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![Consumer Protection Act-1986
2. CASE 2: INDIAN MEDICAL ASSOCIATION V/S V.P. SHANTA AND OTHERS
A three-Judge Bench of the Apex court considered the important question whether and, if so, in what
circumstances, a medical practitioner could be regard d as rendering' service' under section 2( 1)( 0) of the
Consumer Protection Act,1986 and whether the services rendered at a hospital/nursing home could also be
regarded as 'service.' Relying upon it decision in Lucknow Development Authority v, M.K. Gupta. (1994) 1 SCC
243 (where it was held that the definition of 'service' in the Act was very wide), the Court rejected the argument
that only 'occupation' and not 'profession' was covered within the term 'service' and so services rendered by medical
practitioners were outside the purview of section 2(1)(o). It also rejected an alternate argument that 'service'
contemplated under the Act was of the "institutional type which was really commercial enterprise open available to
all who seek to avail thereof"
Referring to section 14(1)(d) and section 2(1)(g), the Bench held that compensation for deficiency in service was to
be awarded applying the same test as in an action for damages for negligence. it went on to observe that the
standard of care that was required of medical practitioners was laid down in the English decision in Bolaml v
Friern Hospital Management Committee 1(1957) 1AI/ ER 118] which had been accepted by the house of Lords
and applied in a number of cases. Reference was also made to the Court'. earlier decision in Dr. LaxmanBalkrishna
Joshi v Dr. TrimbakBapuGodbole& Another [(1969) 1 CR 206].
The Supreme Court repelled the contention that the Consumer Forum were not equipped to appreciate complex
issues which might arise in cases of medical negligence and observed that these Forum were presided over by
Judges/retired Judge who were well versed in law and, combined with lay decision making by members with
knowledge and experience in various fields, the constitution of the Forum was adequate to deal with cases of
medical negligence. Further, the safeguard of appeal against the orders of the Forum was available. The Court also
did not agree that the summary procedure provided for in the Act was not sufficient to deal with such cases and
observed that not every complaint would raise complicated questions. It also observed that in complaint' involving
issues requiring recording of expert evidence, the Forum could ask the complainants to approach the civil court. It
also noted that very few cases of medical malpractice had been filed till 1985, one of the reasons of which was the
court fee payable in an action for damages (before civil courts) but no court fee was required to be paid under the
Act,
Holding medical practitioners, government hospitals/ Nursing homes and private hospitals/ nursing homes fell into
three categories:
(i) where services are rendered free of charge to everybody;](https://image.slidesharecdn.com/legalpresentation-170330051520/85/Legal-presentation-33-320.jpg)
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The Consumer Protection Act of 1986 was established to safeguard consumers in an era of globalization and e-commerce, shifting the focus from 'let the buyer beware' to 'let the seller beware'. It outlines consumer rights, including the right to safety, information, choice, and redress, addressing issues such as misleading advertising and spurious goods. The Consumer Guidance Society of India (CGSI) plays a pivotal role in educating consumers, resolving complaints, and promoting consumer rights throughout the nation.
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- 1. Consumer Protection Act-1986 “NEEDFOR CONSUMER PROTECTION ACT IN AN ERA OF FREE COMPETITION WHERE CONSUMER IS THE KING THEREFORE, KING NEED PROTECTION”
- 2. Consumer Protection Act-1986 TABLEOF CONTENT CONTENTS Page no. INTRODUCTION 2 NEED FOR CONSUMER PROTECTION ACT 3-4 INTERNATIONAL SCENARIO 5 CONSUMER RIGHTS 6-8 CONSUMER GUIDANCE SOCIETY OF INDIA (CGSI) 9-13 CONSUMER PROTECTION ACT, 1986 14-15 CONSUMER 16-17 COMPLENT 18-24 DISMISSAL OF FRIVOLOUS AND VEXATIOUS COMPLAINTS 24-26 CONSUMER PROTECTION COUNCILS 27-31 CASE STUDY 32-38 GOVERNMENT INITIATIVES FOR PROTECTION OF CONSUMER RIGHTS & STATISTICS 39-45 ROLE OF NON-GOVERNMENTAL ORGANIZATIONS 46 CONCLUSION 47
- 3. Consumer Protection Act-1986 INTRODUCTION “Customerservice shouldn’t just be a department; it should be the entire company” – Tony Hsieh (CEO, Zappos) “Your most unhappy customers are your greatest source of learning” – Bill Gates (Founder, Microsoft) In olden days the principal of ‘Coveat Emptor’ which means buyer beware governed the relationship between the buyer and seller. But in the era of open market buyer and seller came face to face, seller exhibit his goods and consumer thoroughly examined them and then purchased it. But with the growth of technology, emergence of e- commerce and globalization the consumers are deprived of quality of good to a greater extent. As a result buyer is being mislead, deceived day in and day out. ‘Consumer, client and customer’ world over, are demanding quality goods and better services for the value of their money. Consumer are said to be the king of the market because they are the people who need to be satisfied. A product or service will not be successful if the consumer needs are not satisfied. Therefore, in today’s world the firm do not leave any opportunity unturned to attract customer and gain important image in the market. Webster's dictionary defines Consumerism as “the promotion of the consumer’s interests” or alternately “the theory that an increasing consumption of goods is economically desirable”. "Consumerism" is likely to dominate the Indian market in the coming years, thanks to the economic reforms in the present years and increased direct foreign investment in the retail sector. The transition will be from a predominant from ‘sellers market’ to a ‘buyers market’ where the choice exercised by the consumerwillbe influenced by the level of consumer awareness achieved. "Consumerism" also mean the process of realizing the rights of the consumer as envisaged in the Consumer Protection Act (1986) i.e right to safety, right to be informed, right to choose, right to be heard, right to redress, right to consumer education, right to satisfaction of basic needs and ensuring right standards for the goods and services. The big multinational will leave no chance to gain attraction from consumer and will try to gain image in market. However, some of the company try to engage in unscrupulous, exploitative and unfair trade practices like defective and unsafe product, adulteration, false and misleading advertising hoarding, black marketing etc. the
- 4. Consumer Protection Act-1986 earlierapproach of caveat emptor, which means ‘let the buyer beware’, has now changed to caveat venditor ‘let the seller beware’. There should active need for consumer protection rights. Consumer protection includes educating consumers about their rights and responsibilities and helping them to seek redressal of their grievances. NEED FOR CONSUMER PROTECTION The fact of life is that the consumers are still victims of unscrupulous and exploitative practices. Exploitation of consumers are done in following ways such as:- Adulteration of goods:- Adulteration means intentionally adding an inferior substance in the product to gain more profit from it. Most of the time consumers are being provided with this adulterated product even after paying high prices. Spurious goods:-Spurious goods are copy of the original products having well-known trade marks, logos, along with the external packaging etc, so that they look same like an original product. Thus it is very much necessary to protect consumer from such exploitations. Misleading Advertising:-Consumers are always mislead by false advertising and are unaware of the real quality of the advertised goods. Misleading information about product’s quality, safety is provided by some company so preventive measures should be taken to handle this false advertising. Artificial Scarcity:- It is always seen that some organization create artificial scarcity in market by irregular supply goods, so that there will be shortage of goods which will lead to high price
- 5. Consumer Protection Act-1986 OtherProblems:- Malpractices by company, Misleading technique, False warranties and guarantees, Black marketing etc. The Purpose of Consumer Protection To prevent practices having adverse effect on competition. To promote and sustain competition in markets. To protect the interests of consumers and to ensure freedom of trade carried on by other participants in the markets. Prohibition of anti-competitive agreements. Prohibition against abuse of dominant position. International Scenario The purpose of development combined with liberalization and globalization across the country has enabled consumers to realize their significant role in society and governance. In the developing counties like India where poverty and unemployment is very high and level of literacy is very low, the people face number of problems, particularly related to consumer related issues. Unlike in developed countries, consumer in this countries have not been able to play a greater role in the development process. The purpose of economic planning, is to allocate resources, as far as possible, maximum satisfaction of consumer needs. Any goods and services produce in the economy is ultimately for the consumer. There is a logical, moral, political force in the proposition that the consumer themselves should have the right to take decision about the allocation of resources as per their own needs. Realizing this need, the International Organization of Consumer Unions, now known as Consumer International, took the initiative and under its consistent lobbying, the United Nation adopted the set of Guidelines for Consumer Protection On April 9, 1999. The guidelines address the interest and needs of the consumer worldwide and provide a framework for Government, particularly those for developing and newly independent countries, to use for elaborating and strengthening consumer protection policies and legislation.
