Chapter 12

CONSUMER PROTECTION

THE CONSUMER PROTECTION ACT, 2019

 The Consumer Protection Act, 2019 seeks to protect and promote the interests of consumers.
 The Act provides safeguards to consumer against defective goods, deficient services, unfair trade
practices, and other forms of their exploitation.
 The Act provides for the setting up of three-tier machinery, consisting of District Forums, State
Commissions and the National Commission.
 It also provides for the formation of consumer protection councils in every District and State, and at
the apex level.
 The scope of the Act is very wide. It is applicable to all types of undertakings, big and small, whether
in the private or public sector, or in the co-operative sector, whether a manufacturer or a trader, and
whether supplying goods or providing services.
 A consumer is said to be a king in a free market economy.
 The earlier approach of caveat emptor, which means “Let the buyer beware”, has now been
changed to caveat venditor (“Let the seller beware”).

 The Consumer Protection Act 2019 has replaced the Act 1986 and seeks to widen its scope in
addressing consumer concerns.

SCOPE OF CONSUMER PROTECTION

The concept of consumer protection is to safeguard the interests of the consumers. It adopts measures to
protect consumers from unethical malpractices by businesses and provide a swift redressal of their
grievances with regard to:

1. Sale of adulterated goods such as adding inferior substances to the product being sold.
2. Sale of counterfeit goods such as selling a product of lesser value than the real product.
3. Sale of sub-standard goods such as the sale of products that do not meet the prescribed quality
standards.
4. Sale of duplicate goods.
5. Use of malfunctioning weights and measures that lead to underweight of products.
6. Black marketing and hoarding that eventually leads to scarcity of the product and well as a rise in
the price of the same.
7. Overcharging a product, i.e., charging a product above its Maximum Retail Price.
8. Supplying of defective goods.
9. Advertisements that are misleading, i.e., advertisements that falsely claim a product or a service to
be shown as superior quality, grade or standard when not in real.
10. Supply of inferior services, i.e., quality of service lesser than the condition agreed.

Consumer Protection Page 1 of 9

 B.St. Notes - XII Consumer Protection

Need for Consumer Protection

The need for consumer protection arises from the need to protect consumers from the loss or injury or other
prevailing malpractices and to ensure:
1. Physical safety of a consumer.
2. Access to information.
3. Corporate Social Responsibility to provide quality and quantity of goods at fair prices.
4. Consumer satisfaction.
5. Social justice and Trusteeship.
6. Survival and the Growth of businesses.

IMPORTANCE OF CONSUMER PROTECTION

From Consumers’ point of view

(i) Consumer Ignorance:

 In the light of widespread ignorance of consumers about their rights and reliefs available to them, it
becomes necessary to educate them about the same so as to achieve consumer awareness.

(ii) Unorganised Consumers:

 Consumers need to be organised in the form of consumer organisations which would take care of
their interests.
 Though, in India, we do have consumer organisations which are working in this direction, adequate
protection is required to be given to consumers till these organisations become powerful enough to
protect and promote the interests of consumers.

(iii) Widespread Exploitation of Consumers:

 Consumers might be exploited by unscrupulous, exploitative and unfair trade practices like defective
and unsafe products, adulteration, false and misleading advertising, hoarding, black-marketing etc.
Consumers need protection against such malpractices of the sellers.

From the point of view of Business

(i) Long-term Interest of Business:

 Enlightened businesses realise that it is in their long-term interest to satisfy their customers.

 Satisfied customers not only lead to repeat sales but also provide good feedback to prospective

customers and thus, help in increasing the customer-base of business.

 Thus, business firms should aim at long-term profit maximization through customer satisfaction.

(ii) Business uses Society’s Resources:

 Business organisations use resources which belong to the society.

Consumer Protection Page 2 of 9

 B.St. Notes - XII Consumer Protection

 They, thus, have a responsibility to supply such products and render such services which are in

public interest and would not impair public confidence in them.

(iii) Social Responsibility:

 A business has social responsibilities towards various interest groups.

 Business organisations make money by selling goods and providing services to consumers.

 Thus, consumers form an important group among the many stakeholders of business and like other

stakeholders, their interest has to be well taken care of.

(iv) Moral Justification:

 It is the moral duty of any business to take care of consumer’s interest and avoid any form of their

exploitation.

