consumer protection act 1986

3. INTRODUCTION
Consumer rights are an integral part
of our lives like the consumerist way
of life. We have all made use of the
mat 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
Government, consumer courts and voluntary organizations that work towards
safeguarding. 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 responsibility is that a consumer is supposed to
shoulder. Consumer Protection Act, 1986 is an important Act in the history of
the consumer movement in the country. The Act was made to provide for the
better protection and promotion of consumer rights through the establishment
of consumer councils and quasi-judicial machinery. It is mile stone in the
history of socio-economic legislation and directed towards public welfare and
public benefits.
The CPA was passed by the Lok Sabha on 5thDecember 1986 and Rajya
Sabha on 10th December, 1986 and assented to by the president in the Gazette
of India. Extra Part II: Section 1 dated 26.12.1986.andat PP 1-12 called, ´the
CPA 1986 (Act No.66 of 1986) and the preamble states that,
An Act 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 consumers dispute and for matters
connected therewith.
Under the Act, consumer disputes redressal agencies have been set up through
out the country with the District Forum at the District level, State Commission
at the State level and National Commission at national level to provide
simple , inexpensive and speedy justice to the consumer with complaints
against defective goods, deficient services and unfair and restrictive trade
practices
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4. The Law relating to consumer protection in India is at recent origin and is
developing slowly, day by day, with the pronouncement of orders passed by
the commissions constituted under the Act all over India and the National
Commission
However the presence of some protective Laws for the benefits of consumer in
the ancient culture cannot be denied.
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5. M EANING
As the preamble of CPA 1986 reflect; this socio-economic Law was enacted to
provide for the better protection of the interest of consumers and for that
purpose the CPA 1986 seeks to provide speedy and simple redressal to
consumer dispute. In Charan Singh v. Healing Touch Hospital the Honorable
Supreme Court has made important observations on the object of the act.
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DEFINITION
S.2(1)d of the act defined consumer as ´Consumerμ means any person
who-(i) Buys any goods for a consideration which has been paid or
promised or partly paid and party promised or under any system
of deferred payment and includes any user of such goods other than
the person who buys such goods for consideration paid or promised or
partly paid or partly promised, or under any system of deferred
payment when person, but does not include 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 a
consideration which has been paid promised or partly paid or partly
promised or under any system of differed payment and includes any
beneficiary of such services other than the person. [hires or avails of ]
the services for consideration paid or promised or partly paid or partly
promised, under any system of differed payment, when such services
are availed or with the approval the first mentioned person.

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OBJECTIVES
1) To assist countries in achieving or maintaining adequate protection for
their population as consumers;
2) To facilitate production and distribution patterns responsive to the needs
and desires of consumers;
3) To encourage high levels of ethical conduct for those engaged in the
production and distribution of goods and services to consumers;
4) To assist countries in curbing abusive business practices by all enterprises
at the national and international levels which adversely affect consumers .
5) To facilitate the development of independent consumer groups .
6) To further international cooperation in the field of consumer protection .
7) To encourage the development of market conditions which provide
consumers with greater choice at lower prices.
FEATURES
Following are the features of the Act are:
1. The Act aims to provide better and all-round protection toconsumers.
2. In terms of geographical application, it applies to the whole of India except
the State of Jammu and Kashmir
3. It applies to all goods and services unless otherwise expressly notified by
the Central Government.
4. It is indeed a very unique and highly progressive piece of social welfare
legislation and is acclaimed as the magna carta of Indian consumers. The
Act has made the consumer movement really Going and more powerful,