- 6. Consumer Protection Act-1986 TheUN Guideline have outlined the following eight areas for developing policies for consumer protection:- Physical safety; Promotion and protection of consumer’ economic interests; Standards for safety and quality of consumer goods and services; Distribution facilities for essential consumer goods and services; Measures enabling consumers to obtain redress; Education and information programmes; Promotion of sustainable consumption; and Measures relating to specific areas like water, food and pharmaceuticals. These areas have been translated into the following six consumer rights by the Consumers’International: 1. Right to Basic Needs 2. Right to Safety 3. Right to Choice 4. Right to Information 5. Right to Consumer Education 6. Right to Redressal The above eight rights are explained in details below:- Consumer Rights Consumer have rights and it is a consumers’ responsibility to ensure that these rights are adhered to at all times. Consumer Rights can be defined as being in agreement with what is just, good or proper when dealing with consumers as well as ensuring that the consumer is protected from harm or wrong doing with a provider of a service or a distributor of a product. 1. Right to Safety:- Consumer has a right to be protected against the dangerous goods and services that they buy. It is also need to ensure that product and services do not negatively impact on the health of the consumer. Consumer, therefore, has a right to safety for all risk involved in those goods which are harm full and besides causing any loss to money. Hence it is consumers’ responsibility to use product safely.
- 7. Consumer Protection Act-1986 Example:There are some plastic bottles which are unsafe and should be used once. The manufacturer should mentioned all the factors that are unsafe in using plastics and also aware consumer about the waste which they leads to. 2. Right to choose:- Consumers has a right to insist on a variety of products and goods to choose based on personal taste, quality or price. It was seen that some of the company making the monopolistic way of selling the product because of that government passed this right in favor of consumer as a right to choose. It protects consumer and give them freedom to choose their favorite product from different variety of products, it also destroys the monopoly of consumers. Example:If women went to buy a clothes in a shop and where in there are various substitute available varying in price, quality and brands. Suppose she wants to select a specific brand, she can select any clothe of her choice available in the showroom. Her she enjoys ‘Right to Choose’ and its her responsibility that she makes a right choice. 3. Right to Information:- Consumer has a right to get all the necessary information of product or services which he decide to buy. Therefore it is a consumers’ right to get detailed information about the quality, quantity, purity, safety, standard, price of good etc. Example:-On some product details about ingredients are mentioned at the back. The packet should also mention the ingredient used are non-veg based or a veg based. Green color indicates it’s a vegetarian and brown color dot indicates it is a non-vegetarian. Thus manufacture should clearly mention this on there product and consumer should buy it with due care. 4. Right to be Heard:- The retailer, supplier or anyone else involved must listen to the consumer when they complaint. The complaint should be addressed with the person at the top manager of a particular store. This right helps to empower the consumer of India for putting forward their complaints and concerns fearlessly and raising their
- 8. Consumer Protection Act-1986 voiceagainst product or even companies and ensures that their issues are taken into consideration as well as handled properly. Right to be heard helps consumer to even upload videos, post comments ans suggestions on various issues. 5. Right to Seek Redressal:- Consumer must seek redressal against unfair trade practices or unscrupulous exploitation. They can also take help of consumer organizations in seeking redressal of their grievances. The consumer courts like District Consumer Disputes Redressal Forums at District level, State Consumer Disputes Redressal Commissions and National Consumer Disputes Redressal Commissions have been incorporated with the help of the consumer protection act. Example:-When consumer are sold with inferior product or service, a refund. In some instance this right is protected by law and consumers can take their case to the court to exercise their right to redress. 6. Right to Consumer Education:- Consumer education is essential to provide the skills and knowledge to empower consumers and enable them to use their resources effectively and increase their awareness of their wider role in society. Consumer education is the only single cost effective that provides and guarantees consumer protection. It helps consumer against abuses in the market place, consumer education also serve as a preventive measures. For example, educated consumer will protect themselves and prevent exploitation in the market place. Example:-If consumer purchase a refrigerator or television, it’s a manufacturers responsibility to provide him with knowledge of its operations such as working, cooling etc. so that consumer gets maximum benefit from it. CONSUMER GUIDANCE SOCIETY OF INDIA (CGSI)
- 9. Consumer Protection Act-1986 POSTINDEPENDENCE, India has been striving to develop and make or become stronger , its industrial base. In this pursuit of “self-sufficiency,” consumers have endure use of sub-standard products and services, adulterated foods, short weights and measures, spurious and hazardous drugs, exorbitant prices, endemic shortages leading to black marketing and profiteering, unfulfilled manufacture guarantees, and a host of other problems. In 1960’s exploitation of consumers by manufacturers and service providers was rampant in India with a few monopolistic business houses controlling the industry. In one infamous case, forty persons suffered dropsy and glaucoma after consuming groundnut oil adulterated with toxic argemone oil. The victims did not get any justice and the culprits escaped without punishment. This outrage energized nine women to organize a movement to fight and protect consumer rights by establishing the first consumer organization in India the Consumer Guidance Society of India (CGSI) in 1966 to resist the silent suffering of consumers, and exploitation of all forms. CGSI that has grown in strength. Golden Jubilee (1966-2016)-50 years in the service of consumers The Consumer Guidance Society of India (CGSI) is the first and foremost consumer body of the country. The Maharashtra State Government has entrusted CGSI to establish and manage the Maharashtra State Consumer Helpline. Helpline by calling the Toll-free Number : 1800 22 22 62 or by e-mail: mah.helpline@gmail.com. CGSI has reached out to lakhs of consumers and conducted workshops and seminars on consumer awareness topics like food adulteration, becoming a smart investor and consumer protection. They believe in the consumer cause which includes “Value for Price, Value for People and Value for Environment”. Their aim was to protect the rights of consumers, who found themselves helpless whenever they were supplied with defective goods or services.Maharashtra State Consumer. The Presidents CGSI Were: Prof. N. M. Rajadhyaksha(2014-2016) The Founder members of CGSI were:
- 10. Consumer Protection Act-1986 SocialWorker:-Mrs.Seeta Gupta, Mrs.Indira Mazumdar,Mrs. SeetaNadkarni,Mrs. NaliniTulpule Mrs. Shakuntala Kadam Doctor :- Dr. LeelaThorat Journalist:- Mrs. Leela Jog, Mrs. Kamala Mankekar Scientist:- Dr. Shanta S. Rao The Activities of Consumer Guidance Society of India CGSI was the first consumer organisation to demand special Consumer Court for redressal of consumers’ complaints. In 1975, CGSI led a delegation of five consumer organisations from different parts of India to the then Minister for food and Civil Supplies, Mr.T.A. Pai, to press for a comprehensive Consumer Protection Act, Special Consumer Court and a Directorate for implementation of the Act. The first two have now become a reality. 1. COMPLAINT REDRESSAL- CGSI handles consumer complaints and offers legal guidance to those wishing to file suits in the Consumer Court. In case where there are a number of complaint against a particular party, both sides are brought together to resolve the issue. The CGSI’S Complaints Committee meets twice a week. Many thousands of grievances have been handled over the years, with 70% success in favour of the complaints cover medical/surgical malpractice and negligence; insurance non-payment; sub-standard drugs and medicines; home remedies; defective household appliances; poor quality foods and drinks; misleading advertising claims; and grievances concerning investments, real estate, insurance, telephones, electricity supply, etc. 2. PRODUCT TESTING-As early as 1977, CGSI established the facility of product testing. It first assessed the safety and perforamance of domestic pressure stoves and found that two-third of the samples tested failed in safety Parameters. CGSI sent the results to the government and Indian Standards Institution (ISI) with a demand for mandatory certification. In 1986, the Pressure Stoves Quality Control Order was passed. later,ISI Certification for pressure stoves became mandatory. Subsequently tests were carried out on electrical appliances and fittings – irons, immersion heaters, This culminated in the enactment of the Household Electrical Appliances (Quality Control) Order. A food adulteration testing kit has been developed for use by the lay consumer. Many other products were tested and reports published in the Society’s monthly Journal, “Keemat”: edible oils, powdered spices, ‘surma’, geysers, clinical thermometers, plastic water bottles, rubber teats, milk, mineral water, bread, soft drinks, bath soaps and toothpaste.
- 11. Consumer Protection Act-1986 3.CONSUMER EDUCATION FOR SCHOOLS/COLLEGES- Due to its efforts, the Maharashtra Education Board introduced consumer education at the 9th standard level, progressively covering students from 4th standard upwards. Consumer education is also introduced in colleges. 4. PUBLICATIONS -“Keemat” is now in its 32th year of publications, the first Consumer magazine in India to be published regularly every month. CGSI has also produced Consumer Guides on subject like Electrical Appliances, Edible Oils, Pesticides, Food, Adulteration, Safety At Home, Safe Blood, etc 5. NATIONAL AWARD-In 1991, CGSI received the National Award for Consumer Protection in its 25th year for service to Consumers. CGSI hopes to reach out to more and more consumers in the new millenium and to developed newer and more effective methods of serving consumers interest. CGSI is a consumer rights organization based in Mumbai, India. It was the earliest consumers’ organization in India and became the first to conduct formal product testing in 1977. CGSI publishes a magazine, “Keemat”. It has also printed 85,000 illustrated brochures in English, Hindi, and Marathi for free distribution. CGSI Role : CGSI has reached out to lakhs of consumers and conducted workshops and seminars on consumer awareness topics like food adulteration, becoming a smart investor and consumer protection. CGSI Responsibility : Develop a resource centre at State level which will be networked with the National Resource Centre Develop Alternate Consumer Disputes Redressal mechanisms at the State level Resolve maximum number of disputes out of court Promote active participation of companies and service providers in resolving consumer disputes Early resolution of complaints Reach out to rural consumers Capacity building of State level Voluntary Consumer Organizations Provide service in regional language in addition to English language
- 12. Consumer Protection Act-1986 Followingare some some of the landmarks achieved by CGSI : 1. CGSI is the earliest consumer organisation in India, founded in 1966. 2. CGSI was the first to demand a Consumer Protection Act with Consumer Courts to implement it. This become a reality in 1986. 3. To date, 70% of the thousands of complaints referred to CGSI have been redressed. 4. CGSI established formal Product Testing in India. 5. CGSI was the first to publish a monthly magazine “Keemat” carrying information of importance to consumer. 6. CGSI promotes consumer education; initiates training projects in rural areas; Promotes publicity drives; represents consumer interests with Government and other bodies. 7. CGSI received the National Award for consumer Protection in 1991. 8. CGSI is the only Indian consumer organisation to be a council member of Consumer International for 25 years. 9. CGSI is a member of the Maharashtra State Consumer Protection Council. 10. CGSI participates in a large number of technical committees and government decision-making bodies.