 Thus, a business must avoid unscrupulous, exploitative and unfair trade practices like defective and

unsafe products, adulteration, false and misleading advertising, hoarding, black marketing etc.

(v) Government Intervention:

 A business engaging in any form of exploitative trade practices would invite government intervention

or action. This can impair and tarnish the image of the company.

 Thus, it is advisable that business organisations voluntarily resort to such practices where the

customers’ needs and interests will well be taken care of.

 In view of the above, the government of India has enacted several regulations designed to provide

adequate protection to consumers. We shall now discuss some of these regulations.

CONSUMER RIGHTS
The Consumer Protection Act provides for six rights of consumers. These rights include the following:
1. Right to Safety:
 The consumer has a right to be protected against goods and services which are hazardous to life
and health.
 For instance, electrical appliances which are manufactured with substandard products or do not
conform to the safety norms might cause serious injury.
 Thus, consumers are educated that they should use electrical appliances which are ISI marked as
this would be an assurance of such products meeting quality specifications.
2. Right to be Informed:
 The consumer has a right to have complete information about the product he intends to buy
including its ingredients, date of manufacture, price, quantity, directions for use, etc.

Consumer Protection Page 3 of 9

 B.St. Notes - XII Consumer Protection

 It is because of this reason that the legal framework in India requires the manufactures to provide
such information on the package and label of the product.
3. Right to be assured:
The consumer has the freedom to access variety of products at competitive prices. This implies that
the marketers should offer a wide variety of products in terms of quality, brand, prices, size, etc. and
allow the consumer to make a choice from amongst these.
4. Right to be Heard:
 The consumer has a right to file a complaint and to be heard in case of dissatisfaction with a good
or a service.
 It is because of this reason that many enlightened business firms have set up their own consumer
service and grievance cells.
 Many consumer organisations are also working towards this direction and helping consumers in
redressal of their grievances.
5. Right to seek Redressal:
 The consumer has a right to get relief in case the product or service falls short of his expectations.
 The Consumer Protection Act provides a number of reliefs to the consumers including replacement
of the product, removal of defect in the product, compensation paid for any loss or injury suffered by
the consumer, etc.
6. Right to Consumer Education:
 The consumer has a right to acquire knowledge and to be a well informed consumer throughout life.
 He should be aware about his rights and the reliefs available to him in case of a product or service
falling short of his expectations.
 Many consumer organisation and some enlightened businesses are taking an active part in
educating consumers in this respect.
 The Consumer Protection Act by conferring these rights on the consumers empowers them to fight
against any unscrupulous, exploitative and unfair trade practices adopted by sellers.

CONSUMER RESPONSIBILITIES
A consumer should keep in mind the following responsibilities while purchasing, using and consuming
goods and services.
(i) Be aware about various goods and services available in the market so that an intelligent and wise
choice can be made.
(ii) Buy only standardised goods as they provide quality assurance. Thus, look for ISI mark on electrical
goods, FPO mark on food products, Hallmark on jewelry etc.
(iii) Learn about the risks associated with products and services, follow manufacturer’s instructions and
use the products safely.
(iv) Read labels carefully so as to have information about prices, net weight, manufacturing and expiry
dates, etc.
(v) Assert yourself to ensure that you get a fair deal.

Consumer Protection Page 4 of 9

 B.St. Notes - XII Consumer Protection

(vi) Be honest in your dealings. Choose only from legal goods and services and discourage
unscrupulous practices like black-marketing, hoarding etc.
(vii) Ask for a cash memo on purchase of goods or services. This would serve as a proof of the
purchase made.
(viii) File a complaint in an appropriate consumer forum in case of a shortcoming in the quality of goods
purchased or services availed. Do not fail to take an action even when the amount involved is small.
(ix) Form consumer societies which would play an active part in educating consumers and safeguarding
their interests.
(x) Respect the environment. Avoid waste, littering and contributing to pollution. A consumers’
awareness about his rights and responsibilities is just one of the ways in which the objective of
consumer protection can be achieved. There are other ways in which this objective may be
achieved.

