the Dale Carnegie Training® Evidence – Action – Benefit formula, and you will deliver a motivational, action-oriented presentation.
  • Selling your ideas is challenging. First, you must get your listeners to agree with you in principle. Then, you must move them to action. Use the Dale Carnegie Training® Evidence – Action – Benefit formula, and you will deliver a motivational, action-oriented presentation.
  • Open your presentation with an attention-getting incident. Choose an incident your audience relates to. The incidence is the evidence that supports the action and proves the benefit. Beginning with a motivational incident prepares your audience for the action step that follows.

09 Mba Bl Lec Nov 18 Cpa & Unfair Trade Practices  Final 09 Mba Bl Lec Nov 18 Cpa & Unfair Trade Practices Final Presentation Transcript

  • Consumer Protection Act , 1986 CHAPTER 13 , pp 581 - 624
  • What is Consumer Protection ?
  • Protecting the Consumer 2/3 of spending in the world economy (more than $30 trillion ) is by consumers. Yet they have no voice! New Economic Policy floods market with products — Ye Dil Maange More — too little information for informed choice.
  • 15 March 1962 : US President Kennedy introduced the revolutionary notion of rights for consumers to the US Congress :
    • "Consumers, by definition, includes us all . They are the largest economic group in the economy, affecting and affected by almost every public and private economic decision. But they are the only important group whose views are often not heard . ”
  • 9 April 1985 : UN General Assembly adopted guidelines for:
    • consumer protection
    • high levels of ethical conduct of producers / distributors of goods & services
    • curb abusive business practices adversely affecting consumers
    • develop markets providing consumers greater choice at lower prices.
  • UN Principles of Consumer Protection
    • Protect from hazard to health & safety;
    • Promote & protect economic interests;
    • Provide adequate information for informed choice as per individual wish & need;
    • Consumer education including environmental, socio-economic impacts of choice, teaching a value system on wisely using money & goods, complaining effectively;
    • Provide effective redress—formal and informal procedures that are fast, fair, cheap, accessible;
  • UN Guidelines (contd.)
    • (f) Encourage Business Chambers to resolve consumer disputes through advisory services & informal complaint handling mechanisms;
    • (g) Freedom to form groups & present views in decision-making affecting consumers;
    • (h) Promote sustainable consumption patterns.
  • CPA, 1986 is complementary to other laws to protect consumers
    • Laws like the Indian Penal Code, Indian Contract Act, Sale of Goods Act, Drugs and Cosmetics Act, Agricultural Produce (Grading and Marking) Act , Weights & Measures Act, MRTP have existed since pre-independence, but none enshrines rights of Consumers, nor provides swift remedy. Many not applicable to services. Usual remedies like civil suits are costly and time consuming.
  • Exclusion Clauses Have No Effect in Consumer Protection
    • Exclusion clauses are terms of a contract which try to limit the liability of one of the parties if they breach the contract
    • These clauses can create unfair situations where one party is able to insist they are included in the contract because that party is much stronger than the other party
    • Exclusion clauses , privity of contract have no effect in applying CPA
    • Tort of negligence applicable to all parties in supply chain.
  • Consumer Protection Act, 1986 is unique in the world
    • Exclusive courts for consumer disputes in all districts, state and national capitals.
    • 6 consumer rights specified.
    • Consumer Protection Councils from national to state and district levels.
    • Covers private, public, cooperative sectors.
  • Consumer's Rights : Sec 6, C. P. Act, 1986
    • Right to SAFETY against hazardous goods and services
    • Right to be INFORMED about quality, quantity, purity, standard, price, etc
    • Right to CHOOSE from a variety at competitive prices
    • Right to BE HEARD
    • Right to seek REDRESSAL
    • Right to CONSUMER EDUCATION
  • Who is a Consumer? A person , who buys any goods or hires any service (fully or partly paid for) , from a business seller. But NOT goods or services obtained for resale or for any commercial purpose ( except self-employment ) . NOT any service free of charge or under a contract of personal service .
  • Who is a Consumer? A person , who uses any goods or any service with the permission of the consumer is also a consumer. Example : 1. A tenant using the landlord’s telephone with his permission was held to be a consumer of telephone services . 2. Wife eating food ordered by husband is a consumer .
  • Who is a Consumer? R&B Customs Brokers Co Ltd v. United Dominions Trust Ltd : A company, purchaser of a second hand car from a seller selling in the course of business, for the use of its managing director was held to be acting as a consumer buyer.