7. broad-based and effective and people oriented. In fact, the Act and its
Amendment in 1993 have brought fresh hopes to the beleaguered Indian
consumer. This is the only law which directly pertains to market place and
seeks to redress complaints arising from it. Even prior to 1986, there were
in force a number of laws which could be interpreted in favour of the
consumers. But, this Act is most powerful piece of legislation the
consumer has had before 1986. Its provisions are very comprehensive and
highly efficacious. In fact, it provides more effective protection to
consumers than any corresponding legislation in force even in countries
which are considered to be much more advanced.5) It provides effective
safeguards to the consumers against different types of exploitation such as
defective goods, unsatisfactory (or deficient) services and unfair trade
practice.
IMPLICATIONS OF CONSUMER PROTECTION ACT
The Consumer Protection Act , 2008, (No 68 of 2008) was signed into law on 24 April 2009. The
Act sets out the minimum requirements to ensure adequate consumer protection in South Africa.
This Act constitutes an overarching framework for consumer protection, and all other laws which
provides for consumer protection (usually within a particular sector) will need to be read with this
Act to ensure a common standard of protection.
All suppliers of goods and services will need to take note of the new measures and ensure that they
are able to comply once the Act becomes effective.
Chapters 1 and 5 of this Act, section 120 and any other provision authorising the Minister to make
regulations became effective one year after the signing of the Act by the President, which was 24
April 2010.
The Consumer Protection Act, 2008 came into effect on 31 March 2011.
The Minister of Trade and Industry has given notice on 14 March 2011 in the Government Gazette
that the Consumer Protection Act application to municipalities, other than high capacity
municipalities, will be deferred until further notice. This will have the implication that consumers
cannot apply the protection of the Act to transactions with these municipalities.The Minister also
gave notice on 27 June 2011 in the Government Gazette on the following exemptions:
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8.  banks will be exempt from section 14 of the Act which deals with the expiry and renewal of
fixed term agreements;
 the Pension Fund Industry will be exempt from certain sections of the Act for a period of 18
months from 1 April 2011;
 the Collective Investment Scheme Industry will be exempt from certain sections of the Act
for a period of 18 months from 1 April 2011;
the Security Services Industry will be exempt from certain sections of the Act indefinitely.
CONSUME R RIGHTS
The importance of consumer rights lies in their enforceability, which in turn
depends largely on level of consumer education and awareness. In other
words, it is not enough to have dynamic consumer laws in the country. There
must be an equal thrust on education of all citizens on the consumer rights
available to them and the mechanisms through which these rights, if violated
can be redressed.
The rights of consumer which are being sought to be promoted and protected
through the legislative mandate available under the Consumer Protection Act,
1986 inter- alia include:
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1) The
Right
to
Safety
- The
right to
be

9. protected against marketing of goods and services, which are hazardous to
life and property.
2) The Right to be Informed - The right to be informed about the
quality, quantity, purity, standard and price of the goods or services so as
to protect consumers against unfair trade practice.
3) The Right to Choose - The right to be assured access to a variety of
goods and services at competitive prices
4) The Right to be Heard -The right to be heard and to be assured that
consumers’ interests will receive due consideration at appropriate
authority.
5) The Right to Redress - The right to seek redressal against unfair trade
practices or restrictive trade practices or unscrupulous exploitation of
consumers.
6) The Right to Consumer Education - The right to acquire the
knowledge and skills to be an informed consumer.
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10. Important Aspects of C.P. Act
CONSUMER
- Any person who buys goods or avails services for consideration
- Consideration may be fully paid, partially paid or fully promised to be paid
or partially promised to be paid
- Any body who uses the goods or services with the consent of the consumer.
Complainant
- a Consumer;
- any Voluntary Consumer Association;
- the Central Government;
- the State Governments or Union Territory Administration;
- one or more consumers , where there are numerous
consumers having the same interest and
- in case of death of a consumer, his legal heir or representative.
COMPLAINT
- An allegation in writing by a complainant that:
- An unfair or restrictive trade practice is practised by trader or service
provider
- Goods bought or to be bought or services hired or to be hired suffered from
any deficiency
- Trader or service provider has charged excess price
- Goods and services are hazardous or are likely to be hazardous to life and
safety.
CONSUMER DISPUTE REDRESSAL AGENCIES
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11. Under Section 9 of the Act consumer can file a complaint before the District
forum.
District forum is headed by District judge, he has jurisdiction over the district.
State Commission is headed by Judge of High Court, he has jurisdiction over
the whole State.
National Commission is headed by Chief Justice of India, he has jurisdiction
over the entire Nation.
FIL E TO TH E COMPLAINT
In District Forum if the cost of goods or services and compensation asked for
is up to Rs. 20 Lakhs and cause of action arose there or where the Opposite
Party resides or runs their business or has a branch office;
In State Commission if the cost of goods or services and compensation asked
for is more than Rs. 20 Lakhs and less than Rs. 1 Crore and cause of action
arose there or where the Opposite Party resides or runs their business or has a
branch office;
In National Commission if the cost of goods or services and compensation
asked for is more than Rs. 1 Crore and cause of action arose there or where the
Opposite Party resides or runs their business or has a branch office.
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Fee for Complaint