Consumer

 A ‘consumer’ is generally understood as a person who uses or consumes goods or avails of any
service.
 Under the Consumer Protection Act 2019, a consumer is a person who buys any goods or avails
services for a consideration, which has been paid or promised, or partly paid and partly promised, or
under any scheme of deferred payment.
 It includes any user of such goods or beneficiary of services if such use is made with the approval of
the buyer.
 It applies to both offline and online transactions through electronic means or by teleshopping or
direct selling or multilevel marketing.
 However, any person who obtains goods or avails services for resale or commercial purpose is not
treated as a consumer and is outside the scope of Consumer Protection Act 2019.

A ‘consumer’ is generally understood as a person who uses or consumes goods or avails of any service. Under the Consumer
Protection Act, a consumer is defined as:
(a) Any person who buys any goods for a consideration, which has been paid or promised, or partly paid and partly promised, or
under any scheme of deferred payment. It includes any user of such goods, when such use is made with the approval of the buyer,
but does not include a person who obtains goods for re-sale or any commercial purpose.
(b) Any person who hires or avails of any service, for a consideration which has been paid or promised, or partly paid and partly
promised, or under any system of deferred payment. It includes any beneficiary of services when such services are availed of with
the approval of the person concerned, but does not include a person who avails of such services for any commercial purpose.

Who can file a complaint?

A complaint before the appropriate consumer forum can be made by:
(i) Any consumer;
(ii) Any registered consumers’ association;
(iii) The Central Government or any State Government;
(iv) One or more consumers, on behalf of numerous consumers having the same interest; and
(v) A legal heir or representative of a deceased consumer.

Consumer Protection Page 5 of 9

 B.St. Notes - XII Consumer Protection

REDRESSAL AGENCIES UNDER THE CONSUMER PROTECTION ACT

Redressal Agencies under the Consumer Protection Act

1. District Commission:
 District commission has a jurisdiction to entertain complaints where value of goods or services paid
as consideration does not exceed one crore rupees.
 Either on the first hearing or at any later stage, it appears to district commission that there exists
elements of settlement which may be acceptable to the parties, it may direct them to give their
consent for settlement of dispute through mediation within five days.
 In case the parties agree for settlement by mediation and give written consent, the district
commission refers the matter for mediation and the provisions relating to mediation shall apply.
 However, in the event of failure of settlement by mediation proceeds with the complaint.
 If the complaint alleges defect in goods which cannot be determined without proper analysis or test
of goods, the commission obtains the sample of goods, seal it and refer to the appropriate authority
for analysis.
 In case of services, the dispute is settled based on the basis of evidence brought to its notice by the
complainant and can ask for any required information document or records from the service provider
for settlement.
 If any of the parties are not satisfied by the order of District Commission can appeal against such
order to the State Commission on the grounds of facts or law within a period of forty-five days from
the date of order.

2. State Commission:
 It is established by the respective state government and ordinarily function at the state capital.
 State Commission has a jurisdiction to entertain complaints where value of goods and services paid
as consideration exceeds one crore but does not exceed ten crore rupees.
 If any of the parties are not satisfied by the order of State Commission can appeal against such
order to the National Commission within a period of thirty days of such order.

3. National Commission:
 The National Commission has territorial jurisdiction over the whole country.
 National Commission has a jurisdiction to entertain complaints where value of goods or services
paid as consideration exceeds ten crores of rupees.
 If any of the parties are not satisfied by the order of National Commission can appeal against such
order to the Supreme Court of India within a period of thirty days of such order.

 An order passed by the National Commission in a matter of its original jurisdiction is appealable before the
Supreme Court.
 This means that only those appeals where the value of goods and services in question, along with the
compensation claimed, exceeds ten crores of rupees and where the aggrieved party was not satisfied with
the order of the National Commission, can be taken to the Supreme Court of India.
 Moreover, in a case decided by the District Forum, the appeal can be filed before the State Commission and,
thereafter, the order of the State Commission can be challenged before the National Commission and no
further.
Consumer Protection Page 6 of 9
 B.St. Notes - XII Consumer Protection

Relief Available
If the consumer court is satisfied about the genuineness of the complaint, it can issue one or more of the
following directions to the opposite party.
(i) To remove the defect in goods or deficiency in service.
(ii) To replace the defective product with a new one, free from any defect.
(iii) To refund the price paid for the product, or the charges paid for the service.
(iv) To pay a reasonable amount of compensation for any loss or injury suffered by the consumer due to
the negligence of the opposite party.
(v) To pay punitive damages in appropriate circumstances.
(vi) To discontinue the unfair/ restrictive trade practice and not to repeat it in the future.
(vii) Not to offer hazardous goods for sale.
(viii) To withdraw the hazardous goods from sale.
(ix) To cease manufacture of hazardous goods and to desist from offering hazardous services.
(x) Compensate for any loss or injury suffered by consumer under product liability action and withdraw
hazardous products from being offered for sale etc.