  • Who is a Consumer?
    • Buyer in following cases is a consumer :
    • Supply of water to cultivators
    • 2. Supply of electricity to a factory
    • 3. Financing of a car by a financier
    • 4. Watercoolers for a bus stand
    • 5. Buyer of a shop
  • Who is a Consumer?
    • Buyer in following cases is not a consumer :
    • Co-op housing society
    • 2. Taxis for tour operations
    • 3. Electricity for a factory
    • 4. Machines for sole properietorship factory
    • 5. Operation at charitable hospital
    • Consumer Protection Act, 1986
    • -socio-economic legislation
    • ensures speedy, cost-effective disposal of grievances
    • amendment of 15.3.2003 makes it more functional & purposeful
    • Act applies to all goods & services (unless exempted)
    • Consumer:
    • 1. one who buys goods or hires services for a consideration
    • 2. beneficiary of such service
    • exclusion : services free of charge
    1
    • Consumer Dispute Settlement
    • Defective goods, deficiency of service may provide cause for dispute and reason for complaint to the consumer
    • These disputes and complaints are required to be settled (redressed) speedily.
    1
  • Consumer Grievance Redressal Agencies
    • A hierarchy of three levels :
    • District Forums
    • State Commissions
    • National Commission
  • Consumer Courts Jurisdiction and appeals :
    • District Forum (less than Rs. 20
    • Lacs)
    • State Commissions (between Rs.
    • 20 Lacs - 1 Crore)
    • National Commission (more than
    • Rs. 1 Crore)
  • Who can file a complaint in a Consumer Forum?
    • Sec 2(b) :
    • Consumers or group of consumers having similar interests
    • Voluntary Consumer Associations
    • Central or State Government
    • Legal heir or representative of a deceased consumer
  • WHAT TO WRITE IN A COMPLAINT?
    • The following information must be furnished with the complaint :- 1. Name and full address .
      • 2. Name and full address of opposite party .
      • 3. Description of goods or services.
      • 4. Quality and quantity .
      • 5. Price .
      • 6. Date & proof of purchase or hiring .
      • 7. Nature of problem .
      • 8. Type of redressal wanted .
  • Procedure for Filing a Complaint Under Consumer Protection Act
    • File in triplicate on plain paper to the District Consumer Disputes Redressal Forum where the seller has his business or residence or where the cause of action arises.
    • File complaint within 2 years from the date of the cause of action.
  • UNIQUE FEATURES OF CONSUMER FORA
      • No lawyer or agent is necessary for filing complaint or to make submission. If due to lawyer’s conduct consumer suffers, it is a deficiency in service open to redress.
      • Small nominal fees payable. No charges for despatching notices to opposite parties etc.
      • Every complaint shall be heard and disposed of within 90 days (150 days in case of lab test) from the date of receipt of notice by the opposite party.
  • Fees payable
    •   District Forum
    • Value and compensation claimed - Fee
    • Upto Rs 1 Lakh :
    • Rs 100
    • Rs 1 lakh & above but < Rs 5 lakh :
    • Rs 200
    • Rs 5 lakh & above but < Rs 10 lakh :
    • Rs 400
    • Rs 10 lakh & above but < Rs 20 lakh :
    • Rs 500
  • WHAT KIND OF REMEDIES ARE PROVIDED
    • LAW PROVIDES FOR THE FOLLOWING REMEDIES IN CASE OF A COMPLAINT:- 1. REMOVAL OF THE DEFECT OR DEFICIENCY.
      • 2. REFUND OF MONEY.
      • 3. REPLACEMENT OF THE GOODS.
      • 4. COMPENSATION FOR LOSS OR
      • HARASSMENT OR MENTAL AGONY.
      • 5. PROHIBITION OF MARKETING OF GOODS
      • HAZARDOUS FOR HEALTH OR ENVIRONMENT.
  • Bodies to Facilitate Consumer Awareness
    • Central Consumer Protection Council.
    • State Consumer Protection Council .
    • District Consumer Protection Council .
    • District Consumer Information Centre .
    • Consumer Complaint Cells of Business Chambers & Traders’ Associations.
  • Consumer Education to cover:
    • Health, nutrition, food-borne diseases, food adulteration.
    • Product hazards.
    • Product labeling.
    • Protective laws.
    • How and whom to approach for redress.
    • Information on weights, measures, packaging, prices, quality, availability of basic needs.
    • Environment, pollution, sustainable consumption.