- 13. Consumer Protection Act-1986 FSSAI– MILK PRODUCT STANDARDS – FOR MAHARASHTRA 2015-2016 CLASS OF MILK DESIGNATION MINIMUM % Milk Fat Milk Solids Not Fat (S. N. F) Cow Milk Raw, Pasteurized, boiled, flavored, and sterilized 3.5 8.5 Buffalo Milk Raw, Pasteurized, boiled, flavored, sterilized 6.0 9.0 Goat or Sheep Milk Raw, Pasteurized, boiled, flavored, and sterilized 3.5 9.0 Mixed Milk Raw, Pasteurized, boiled, flavored, and sterilized 4.5 8.5 Standardized Milk Pasteurized, flavored, and sterilized 4.5 8.5 Recombined Milk Pasteurized, flavored, and sterilized 3.0 8.5 Toned Pasteurized, flavored, and sterilized 3.0 8.5 Double Toned Pasteurized, flavored, and sterilized 1.5 9.0 Skimmed Raw, Pasteurized, boiled, flavored, and sterilized Not more than 0.5 8.7 Full Cream Milk Pasteurized, and sterilized 6.0 9.0 IF CLASS OF MILK IS NOT INDICATED THEN THE STANDARDS OF BUFFALO MILK SHALL APPLY
- 14. Consumer Protection Act-1986 CONSUMERPROTECTION ACT, 1986 Consumer Protection Act is an Indian federation law enacted in 1986 to protect interests of consumers in India. It makes provision for the establishment of consumer councils and other authorities for the settlement of consumerdisputes and for matters connected therewith.The Consumer Protection Act, 1986 has defined the term CONSUMER. Only the complainant who falls under the definition of Consumer can be benefited through Consumer Protection Act. Hence the definition of CONSUMER is of much importance to determine the applicability of the Act. In India various Acts intende to protect the consumers against different forms of exploitation were enacted,such as, Indian Contract Act, 1872 Prevention of Food Adulteration Act, 1954 Essential commodities Act, 1955 Standard of Weights and Measures (Enforcement) Act, 1985 Some significant consumer protection enactments of pre-independence time are : The Sale of Goods Act, 1930 Insurance act, 1938 Agriculture Produce (Grading and Marketing) Act, 1837 Indian Post office act, 1898 In spite of these Acts the consumers did not have any effective mechanism or institutional arrangement for the speedy redressal of their grievances and also the lack of effective popular movement isolated the consumer and his plight only increased. Seeing the pressure mounting from various consumer protection groups and the consumer themselves the Parliament enacted the Consumer Protection Act in 1986.
- 15. Consumer Protection Act-1986 IMPORTANTFEATURES OF THE ACT: This may be summed up as under: The Act applies to all goods and services unless specifically exempted by the Central Government. It covers all the sectors that is private, public and cooperative sector. The provisions of the Act are compensatory in nature. It provides adjudicatory authorities, which are simple, speedy and less expensive. It also provides for Consumer Protection Councils at the National, State and District level. The Consumer Protection Bill, 1986 was passed by both the Houses of Parliament and it received the assent of the President on 24th December, 1986. It came on the Statutes Book as the Consumer Protection Act, 1986. CONSUMER Consumer Protection Act says that consumer means : Any person who buys any commodity or service or is a user of such commodity or service is known as consumer. Any person must satisfy two conditions to claim himself as a consumer:- 1. The service must have been rendered to him 2. He must have paid or promised to pay for the same. If any person buy capital goods to provide services to other individuals, then he is also recognized as consumer.If any person buys a commodity with an intention to resaleor a person who obtains services without consideration or a person who obtains services for commercial purpose. “Commercial purpose” does not include use by a consumer of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self-employment.
- 16. Consumer Protection Act-1986 CONSUMEROF GOODS The provision reveals that a person claiming himself as a consumer of goods should satisfy that— 1. THE GOODS ARE BOUGHT FOR CONSIDERATION : There must be a sale transaction between a seller and a buyer; the sale must be of goods; the buying of goods must be for consideration. The terms sale, goods, and consideration have not been defined in the Consumer Protection Act. The meaning of the terms ‘sale’, and ‘goods’ is to be according to the Sale of Goods Act, and the meaning of the term ‘consideration’ is to be according to the Indian Contract Act. 2. ANY PERSON WHO OBTAINS THE GOODS FOR ‘RESALE’ OR COMMERCIAL PURPOSES’ IS NOT A CONSUMER – The term ‘for resale’ implies that the goods are brought for the purpose of selling them, and the expression ‘for commercial purpose’ is intended to cover cases other than those of resale of goods. When goods are bought to resell or commercially exploit them, such buyer or user is not a consumer under the Act. Examples: A jeep was purchased to run it as a taxi. The question was whether the buyer of the jeep was a consumer under the Act. The Rajasthan State Commission held that to use the jeep as a taxi with the object to earn profits was a commercial purpose, and therefore, the buyer/user was not a consumer within the meaning of the Act. [Smt. PushpaMeena v. Shah Enterprises (Rajasthan) Ltd. (1991) CONSUMER OF SERVICES Service means service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service. * SERVICES ARE HIRED OR AVAILED OF The term ‘hired’ has not been defined under the Act. Its Dictionary meaning is - to procure the use of services at a price. Thus the term ‘hire’ has also been used in the sense of ‘avail’ or ‘use’. Accordingly it may be understood that consumer means any person who avails or uses any service.
- 17. Consumer Protection Act-1986 Example:A goes to a doctor to get himself treated for a fracture. Here A is hiring the services of the doctor. Thus he is a consumer. What constitutes hiring has been an issue to be dealt with in many consumer disputes. If it is established that a particular act constitutes hiring of service, the transaction falls within the net of the Consumer Protection Act, and vice-versa. Examples: A passenger getting railway reservation after payment is hiring service for consideration. * CONSIDERATION MUST BE PAID OR PAYABLE Consideration is regarded necessary for hiring or availing of services. However, its payment need not necessarily be immediate. It can be in installments. For the services provided without charging anything in return, the person availing the services is not a consumer under the Act. Examples: A hires an advocate to file a suit for recovery of money from his employer. He promises to pay fee to the advocate after settlement of the suit. A is a consumer under the Act. * BENEFICIARY OF SERVICES IS ALSO A CONSUMER When a person hires services, he may hire it for himself or for any other person. In such cases the beneficiary (or user) of these services is also a consumer. Example: A takes his son B to a doctor for his treatment. Here A is hirer of services of the doctor and B is beneficiary of these services. For the purpose of the Act, both A and B are consumers. COMPLAINT An aggrieved consumer seeks redressal under the Act through the instrumentality of complaint. It does not mean that the consumer can complain against his each and every problem. The Act has provided certain grounds on which complaint can be made. Similarly, relief against these complaints can be granted within the set pattern. It is a formal legal document that sets out the facts and legal reasons that the filing party or parties believes are sufficient to support a claim against the party or parties against whom the claim is brought that entitles the filing party to a remedy (either money damages or injunctive relief)
- 18. Consumer Protection Act-1986 Complaintis filed for defect in goods, deficiency in service, charging of excess price Hazardous goods, unfair trade practice or restrictive trade practice. a) Defects: Any fault, imperfection or shortcoming in the quality, quantity, potency, purity or standard which is required to be maintained by or under any law for the time being in force or under any contract express or implied or as is claimed by the trader in any manner whatsoever in relation to any goods. b) Deficiency: Any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service. c) CHARGING EXCESSIVE PRICE A complaint may be made against a trader who has charged a price in excess of the price: a) fixed by or under any law for the time being in force, or b) displayed on the goods, or c) displayed on any package containing the goods. d) HAZARDOUS GOODS The term “Hazardous goods’ has not been defined in the Act. The dictionary meaning of the term is - dangerous or risky. However, the term is used in context of ‘goods’ only, i.e., a person can make a complaint if he is not informed about the hazardous nature of the goods but the same is not true in case of hazardous services. The law seeks to ensure that those responsible for bringing goods to the market, in particular, suppliers, exporters, importers, retailers and the like should ensure that while in their care these goods are not rendered unsafe through improper handling or storage. Consumers should be instructed in the proper use of goods and should be informed of the risks involved in intended or normally foreseeable use. Vital safety information should be conveyed to consumers. Example: A bought an insecticide from B. B did not inform A that touching this insecticide with bare hands can create skin problem. A, while using the insecticide came in contact with it and suffered from skin problem consequently. Here B can be held liable under the Act. A Complaint should contain the following information: (a) The name, description and address of the complainant; (b) The name, description and address of the opposite party or parties;
- 19. Consumer Protection Act-1986 (c)The facts relating the complaint and when and where it arose; (d) Documents ‘if any’ in support of allegations and (e) The relief which the complainant is seeking. The complaint should be signed by the Complainant or his/ her authorised agent. COMPLAINANT: Complainant means - A consumer to whom goods are sold or delivered or agreed to be sold or delivered or such services provided or agreed to be provided. - Voluntary Consumer Organisation. - The Central Government. - The State Governments or Union Territory Administration. - One or more consumers, where there are numerous consumers having the same interest. CONSTITUTES OF A COMPLAINT Complaint is a statement made in writing to the National Commission, the State Commission or the District Forum by a person competent to file it, containing the allegations in detail, and with a view to obtain relief provided under the Act. PROCEDURE TO FILE A COMPLAINT: Procedures for filing complaints and seeking redressal are simple. There is no fee for filing a complaint before the District Forum, the State Commission or the National Commission. A stamp paper is also not required. There should be 3 to 5 copies of the complaint on plain paper. The complainant or his authorized agent can present the complaint. The complaint can be sent by post to the appropriate Forum / Commission. ELIGIBILITY FOR FILING A COMPLAINT At the outset it is clear that a person who can be termed as a consumer under the Act can make a complaint. To be specific on this account, following are the persons who can file a complaint under the Act: a consumer; or any voluntary consumer association registered under the Companies Act, 1956 or under any other law for the time being in force, or the Central Government or any State Government, One or more consumers, where there are numerous consumers having the same interest.