12. The Fee for filing the Complaint for the district forum is as
under
Sr. No. Value of Goods/Service and Compensation Amount
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of Fees
1) Upto Rs. 1 lakh rupees Rs. 100
2) Rs. 1 Lakh and above but less than Rs.5 lakhs Rs. 200
3) Rs. 5 Lakhs and above but less than Rs. 10 lakhs Rs. 400
4) Rs. 10 lakhs and above but less than Rs. 20 lakhs Rs. 500
The fees shall be paid by Cross demand Draft drawn on a nationalized
bank or through crossed Indian postal order drawn in favor of the
Registrar of the Sate Commission and payable at the place of the State
Commission .
PROCEDURE FOR FILE A COMPLAINT

13. i. Send a notice to the Opposite Party giving him time limit to settle your
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grievance.
ii. Prepare the consumer complaint in the required format
iii. Get the complaint affidavit notarized through a notary.
iv. Make required number of photocopies after notarizing. [4+ no. of Opposite
Parties]
v. Prepare a bank draft from a nationalized bank to pay court fee.
vi. Submit the complaint and court fee to the receiving clerk in the consumer
court who will give you the date for admission hearing and complaint
reference number.
APPEALS
If you are not satisfied with the judgement from the District consumer forum,

14. you can appeal to the State and then to the National commission within 30
days of receiving the order. In short from:
- District Forum to State Commission
- State Commission to National Commission
- National Commission to Supreme Court
LIMITATION PERIOD
- Section 24A of the Act provides that a consumer dispute can be filed within
2 years from the date on which the cause of action arises.
-Appeals are required to be filed within 30 days from the date of receipt of the
court’s order.
RELIEF AVAILABLE TO CONSUMER
i. Replacement of defective goods
ii. Refund of price paid for defective good/services
iii. Removal of deficiency in service
iv. Refund of extra money charge
v. Withdrawal of goods hazardous to life
vi. Compensation for the loss due to negligence of opposite party.
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15. 13
PENALTIES
Penalty under Section 27 CPA
A trader or the complainant fails to comply with an order made by the
relevant consumer forum is liable for punishment(s):
I. Imprisonment- 1 month to 3 Yrs.
II. Fine – Rs.2000- to Rs.10,000-
CAS
E STUDIES
Reebok dealer ordered to pay compensation
(Reebok Dealer vs Harpreet Kanwar )
CHANDIGARH: Consumer Court has ordered a Reebok shoe dealer to pay Rs 5, 000 as
compensation to Harpreet Kanwar for not entertaining her request to change her shoes, which were
of smaller size even after a long wait of eight months, she claimed.
It is notable that Harpreet, a residence of Sector 44, purchased one pair of shoes of particular design
and size UK 9 from Reebok Outlet on July 7 in 2008 but when she opened the shoe box, the pair of