  • UNFAIR TRADE PRACTICES CHAPTER 13 , pp 624 - 631
  • MONOPOLIES AND RESTRICTIVE TRADE PRACTICES ACT,1969 BROUGHT INTO FORCE IN 1970 MODIFIED IN 1984 TO ADD PART B TO IT, WHICH DEFINES UNFAIR TRADE PRACTICES
  • THE SAME SET OF PROVISIONS HAVE ALSO BEEN ADDED TO : CONSUMER PROTECTION ACT , 1986 Sec 2(1)(r)(i)
  • UNFAIR TRADE PRACTICE
    • Where , by any method whatsoever , a belief is created in the minds of consumers as to some quality or utility of goods or services , and the goods or services actually fall short of those beliefs , the method adopted is an unfair trade practice.
  • UNFAIR TRADE PRACTICES
    • 1. FALSE REPRESENTATION
    • 2. FALSE OFFER OF BARGAIN SALE
    • 3. OFFERING OF GIFTS / PRIZES
    • 4. NON COMPLIANCE TO STANDARDS
    • 5. HOARDING , DESTRUCTION OR REFUSAL OF GOODS
    • 6. SPURIOUS GOODS , DECEPTIVE PRACTICES
  • 1.FALSE REPRESENTATION
    • Adopting misrepresentation of facts to promote sale, use or supply of goods or services, e.g.
    • Misleading buyers about another’s goods or services. Eg. Pepsodent whitens teeth twice as effectively as Colgate.
    • Falsely claiming a sponsorship, approval or affiliation. Eg. Our software is tested & approved by Microsoft.
    • Offering misleading warranty or guarantee. Eg. A computer with 3 yrs warranty requires entering into an AMC from the beginning.
  • 1.FALSE REPRESENTATION
    • Adopting misrepresentation of facts to promote sale, use or supply of goods or services, e.g.
    • False suggestion as to quality, efficacy etc. Eg. If you use our fairness cream, you become as beautiful as SS or KK .
    • False need or requirement creation. Eg. Unless you regularly take our Vitamin tablets after 50 , you cannot remain healthy .
    • Suggest false recommendation by doctors. Eg. Dentist ka sujhaya no. 1 brand , approved by leading specialists
  • 2. FALSE OFFER OF BARGAIN
    • Examples :
    • 1. Shirt prices slashed by two third
    • 2. 50 % discount clearance sale
    • 3. Buy fans at 30% discount
    • 4. Motors at 40% discount
  • 3. SCHEMES OFFERING GIFTS
    • Offering, then withholding gifts/prizes.
    • False claim of offering gifts/services when cost is included partly in the price.
  • 4. Non-compliance to Prescribed Standards
    • EXAMPLES :
    • Medicines not manufactured according to standards
    • Electrical items not manufactured as per standards
    • Food purity not as required
    • Services not provided as per standard eg. Surgical procedures not done as per requirements , Auditing not done as reqd.
  • 5. Hoarding , Destruction , Refusal
    • Output restraint on delivery / flow of supplies to impose unjustified costs / restrictions on consumers.
    • Hoarding and creating false scarcity.
    • Destruction of goods to create scarcity and price increase.
    • Refusing to sell on unjust grounds.
  • 6. Spurious Goods , Deceptive Practices
    • Collusive tendering ; market fixing territorially among competing suppliers , depriving consumers of free choice , fair competition .
    • Supplying only to particular distributors or on condition of sale only within a territory .
    • Delaying in supplying goods/services leading to rise in price .
    • Requiring a consumer to buy / hire any goods or services as a pre-condition for buying/hiring other goods or services .
    • Spurious services .
  • MRTPC
    • Complaints related to unfair trade practices can also be made to the Monopolies and Restrictive Trade Practices Commission.
    • They prove redressal of such complaints by ordering that
    • Such practice be stopped
    • By cancelling contracts involving such practices, and
    • By awarding compensation for loss or injury to consumer.
  • NEW COMPETITION LAW BEING PROMULGATED TO REPLACE MRTP ACT
    • See pp 632 – 651 under “Competition Act.”
  • DOs for Fair Business
    • Right product, right service at right price with cash-memo.
    • Honour warranty and guarantee. Provide reliable, adequate after-sales service and spare parts.
    • Honour Consumer Rights to safety, choice, information.
    • Undertake & participate in factual consumer education programmes.
    • Build up a social coalition between producers, sellers, consumers . Establish consumer complaints cells, voluntary codes.