- 20. Consumer Protection Act-1986 Inaddition to the above following are also considered as a consumer and hence they may file a complaint: Beneficiary of the goods/services: The definition of consumer itself includes beneficiary of goods and services As per the amendments made vide the Consumer Protection (Amendment) Act, 2002; in case of death of a consumer, his legal heir or representative can file a complaint. Legal representative of the deceased consumer: The Act does not expressly indicate that the legal representative of a consumer is also included in its scope. But by operation of law, the legalrepresentatives get clothed with the rights, status and personality of the deceased. Thus the expression consumer would include legal representative of the deceased consumer and he can exercise his right for the purpose of enforcing the cause of action which has devolved on him. Legal heirs of the deceased consumer: A legal heir of the deceased consumer can well maintain a complaint under the Act Husband of the consumer : In the Indian conditions, women may be illiterate, educated women may be unaware of their legal rights, thus a husband can file and prosecute complaint under the Consumer Protection Act on behalf of his spouse - Punjab National Bank, Bombay v. K.B. Shetty 1991 (2) CPR 633. A relative of consumer: When a consumer signs the original complaint, it can be initiated by his/her relative - MotibaiDalvi Hospital v. M.I. Govilkar 1992 (1) CPR 408. Insurance company: Where Insurance Company pays and settles the claim of the insured and the insured person transfers his rights in the insured goods to the company, it can file a complaint for the loss caused to the insured goods by negligence of goods/service providers. For example, when loss is caused to such goods because of negligence of transport company, the insurance company can file a claim against the transport company - New India Assurance Company Ltd. v. Green Transport Co. II 1991 CPJ (1) Delhi. REQUIREMENTS OF A COMPLAINT A complaint must contain any of the following allegations as per the Act: (a) An unfair trade practice or a restrictive trade practice has been adopted by any trader; Example: A sold a six months old car to B representing it to be a new one. Here B can make a complaint against A for following an unfair trade practice. (b) The goods bought by him or agreed to be bought by him suffer from one or more defects;
- 21. Consumer Protection Act-1986 Example:A bought a computer from B. It was not working properly since day one. A can make a complaint against B for supplying him a defective computer. (c) The services hired or availed of or agreed to be hired or availed of by him suffer from deficiency in any respect. Example: A hired services of an advocate to defend himself against his landlord. The advocate did not appear every time the case was scheduled. A can make a complaint against the advocate. (d) 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. Example: A bought a bag of cement from B who charged him Rs. 100 over and above the reserve price of the cement declared by the Government. Here A can make a complaint against B. (e) 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. Example: A bought a tin of disinfectant powder. It had lid which was to be opened in a specific manner. Trader did not inform A about this. While opening the lid in ordinary way, some powder flew in the eyes of A which affected his vision. Here A can make a complaint against the trader. TIME FRAME WITHIN WHICH A COMPLAINT CAN BE FILED In 1993, the act provides that a consumer dispute can be filled within two years from the date on which the action to place. In 1963, the Consumer Forums were following the Limitation Act, which say that it can be filed within three years after the action took place. To file a complaint the point of time when the action arises is an important factor for determining the time period available. There are no set of such rules which decide time rather it depends on the facts and circumstances of each case. Examples: Dolly deposited some jewelry in a bank and the bank lost it. Bank kept on giving Dolly false sense of hope to retrieve the jewelry and thus Dolly was put in a state of inaction. Later on when Dolly filed a suit on the bank, it claimed that the suit was not maintainable as the limitation time after the cause of action arose has lapsed. James got his operated by Dr. John in 1990. He got a certificate of blindness on 18th December 1990. He was still in a hope of gaining his sight and went for second operation in 1993 and was discharged on 21-1-1993. He filed a
- 22. Consumer Protection Act-1986 complaintagainst Dr. John on 11-1-1995. Dr. John opposed on the ground that more than 2years were over after 18-12-1990, thus the complaint is not maintainable. The commission held that here the cause of action for filing the complaint would arose after the second operation when James lost entire hope of recovery. RELIEF AVAILABLE AGAINST COMPLAINT A complaint can seek any one or more of the following relief under the Act: 1. To remove the defect pointed out by the appropriate laboratory from the goods in question. 2. To replace the goods with new goods of similar description which is free from defects. 3. To return the complainant the price or charges paid by the complainant. 4. To pay some amount as a compensation to the consumer for any loss or injury suffered by them due to negligence of the opposite party. 5. To remove the defects in the services. 6. To discontinue the unfair trade practice or restrict trade practice or not to repeat it. 7. To reject the hazardous goods for sale. 8. To withdraw the hazardous goods from being offered for sale. 9. To provide adequate costs to complainant. CIRCUMSTANCES WHEN A COMPLAINT CANNOT BE FILED 1. A complaint on behalf of the public which consist of unidentifiable consumer which cannot be filed under the Act. Example: A complaint was filed on the basis of a newspaper report that passengers travelling by flight no. 1C-401from Calcutta to Delhi on May 13, 1989 were made to stay at the airport and the flight was delayed by 90 minutes causing great inconvenience to the passengers. It was held that such a general complaint cannot be entertained. The passenger who boarded that plane did not came forward or authorized the complainant to make the complaint. 2. A complaint by an individual on behalf of general public is not permitted. 3. An unregistered association cannot file a complaint under the Act. Example: the complainant was an association formed in the Gulf and was unregistered in India. It was held that since the petitioner was not a voluntary organization registered under any law in force in India, cannot come within clause (d) of section 2(1) of the Act and hence can’t file a complaint.
- 23. Consumer Protection Act-1986 4.A complaint after expiry of limitation period is not permitted. A complaint cannot be filed after the lapse of two years from the data on which the cause of action arise unless the Forum is satisfied about the genuineness of the reason for not filing complaint within the prescribed time. Example:Rohan supplied defective machinery to Abhay on 12-1-1998. Abhay filed a suit against Rohan on 10-3-2001. It was admitted before the Forum for the reason that the time available to make complaint lapsed. DISMISSAL OF FRIVOLOUS AND VEXATIOUS COMPLAINTS If district forum, the state commission or the national commission found the compliant as frivolous or as vexatious, they have the power to dismiss the compliant and can make an order that the complaint shall pay to the opposite party an amount which is ordered or Rs 10000. Example: A filed a complaint against B to recover compensation of Rs. 55,99,000 with the motive of indulging in speculative litigation taking undue advantage of the fact that no court fee was payable under the Consumer Protection Act. The National Commission held that the complainant has totally failed to make a case against B, and dismissed the complaint as frivolous and vexatious imposing Rs. 10,000 as costs to A UNFAIR TRADE PRACTICE AND RESTRICTIVE TRADE PRACTICE We have discussed that a consumer can make a complaint when an unfair or a restrictive trade practice is followed by a trader. * Unfair Trade Practice - The Act says that, “unfair trade practice” means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice including any of the following practices, namely— 1.False representation: The practice of making any statement, whether orally or in writing or by visible representation which - a. falsely represents that the goods are of particular standard, quality, quantity, grade, composition, style or model; b. falsely represents that the services are of a particular standard, quality or grade; c. falsely represents any re-built, second-hand, renovated, reconditioned or old goods as new goods;
- 24. Consumer Protection Act-1986 d.represents that the goods or services have sponsorship, approval performance, characteristics, accessories, uses or benefits which such goods or services do not have; e. represents that the seller or the supplier has a sponsorship or approval or affiliation which such seller or supplier does not have; f. makes false or misleading statement concerning the need for, or the usefulness of, any goods or services; g.Gives any warranty or guarantee of the performance, efficacy or length of life of the goods, that is not based on an adequate or proper test thereof makes to the public a representation in a form that purports to be a warranty or guarantee of a product or of any goods or services; or a promise to replace, maintain or repair an article or any part thereafter or to repeat or continue a service until it has achieved a specified result, if such purported warranty or guarantee or promise is materially misleading or if there is no reasonable prospect that such warranty, guarantee or promise will be carried out. 2. False offer of bargain price: When an advertisement is published in a newspaper or anyother, whereby goods or services are offered at a bargain price but in real there is no intention that the same may be offered at that price, for a reasonable period or of reasonable quantity, it shall amount to an unfair trade practice. The ‘bargain price’, for this purpose means- the price stated in the advertisement in such manner as suggests that it is lesser than the ordinary price, or the price which any person coming across the advertisement would believe to be better than the price at which such goods are ordinarily sold.