16. shoes which she had purchased was not found therein and instead a wrong size of pair of shoes.
This girl reported this to the manager of the outlet, who asked her to visit the outlet on July 22 to
exchange it. The complainant had visited the showroom a number of times to exchange the shoes
but he failed to do the same and every time took an excuse of non-availability of stock. Moreover,
he also did not issue any exchange slip.
When the dealer delayed the matter for about eight months, the complainant filed a complaint
against him in Consumer Court on March 6 this year. This is admitted by the dealer that the
complainant had visited his premises three to four times but she could not be given the exact pair
due to the unavailability of the stock. However, she was also requested to get back the money of Rs
1,797, the price of the shoe pair, which she refused flatly.
It is also claimed that the complainant had purchased the shoes for her morning walks and physical
exercise to keep her physically fit but due to the careless delay of the showroom manager, she
could not do so as a result her weight increased and her health deteriorated, which caused her great
mentally and physically harassment.
After hearing the both sides of the argument, the Consumer Court directed the trader to refund the
amount of Rs1,794, the price of the shoes and also pay to the complainant a sum of Rs5,000 as
compensation within 30 days of receipt of a copy of the order, failing which the entire amount will
carry interest at the rate of 12 per cent per annum since the date of filing of the case. The dealer
would also be liable to pay the litigation cost of Rs 1,100
SCHOOL GETS RAP FOR RETAINING FEES
CHANDIGARH: Terming the act of KBDAV School, Sector 7, Chandigarh, unjustified in
retaining the total fees of a student who had decided not to pursue his studies at the institute, UT
district consumer disputes reprisal forum directed it to refund the admission fee after deducting
administrative charges and processing charges.
The forum observed, "In our opinion, educational schools or institutions cannot be permitted to
behave like business establishments that work with a profit motive. The respondent school is an
education institution/school and cannot act like a commercial establishment and there is no
justification on the part of the respondent in retaining the substantial fees paid by a student, who
decides not to pursue his/her studies in the said school/institution."
Complainant Ainesh Chandra, who had field an application through his father Arun Chandra, a
resident of Nayagaon, alleged that he took admission in Class VI in the school for the session 2010-
11 and deposited admission fee of Rs 15,900 on February 17 this year.
He was told that classes would start on April 7. He also appeared in the test for admission at St
John’s School, Sector 26, Chandigarh, the result of which was declared on March 25 and he was
successful.
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17. After considering his options, he decided to take admission in St John?s School and deposited a fee
of Rs 11,135. Thereafter, he surrendered the seat in the respondent school before the start of the
classes and sought a refund. He contacted DAV a number of times and on May 12, they handed
over a cheque for Rs 3,000 against the deposit of Rs 15,900.
In their written reply, the respondent stated that the deposit of fee was towards admission and
tuition fee for three months, which was non-refundable in view of rules mentioned on page 30 of
the school diary.
Further, the rules regarding non-refund of fees and other charges were duly displayed on the notice
board, which were never challenged by the complainant.
It was pleaded by the respondent that caution money of Rs 3,000 was refunded to the complainant
after making deductions according to school rules.
The consumer forum stated that in its view, the respondents could deduct some amount towards
processing fee and administrative charges and the balance amount should be refunded.
"Therefore, we are of the view that the respondent was unjustified in its act by retaining the total
fees of Rs 15,900 of the complainant. The respondents should have, at the most, deducted a sum of
Rs 1,000 only, towards processing fee and administrative charges, which they have incurred at the
time of admission of the complainant," the forum stated.
The forum directed the respondent to refund Rs 11,900 (after deducting Rs 1,000 as
service/processing/administrative charges and Rs 3000 which has already been refunded to the
complainant) along with litigation costs of Rs 5,500.
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CONCLUSION
Consumer protection act was implemented to protect the consumers from unfair trade practices of
organizations to protect the interests of consumers.
Consumer protection act solves the disputes of consumers and to provide safety to consumers, the
purpose behind this act is to protect consumers and various authorities have been established to
protect the rights of consumers.

18. 16

19. ACKNOWLEDGEMENT
The satisfaction that accompanies the successful completion of any task would
be incomplete without mentioning the names of people who made it possible,
whose constant guidance and encouragement crowns all efforts with our
success. It is a matter of immense pleasure that we take this opportunity to
express my heartfelt gratitude to Miss Baljinder Kaur for the invaluable
ideas, assistance and encouragement that they provided during my study. We
also wish to express my thanks to them for their helpful reviews, comments
and continual support on my studies.
We shall always visualize their encouraging gesture, competent guidance,
constant inspiration and indefatigable zest to learn more and more.
The completion of this dissertation would not have been possible without the
help and encouragement of my professional acquaintances. We would like to
thank all the people who have helped me in one way or another to complete
my report.
A seminar is a major milestone during the study period of students. It was an
opportunity to prove our caliber.
Finally, I also wish to thank all guest faculties and non-teaching staffs for
supporting me during my whole work.
Rohit Mahajan

20. Sr. No. Contents Page no.
1 Introduction 1
2 Meaning & definition 3
3 Objectives 4
4 Features 5
5 Implication 6
6 Consumer Rights 7
7 Important Aspects 9
8 Consumer Dispute Redressal Agencies 10
9 Fee For Complaint 11
10 Procedure For file A Complaint 12
11 Appeals 13
12 Penalties 14
13 Case Studies 15
14 Conclusion 18
15 Bibliography 19
A
SEMINAR REPORT
ON

21. Consumer Protection Act 1986
In partial
fulfillment of
requirement
For the degree of
MASTER OF COMMERCE
BATCH 2014-15
Submitted to: Submitted by:
Miss.Baljinder kaur Rohit Mahajan
Roll no:1439

22. 19
Bibliography
Websites Visited:
www.scribed.com
www.timesofindia.com
www.slideshare.net
www.ncdrc.nic.in/1_1.html
http://en.m.wikipedia.org/wiki/consumer_protection_act,_1986