- 25. Consumer Protection Act-1986 3.Free gifts offer and prize scheme: The unfair trade practices under this category are: Offering any gifts, prizes or other items along with the goods when the real intention is different, or Creating impression that something is being offered free alongwith the goods, when in fact the price is wholly or partly covered by the price of the article sold. 4. Non-Compliance of Prescribed Standards: Any sale or supply of goods intented to be used, or are of a kind likely to be used by consumers, knowing or having reason to believe that the goods do not comply with the standards prescribed by some competent authority, in relation to their performance, composition, contents, design, construction, finishing or packing, as are necessary to prevent or reduce the risk of injury to the person using such goods. * Restrictive Trade Practice : Restrictive trade practice means a trade practice which tends about manipulation of price or its conditions of delivery or to affect flow of supplies in the market relating to goods or service in such a manner so as to impose on the consumers unjustified costs or restrictions and shall include- (a) delay beyond the period agreed to be a trader in supply of such goods or in providing the services which has led or is likely to lead to rise in the price; (b) any trade practice which requires a consumer to buy, hire or avail of any goods or, as the case may be services as-condition precedent to buying, hiring or availing of other goods or services.
- 26. Consumer Protection Act-1986 CONSUMERPROTECTION COUNCILS Consumer Protection Councils are formed at 3 levels of the country. Central Council State Council District Council The objective of these councils is to promote and protect the rights of the consumers laid down in the consumer protection act. The Central Consumer Protection Council:- Composition The central council shall consist of the following members namely.The Minister in charge of Consumer Affairs in the central government will be the chairman of the Council.Such number of other official and non-official members representing such interests as may be prescribed.Procedures for meetings of the Central Council The central council shall meet as and when necessary, but at least one meeting of the council shall be held every year.The central council shall meet at such time as the chairman may think fit and shall observe such procedure in regard to the transaction of its business as may be prescribed.
- 27. Consumer Protection Act-1986 TheState Consumer Protection Councils:- Composition The state council shall consists of the following members namely. The minister in charge of consumer affairs in the state government who shall be its chairman. Such number of other officials or non-official members representing such interests as may be prescribed by the State Government. Such number of other official or non official members not exceeding ten as may be nominated by the central government. Procedures for meetings of the State Council. The state council shall meet as and when necessary but not less than two meetings shall be held every year. The state council shall meet at such time and place as the chairman may think fit and shall observe such procedure in regard to the transaction of its business as may be prescribed by the state government. The District Consumer Protection Council The state government shall establish for every district by notification a council to be known as the District consumer protection council with effect from such date as it may specify in such notification. Composition The collector of the district (hereinafter referred to as the District Council) shall consist of the following members namely:- The collector of the district who shall be its chairman. Such number of other official and non official members representing such interests as may be prescribed by the state government Procedures for meetings of the District Council The district council shall meet as and when necessary but not less than two meetings shall be held every year. The district council shall meet at such time and place within the district as chairman may think fit and shall observe such procedure in regard to the transaction of its business as may be prescribed by the state government. Objectives of the Council The objective of the Central/State/District Council shall be to promote and protect within the Nation (for central council)/ State (for state council)/ District (for district council) the rights of the consumers such as- The right to be protected against the marketing of goods and services which are hazardous to life and property; The right to be informed about the quality, quantity, potency, purity, standard and price of goods or services so as to protect the consumer against unfair trade practice; The right to be assured, wherever possible, access to a variety of goods and services at competitive prices;
- 28. Consumer Protection Act-1986 Theright to be heard and to be assured that consumer’s interest will receive due consideration at appropriate forums; The right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers The right to consumer’s education. DISPUTE SETTLEMENT THREE TIER MECHANISM The Consumer Protection Act provides for a three tier system of redressal agencies: District Level known as “District Forum” State Level known as “State Forum” National Level known as “National Forum” 1. District Forum A. Jurisdiction 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. B. Composition Its president shall be a person who is, has been, or is qualified to be a district judge appointed by State Government. Two other members, one of whom shall be a woman, who shall be not less than thirty five years of age, shall possess a bachelor’s degree from a recognized university and shall be persons of ability, integrity, and standing and have adequate knowledge and experience of atleast ten years in dealing with problems relating to economic, law, commerce, accountancy, industry, public affairs or administration. C.Terms of office- For 5 years or upto age 65 years whichever is earlier. A member shall be eligible or reappointment for another terms of five years within the specified age limit. 2. State Forum A. Jurisdiction
- 29. Consumer Protection Act-1986 Acomplaint is to be made to the state forum where the value of goods and services and compensation, if any, claimed is between 20 lakhs and 1 crore. B. Composition Its president shall be a person who is or has been a judge of high court appointed by the state government. Two other members, one of whom shall be a woman, who shall be not less than thirty five years of age, possess a bachelors degree from a recognized university and shall be 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 economic, law, commerce, accountancy, industry, public affairs or administration. C. Term of Office For 5 years or up to age of 67 years whichever is earlier. A member shall be eligible or reappointment for other terms of five years within the specified age limit. D.Circuit Benches The state commission shall ordinarily function in the state capital but may reform its function at such other place as the state government may in consultation with the state commission notify from time to time. 3.National Commission A. Jurisdiction A complaint is to be made to the National Commission for more than Rs 1crore. b. Composition Its president shall be a person who is or has been a judge of Supreme Court appointed by the central government.Not less than 4 and not more than such number of members and atleast one of them shall be a woman, who shall be not less than thirty five years of age, possess a bachelors degree from a recognized university and shall be 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 economic, law, commerce, accountancy, industry, public affairs or administration. c.Term of office Every member shall hold office for a term of 5 years or up to age of 70 years whichever is earlier. A member shall be eligible for reappointment for another terms of 5 years within the specified age limit. d. Circuit benches
- 30. Consumer Protection Act-1986 Thenational commission shall ordinarily function at New Delhi but may perform its functions at such other place as the central government may in consultation with the National Commission notify from time to time. When can a consumer launch a complain? Any unfair trade practice adopted by the trader. Defective goods. Deficiency in service. Excess price charged by the trader Unlawful goods sale, which is hazardous to life and safety when used etc. What can be nature of relief granted to a consumer? Repair of defective goods Replacement of defective goods. Refund of the price paid for the defective goods or service. Removal of deficiency in service. Refund of extra money charged. Withdrawal of goods hazardous to life and safety. Compensation for the loss or injury suffered by the consumer due to negligence of the opposite party. Adequate cost of filling and pursuing the complaint. To pay any amount (not less than 5% of the value of the defective goods or deficient services provided), to be credited to the Consumer Welfare Fund or any other organization/person, to be utilized in the prescribed manner.
- 31. Consumer Protection Act-1986 CASESTUDY: 1. CASE 1: A tale of two consumer rights Often, consumer complaints disappear into some galactic space and very rarely elicit a response. VandanaVasudevan I am in the sylvan campus of the National Law School, Bangalore where I am an invitee for a seminar on twenty-five years of the Consumer Protection Act. Here, I meet a bunch of young legal eagles in the fifth and final year of their study. As students of a course Consumer Law and Practice they present a most interesting paper, different from the scholarly work of the academics in the forum because it is completely experiential. A group of eight boys and girls used a set of popular cosmetics and found that every claim made in the advertisements for these products was untrue. They wrote to each of the manufacturers asking for explanations but did not get a halfway satisfactory response. They are now preparing to seek redressal in the district consumer forums. It brings us to the next two consumer rights after the right to safety and the right to information, in the series that began two weeks ago. These are: (a) The right to be heard and to be assured that consumer’s interests will receive due consideration at appropriate forums. (b) The right to seek redressal against unfair trade practices or unscrupulous exploitation of consumers. The law students I met exercised both these rights as follows: Vagish Kumar Singh used an entire tube of GarnierPowerlight, a men’s fairness moisturiser, endorsed by actor John Abraham, which claims to bestow lighter skin and contain “perlite”, a substance that ensures oil and sweat free skin. Vagish found that he was not in the least bit fairer after an entire tube was consumed. He wrote to the consumer helpline of Garnier asking for documentary scientific proof that shows the cream has these properties. When he got no response from them, he has written to the department of consumer affairs seeking third-party verification of the product’s claims. NamrataRamachandran used Nivea’s Energy Fresh which claims to prevent sweat and body odour for 48 hours. She and her team of two other classmates Aditya and Sounak found that this was not true. They wrote to Nivea asking them to show test results to prove their claim. The company responded asking for redundant details like when and where the product was purchased. The team is waiting till this week after which they are filing a case in the consumer court. They were bolstered by several Internet reviews criticizing the product for over-promising as the deodorant needed reapplication in 6-8 hours. Namrata’s point is that if there are particular conditions under
- 32. Consumer Protection Act-1986 whichthe deodorant will work for two days then they must be mentioned. Otherwise it is implied that a user of this product while travelling in May in Mumbai’s local train, will still smell like fresh lilies. Stocky and slightly chubby Shashank M. Patil tried VLCC’s Waist and Tummy trim gel whose claim is that fifteen years of research has shown that a person using this can lose upto 6 inches of waist fat within 3-6 weeks. Shashank’s tummy didn’t shrink an inch. Of course, there is a caveat on the cream that “conditions vary according to body type”. A German classmate, Marco Weiss, sent a sample of the cream to a Swiss lab and the test results too showed that the ingredients did not have any properties that can lead to slimming. So the boys called up the toll free number to ask some questions but got no response. Then they wrote an email asking for the research report relating to the cream’s efficacy and also how body type plays a role. They got no response, so they have sent VLCC a notice demanding redressal of their grievances (compensation and removal of advertisement). If they still don’t hear from them, they are approaching the courts. RaghavSrivastava tried Dove Damage Therapy Anti-dandruff shampoo. The ad claims that it contains zinc pyrithione (ZPTO) and a mystifying ingredient called “patented micro moisture serum”. Together they are supposed to wage war on the flaky stuff. The team found that the ad is misleading as ZPTO is an antifungal agent that acts on Malassezia fungi which is only one of the causes of dandruff. Dandruff has half a dozen causative factors, so the shampoo will possibly work only if this fungi is the cause. But this is obviously not mentioned in the pack. Raghav and team sent an email to the customer care asking some tough questions and got nothing but an automated reply. In each of the cases, the students, as consumers of the different products demanded that their grievance be heard and redressed satisfactorily, but their rights were not honoured. Only one team had better luck. Ritu Chandra and Johnathan, an exchange student from the National University of Singapore, tested the claims of fairness in four weeks promised by the Himalaya Fairness cream. They wrote on the website, phoned and emailed the company asking for proof of any study where this claim has been tested. They got a call from the head of the company’s legal department and a written response explaining the results of their study and asking for their product and purchase details. It doesn’t mean Himalaya Herbals claims are true. But the consumer’s right to be heard and redressed were upheld. The point of citing these instances in this week’s column is not the misleading claims and exaggerated promises. That is a separate story for another time. The reason I am citing the experiences of the students of National Law School is to show that consumers routinely write to companies whose products they find unsatisfactory. Often, the complaints disappear into some galactic space and very rarely elicit a response. We need to remember that this is a violation of two rights that we have as consumers—the right to be heard and the right to redressal.
- 33. Consumer Protection Act-1986 2.CASE 2: INDIAN MEDICAL ASSOCIATION V/S V.P. SHANTA AND OTHERS A three-Judge Bench of the Apex court considered the important question whether and, if so, in what circumstances, a medical practitioner could be regard d as rendering' service' under section 2( 1)( 0) of the Consumer Protection Act,1986 and whether the services rendered at a hospital/nursing home could also be regarded as 'service.' Relying upon it decision in Lucknow Development Authority v, M.K. Gupta. (1994) 1 SCC 243 (where it was held that the definition of 'service' in the Act was very wide), the Court rejected the argument that only 'occupation' and not 'profession' was covered within the term 'service' and so services rendered by medical practitioners were outside the purview of section 2(1)(o). It also rejected an alternate argument that 'service' contemplated under the Act was of the "institutional type which was really commercial enterprise open available to all who seek to avail thereof" Referring to section 14(1)(d) and section 2(1)(g), the Bench held that compensation for deficiency in service was to be awarded applying the same test as in an action for damages for negligence. it went on to observe that the standard of care that was required of medical practitioners was laid down in the English decision in Bolaml v Friern Hospital Management Committee 1(1957) 1AI/ ER 118] which had been accepted by the house of Lords and applied in a number of cases. Reference was also made to the Court'. earlier decision in Dr. LaxmanBalkrishna Joshi v Dr. TrimbakBapuGodbole& Another [(1969) 1 CR 206]. The Supreme Court repelled the contention that the Consumer Forum were not equipped to appreciate complex issues which might arise in cases of medical negligence and observed that these Forum were presided over by Judges/retired Judge who were well versed in law and, combined with lay decision making by members with knowledge and experience in various fields, the constitution of the Forum was adequate to deal with cases of medical negligence. Further, the safeguard of appeal against the orders of the Forum was available. The Court also did not agree that the summary procedure provided for in the Act was not sufficient to deal with such cases and observed that not every complaint would raise complicated questions. It also observed that in complaint' involving issues requiring recording of expert evidence, the Forum could ask the complainants to approach the civil court. It also noted that very few cases of medical malpractice had been filed till 1985, one of the reasons of which was the court fee payable in an action for damages (before civil courts) but no court fee was required to be paid under the Act, Holding medical practitioners, government hospitals/ Nursing homes and private hospitals/ nursing homes fell into three categories: (i) where services are rendered free of charge to everybody;
- 34. Consumer Protection Act-1986 (ii)Where charges are required to be paid by everyone; and (iii) Where charges are required to be paid by persons availing of services but certain categories of persons who could not afford to pay were rendered service free of charge, The Court laid down the following criteria: (i) Service rendered to a patient by a medical practitioner (except where the doctor rendered service free of charge to every patient or under a contract of personal service), by way of consultation, diagnosis and treatment, both medical and surgical, would fall within the ambit of 'service' as defined in section 2(1)(0) (ii) Merely because medical practitioners belong to medical profession and are subject to the disciplinary control of the Medical Council of India and / or state Medical Councils would not exclude the services rendered by them from the ambit of the Act (iii) A 'contract of personal service' was to be distinguished from a 'contact for personal services' (as only contract of personal service are expressly excluded from definition of service in section 2(1)(0). In the absence of relationship of master and servant between the patient and the medical practitioner; the service rendered by a medical practitioner to the patient would be under a 'contract for personal services and thus, is not outside section 2(1)(0), (iv) The expression 'contract of personal service' in section 2.(1)(0) of the Act could not be confined to contract for employment of domestic servants only and the expression would include the employment of a medical officer for the purpose of rendering medical service to the employer. However, such service would be would be outside the purview of section2 (1)( 0). (v) Service rendered free of charge by a medical practitioner attached to a hospital/nursing home or a medical officer employed in a hospital/nursing home where such service were rendered free of charge to everybody would not be 'service' as defined in section 2(1)(0). The payment of a token amount only for registration purpose at the hospital/nursing home would not alter the position. (vi) Similarly, service rendered at a non-Government hospital/nursing home where no charge whatsoever was made from any person availing of the service and all patients (rich and poor) were given free service was outside the purview of tile expression 'service.' The payment of a token amount only for registration purpose only at such a hospital/nursing home would not alter the position.
- 35. Consumer Protection Act-1986 (vii)Service rendered at a non-Government hospital/nursing home where charges were required to be paid by all persons availing of such services fell within the purview of the expression 'service' as defined in section2(1)(o). (viii) Service rendered at a non-Government hospital/nursing home where charges were required to be paid by persons who were in a position to pay and persons who could not afford to pay were rendered service free of charge would fall within 'service' as defined in section 2(1)(0). Free service rendered to those who could not pay would also be ‘service’ and the recipient a 'consumer' under the Act. In arriving at this conclusion, the Court opined that a) The protection envisaged under the Act was for consumers as a class; b) Otherwise, it would mean that the protection of the Act would be available to only those who could afford to pay and not to the poor, although the poor required the protection more; and c) Else the standard and quality of service rendered at an the establishment would cease to be uniform. (ix) Service rendered at a government hospital/health centre/dispensary where no charge whatsoever was made from any person availing of the services and all patients (rich and poor) were given free service was outside the purview of the expression 'service' as defined in section 2(1)(0) of the Act The payment of a token amount for registration purpose only at the hospital/nursing home would not alter the position. (x) Service rendered at a Government hospital/health centre/dispensary where services were rendered to some persons on payment of charges and also rendered free of charge to other persons would fall within 'service' as defined in section 2(1)(0). Free Service to those who could not pay would also be 'service' and the recipient a 'consumer' under the Act. Though Governmental hospitals may not be commercial in the sense of private doctors and hospitals, Government hospitals could not be treated differently and in such a case the persons belonging to 'poor class' received free services would be the beneficiaries of the services hired/ availed of by the 'paying class.' (xi) Service rendered by a medical practitioner or hospital/nursing home could not be regarded a service rendered free of charge if the person availing of the service had taken an insurance policy for medical care where under the charge for consultation, diagnosis and medical treatment were borne by the insurance company. It would fall within 'services" as defined in section 2(1)(0). (xii) Similarly, where, a part of the condition of services', the employer bore the expenses of medical treatment of an employee and his family members dependent on him the service rendered to such an employee and his family members by a medical practitioner or a hospital/nursing home would constitute 'service' under the Act.
- 36. Consumer Protection Act-1986 3.CASESTUDY 03:- Cinemas, theatre and other places of public entertainment generally overcharge customers. This is rampant, but rarely does a consumer take action. Here is a case where a consumer took on the mighty Reliance Media Works, and succeeded in asserting consumer rights. Manoj Kumar went for movie at Big Cinemas, Jaipur, run by Mumbai-based Reliance Media Works. He brought a Aquafina water. The printed price showed an MRP of Rs16, but Manoj was charged Rs-30. The bill gave a break up of Rs-26/09 for the water and Rs-3/91 as taxes. Manoj was upset at being overcharged, and asked for the complaint book, but it was not provided. Manoj filed a complaint before the district forum. Reliance opposed the complaint, contending that the bottles were purchased from Varun Bevarages, with a printed MRP OF Rs-30, approved by Aquafina Pepsico Company. These bottles had a higher MRP as they were meant for sale in cinema halls, while regular ones for “ordinary people” sold in “ordinary shop” had an MRP of Rs-16. However, no proof was furnished in support of this. The forum upheld Manoj’s complaint and directed the cinema hall to refund the excess amount of Rs-14. In addition, Rs-5000 was awarded as compensation for mental agony and Rs-1500 towards litigation costs. Reliance challenged this order before the Rajasthan State Commission, but the appeal was dismissed. Reliance then filed a revision petition, claiming that there was adequate provisions for free drinking water and nobody was forced to purchase bottled water. Manoj has purchased it from local shop and has filed a false and frivolous complaint. The commission observed that the main questions were whether a service provider could charge more than the MRP, and whether cinema halls can have a special MRP different from the ordinary MRP. The commission noted that no evidence had been produced by Reliance to show that it had sold a bottle of water bearing a special MRP. It observed that Manoj appeared to be innocent and a whistleblower who would not allow cinema halls to repeatedly commit illegalities, and wanted to bring such malpractices to an end. It rejected Reliance’s argument that Manoj was not a consumer and that it was permissible to charges more than the MRP in view of a Delhi high court judgment in Delhi Gymkhana club v/s Union of India. The commission observed that Pepsico was making contrary submission by stating that its Aquafina bottles were priced at Rs-16, but it was permissible to have two different MRPs. So they warned Pepsico to have only one MRP, and stated that it would not allow such a practice to overcharge people.
- 37. Consumer Protection Act-1986 Accordingly,by its judgement of February 1, delivered by justice J M Malik for the bench along with DR S M Kantikar, the commission upheld the decision of holding Reliance liable. In addition, the commission saddled Reliance with further deterrent cost of Rs-5 lakhs for illegal enrichment by charging and extorting money from their customers. This amount would have to be deposited in the commission’s Legal Aid Account within 90 days, or with 9% interest if delayed. Impact: Overcharging consumers is not permissible. Earlier, in another case, the Maharashtra state commission had ruled dual pricing would constitute an unfair trade practice. GOVERNMENT INITIATIVES FOR PROTECTION OF CONSUMER RIGHTS & STATISTICS Government has taken number of initiative to create consumer awareness . It includes public campaign like Jago Grahak Jago , 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. Also Telecast of video spots in north eastern states, Megh doot postcards, Printed literature, Exhibition in Indian science congress at shilling, Nukkad natak contest 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. “JAGO GRAHAK JAGO” SCHEME OF GOVT. OF INDIA "The customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption on our work. He is the purpose of it. He is not an outsider on our business. He is part of it. We are not doing him a favour by serving him. He is doing us a favour by giving us an opportunity to do so." - MAHATMA GANDHI Consumer is the real deciding factor for all economic activities. It is now universally accepted that the extent of consumer protection is a true indicator of the level of progress in a nation. The growing size and complexity of production and distribution systems, the high level of sophistication in marketing and selling practices and forms of promotion like advertising, etc. have contributed to the increased need for consumer protection.
- 38. Consumer Protection Act-1986 JagoGrahak Jago The slogan 'Jago Grahak Jago' has now become a household name as a result of the publicity campaign undertaken in the last 5 years. Through the increased thrust on consumer awareness in the XIth Five Year Plan, the Government has endeavoured to inform the common man of his rights as a consumer. As part of the consumer awareness scheme, the rural and remote areas have been given the top priority. PARTICIPATION IN INDIA INTERNATIONAL TRADE FAIR Keeping in view the large number of visitors to India International Trade Fair, the Department displayed its activities through a stall in IIPA. Publicity material regarding main provisions of Consumer Protection, Standardization, Weights & Measures, ISI, Hall Marking and other issues of consumer interest was distributed free of cost. On the spot guidance was also given to consumers during the Trade Fair. Joint Campaign ‘Jago Grahak Jago’ has become the focal theme through which issues concerning the functioning of almost all Government Departments having a consumer interface can been addressed. To achieve this objective joint campaigns have been undertaken/are being undertaken with a number of Government Departments. The Department had run a joint campaign with Bureau of Energy Efficiency to educate people about energy conservation by having awareness of the BEE star labels. A joint campaign with National Pharmaceuticals Product Authority is being devised to educate consumers about the various issues concerning pharma industry. Similarly, campaigns with Reserve Bank of India, FICCI, Ministry of Urban Development (for real estate sector) and HRD (for education sector) are being planned.
- 39. Consumer Protection Act-1986 1.ConfoNet: Confonetstands for Computerization and Computer Networking of Consumer Fora in Country. It is an internet based Case Monitoring System developed for automating the work flow of the consumer forums, starting from case registration until announcement of judgment.Objective of ConfoNet: The project aims at improving operational efficiency, co-ordination, accessibility, speed in judicial administration and to set Information Communication Technology (ICT) infrastructure at Consumer Redressal forums all over India. It aims at providing: E- Governance, Efficiency, Transparency, Systematizing of working and to achieve time bound delivery of justice to the consumers. The government has finalized a mechanism for giving rate card to the forums based on their scores calculate keeping in mind speed of disposal of cases, period of adjournment, number of adjournment and average time taken for admission This is one of several steps that government is taking to revamp the consumer forums, more so after Prime Minister Narendra Modi asked consumer affairs ministry to strengthen these forums since these are "window to justice for the poor" 2. National Consumer Helpline: At the present time, economy’s king is to be considered only the consumers. India’s government had wide range of forum in order to promote and protect the interests and rights of the consumers in all over the India. Today, there were lots of forums organized by the India’s government where anyone consumer can submit their complaints if they were be victim in any of the unfair part or they were cheated by anyone or more. Government of India has launched the laws that prevent the consumers from being cheated and fraud by anyone. To protect all rights of the consumers, on 24th December 1986, a law of Consumer Protection Act had been launched by the Parliament of the India. By the 15th March 2003, a new version of Act came into existence replacing the old with more modifications. Government has set the judicial system at the level of central, district and state for hearing of the grievances and disputes of the consumers. Presently, about total of 35 State Forums, Commission Center of National Consumer Redressal and Disputes, total of 629 District Forums are present. In order to report the problems of the consumers, a 24 x 7 Customer Care Number is provided by the National Consumer Helpline in order to cure the problem or in order to provide the advice to the consumer regarding different services like related to water, medical, education, electricity, courier, telecom, credit cards, LPG, automobiles, banking, hospitality, telecom, home appliances, postal, and transport etc. NCH is a project of the Union Ministry of Consumer Affairs, operating from the University of Delhi. The project recognizes the need of consumers for a Telephone Helpline to deal with a multitude of problems arising in their day-to-day dealings with business and service providers. A consumer can call to seek information, advice or guidance for his queries, complaints and guidance.
- 40. Consumer Protection Act-1986 NationalConsumer Helpline supports consumers by: * Guiding consumers in finding solutions to problems related to Products & Services. * Providing information related to Companies and Regulatory Authorities. * Facilitating consumers in filing complaints against defaulting Service Providers * Empowering consumers to use available Consumer Grievances Redressal Mechanisms, Educating Consumers about their Rights and Responsibilities 3. CORE Centre: Consumer Online Resource & Empowerment Centre is formed by Consumer Coordination Council (CCC) with a mission to be an effective national coalition of consumer protection groups so as to provide thrust to common issues affecting consumers Aims & Objectives * Influencing policies, legislation and administrative framework towards promoting consumer interests. * Empowering consumer protection groups to work towards strengthening the civil society in the democratic system of the country. One of the major concerns of CCC has been Good Governance. CCC had accordingly launched a National Campaign on Citizens’ Charter in July 1996 for implementing the principles of Transparency, Accountability, Standards of Service, Availability of Information and an Effective Grievance Redressal System in Public Service and has been continuing its pioneering work in this direction
- 41. Consumer Protection Act-1986 StatisticalData: Total Number of Consumer Complaints Filed / Disposed since inception Under Consumer Protection Law. Source: National Consumer Disputes Redressal Commission Sex-wise Family Members of the Households Sex(M/F) Family Members Average family Size Male 200 2.5 Female 220 2.75 Total 420 5.25 Sl. no Name of Agency Cases files since inception Cases disposed of since inception Cases pending % of total disposal 1. National commission 98063 88031 10032 89.77% 2. State commission 694546 598477 96069 86.17% 3. District Forums 3650986 3365999 284987 92.19% Total 4443595 4052507 391088 91.20%
- 42. Consumer Protection Act-1986 OccupationalStatus of the Head of Households Occupation No. of Households Percentage (%) Services 68 85 Big Business 02 2.5 Small Business 10 12.5 Total 80 100 Income Level of the Households Income level No. of Households Percentage(%) Below 5000(Low) 10 12.5 5000-20000(Medium) 60 75 20000-and above(High) 10 12.5 Total 80 100
- 43. Consumer Protection Act-1986 ROLEOF NON-GOVERNMENTAL ORGANIZATIONS Non- Governmental Organizations (NGOs) are those associations of people, which aim at promoting the welfare of the public, without any profit motive. They are voluntary bodies, having a constitution and rules of their own, and are free from government interference. They depend on donations and partly on government assistance. NGOs dealing with consumer problems are known as consumer associations or consumer organizations. The role of NGOs has become increasingly more significant over the last two decades. There are now more than 800 such organizations in India. These organizations are registered under the Societies Registration Act or the Companies Act or as Charitable Trusts. NGOs have undertaken various activities as part of the consumer movement. They perform several functions, namely, * Create awareness about consumer rights and educate the general public about consumer problems and remedies through seminars, workshops and training programmes. * Provide legal aid to consumers by way, of assistance in seeking legal remedy. * Undertake advocacy of consumers' point of view as representative members of consumer protection councils and others official boards. * Arrange comparative testing of consumer products through their own testing apparatus or accredited laboratories so as to evaluate the relative qualities of competing brands and publish the test results for the benefit of consumers to become informed buyers. * Publish periodicals and journals to disseminate information among readers about consumer problems, legal reporting and other emerging matters of interest. Most of these periodicals do not accept advertisements from business firms. * Make suggestions and recommend steps, which government authorities should consider in policy making and administrative measures adopted in the interest of consumers. * Some NGOs have successful used Public Interest Litigation (PIL) to enforce consumer rights in several cases. In other words, NGOs have filed cases in law courts in the interest of the general public, not for any individual.
- 44. Consumer Protection Act-1986 CONCLUSION: Eventhough strong and clear laws exist in India to protect consumer rights, the actual Indian consumers could be declared as completely dismal. Very few consumers are aware of their rights or understand their basic consumer rights. Of the several laws that have been enacted to protect the rights of consumers in India, the most significant is the Consumer Protection Act, 1986. Under this law, everyone, including individuals, a Hindu undivided family, a firm, and a company, can exercise their consumer rights for the goods and services purchased by them. It is important that, as consumers, we know at least our basic rights and about the courts and procedures that deal with the infringement of our rights. Therefore, Consumer protection act is made to make the consumer aware of their rights and to establish high level ethical conducts for those engaged in production and distribution of goods and service. An as now a days consumer is the forgotten man of the modern Indian economy. He is generally taken for granted who has no alternative then to buy, inorder to survive in the society. He has to face number of problems day in and day out. Some of these problems are in the nature of unfair trade practices, high price, duplicate articles, under weigh and under measurement, rough behaviours, undue condition are some ways by which consumers are exploited by manufacturers and traders. Limited information and low literacy rate has also cause exploitation of consumers. The consumers have to be aware not only of the commercial aspects of the sale and purchase of the goods, but also of the health and security aspects. Food safety has become an important element of consumer rights awareness and depends not only on its nutritional value, but also on its safety for human consumption. Modern technological have also made a great impact on impact on the quality, availability and safety of goods and service. Due to the total helplessness of the consumer in the corporate sector with its vast resources and control over the media, it has been found necessary to devise new method of regulation and control. Corruptions at all stages has also let the traders to go scot free and unpunished. Therefore, Consumer protection act is most vital to society and a way to eliminate malpractices by the manufacturers, producers, and marketers. The efficient and effective programme of Consumer Protection is of special significance to all of us because we all are consumers. Even a manufacturer or provider of a service is a consumer of some other goods or services. If both the producers/ providers and consumers realize the need for co-existence, adulterated products, spurious goods and other deficiencies in services would become a thing of the past. The active involvement and participation from all quarters i.e. the central and state governments, the educational Institutions, the NGO’s, the print and electronic media and the adoption and observance of a voluntary code of conduct by the trade and industry and the citizen’s charter by the service providers is necessary to see that the consumers get their due. The need of the hour is for total commitment to the consumer cause and social responsiveness to consumer needs. This should, however, proceed in a harmonious manner so that our society becomes a better place for all of us to live in.
- 45. Consumer Protection Act-1986 Consumerprotection 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. We should educate consumers to develop an understanding about their responsible as consumers. Consumers should organize together to develop the strength and influence to promote and promote and protest their own interest. Government should make the implement rules of punishment more harsh so that manufacturer and the shopkeeper think twice before adopting fraudulent practices. A campaign should be set in order to involve each and every consumer for making them mofre conscious and aware of their rights and responsilbility. 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. Thus, Consumer Protection Act, 1986 and various other laws have been formulated to ensure fair competition in the market place and free flow of true information from the providers of goods and services to those who consume them. However, the success of these laws would depend upon the vigilance of consumers about their rights, as well as their responsibilities. In fact, the level of consumer protection in a country is considered as the correct indicator of the extent of progress of the nation. So, in the era of free competition where "consumer is king", as consumers we need to be aware of our rights and seeks redressal where the quality of product and services is not as per expectation. The cases illustrate that there is indeed a need for protection of consumer rights. The consumer protection act is therefore a tool that provides a mechanism for redressal where these rights are not honored. To sum up just include the following: 1. The consumers are generally not aware of their rights and duties. 2. This allows the producers to cheat the consumers and gain profit. 3. The government does very little to make the consumer aware. 4. The court procedures take a very long time and money required. 5. The consumers often forget to obtain a cash memo of the purchase. 6. The consumer may also be cheated by the sellers as they are not aware of the M.R.P. The efficient and effective programme of Consumer Protection is of special significance to all of us because we all are consumers. Even a manufacturer or provider of a service is a consumer of some other goods or services. If both the producers/ providers and consumers realize the need for co-existence, adulterated products, spurious goods and other deficiencies in services would become a thing of the past. The active involvement and participation from all quarters i.e. the central and state governments, the educational Institutions, the NGO’s, the print and electronic media and the adoption and observance of a voluntary code of conduct by the trade and industry and the citizen’s charter by the service providers is necessary to see that the consumers get their due. The need of the hour is for
- 46. Consumer Protection Act-1986 totalcommitment to the consumer cause and social responsiveness to consumer needs. This should, however, proceed in a harmonious manner so that our society becomes a better place for all of us to live in. 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 themselves in the market place. Thus, in the era of free competition where "consumer is king", as consumers we need to be aware of our rights and seeks redressal where the quality of product and services is not as per expectation. The cases illustrate that there is indeed a need for protection of consumer rights. The consumer protection act is therefore a tool that provides a mechanism for redressal where these rights are not honored. WEBLIOGRAPHY http://cgsiindia.org/ http://www.archive.india.gov.in/spotlight/spotlight_archive.php?id=97#tab=tab-1 http://ncdrc.nic.in/statistics.html Book name- Business Law by Tejpal Sheth Case study from Times of India - 29Feb 2016
- 47. Consumer Protection Act-1986 Historyof consumer protection act In ancient time, human values were cherished and ethical practices were considered of great importance. It is made to discuss the legal framework of the Indian consumer protection act of 1986 which led to the evolution of a new legal culture in India. All sections of society followed Dharma-sastras(Dharma) which laid out social rules and norms, and served as the guiding principle governing human relations. The principle of dharma derived from Vedas. Vedas were considered the words of god, and law was said to have divine origin which was transmitted to society and Vedas was the primary sources to India. However, the Indian legal system experienced a revolution with the enactment of the consumer protection act of 1986which was specifically designed to protect consumer interest. It is intended to provide justice which is less formal and involves less paper work and less expense. The consumer protection act simply gives a new dimension to rights that have been recognized and protected since the ancient period. And it is rightly said that”the present day “ is concern for consumer rights. Hence,consumer has the right to safety and consumer also has the right to protect himself against any injustice and it is a fact that we all know that consumer is the king of the market. Always a matter of great concern.in ancient india,effective measure were initiated to protect the consumer from crimes in market place.ancient law givers ably described various inds of unfair trade practices and also prescribed severe punishment for wrong doers.