ROLE OF CONSUMER ORGANISATIONS AND NGOS

In India, several consumer organisations and non-governmental organisations (NGOs) have been set up for
the protection and promotion of consumers’ interests. Non-governmental organisations are non-profit
organisations which aim at promoting the welfare of people. They have a constitution of their own and are
free from government interference. Consumer organisations and NGOs perform several functions for the
protection and promotion of interest of consumers. These include:
(i) Educating the general public about consumer rights by organising training programmes, seminars
and workshops.
(ii) Publishing periodicals and other publications to impart knowledge about consumer problems, legal
reporting, reliefs available and other matters of interest.
(iii) Carrying out comparative testing of consumer products in accredited laboratories to test relative
qualities of competing brands and publishing the test results for the benefit of consumers.
(iv) Encouraging consumers to strongly protest and take an action against unscrupulous, exploitative
and unfair trade practices of sellers.
(v) Providing legal assistance to consumers by way of providing aid, legal advice etc. in seeking legal
remedy.
(vi) Filing complaints in appropriate consumer courts on behalf of the consumers.
(vii) Taking an initiative in filing cases in consumer courts in the interest of the general public, not for any
individual.
Some of the important consumer organisations and NGOs engaged in protecting and promoting consumers’
interests include the following: (learn any two)
(i) Consumer unity and Trust Society (CuTS), Jaipur. (ii) Common Cause, Delhi
(iii) Voluntary Organisation in Interest of Consumer Education (VOICE), Delhi,
(iv) Consumer Education and Research Centre (CERC), Ahmadabad
(v) Consumer Protection Council (CPC), Ahmadabad; (vi) Consumer Guidance Society of India (CGSI), Mumbai
(vii) Mumbai Grahak Panchayat, Mumbai; (viii) Karnataka Consumer Service Society, Bangalore
(ix) Consumers’ Association, Kolkata; (x) Consumer Coordination Council, Delhi.

Consumer Protection Page 7 of 9

 B.St. Notes - XII Consumer Protection

TEST YOUSELF ASSIGNMENT

1. Identify the importance of consumer protection highlighted from the following statements:
i. It is the duty of any business to take care of consumer's interest and avoid any form of their exploitation.
ii. Business involve in any unfair trade practices would invite government action.
iii. Consumers need protection against various types of malpractices of the sellers.
iv. In Indian, consumers are ignorant about their rights and reliefs available to them.
v. Business firms should aim at long-term profit maximisation through customer satisfaction.
vi. In India, we do have consumer organisations which are working in the field of educating consumers
about their rights and promoting their interests.
vii. It is the responsibility of business enterprise to supply such products and such services which are in
public interest.
viii. A business enterprise should discharge its social responsibilities.
2. Grahak Shakti', and N.GO. organised a workshop to discuss various issues relating to consumers.
During the discussion, one of the members drew attention towards exploitation of consumers due to
defective and unsafe products, adulteration, black marketing, hoarding etc. To this another member
argued that consumers themselves are responsible as they do not raise collective voice against the
exploitation. The chairperson of the organisation was of the opinion that it was also the duty of the
businessman to take care of the interests of various stakeholders. Business organization earn money by
selling goods and services to consumers. So the interests of the stakeholders have to be well taken care of.
State three points that highlight the need for consumer protection as discussed in 'Grahak Shakti's
workshop.
3. Identify the consumer right highlighted in the following statements:
i. A consumer has a right to get compensation against any unfair trade practice.
ii. This right states that a consumer has the right to get complete information about the product.
iii. A consumer has a right to select from a variety of products at competitive prices.
iv. A consumer has a right to register his dissatisfaction.
v. A consumer must be protected against goods and services which are hazardous to health, life and
property.
4. Shenoy went to buy a pack of chocolate for his son from a shop in the nearby market. Despite his
preference to buy a pack of chocolate of another brand, by giving some odd justifications. After coming
back home, Shenoy was feeling very dissatisfied.
Identify and explain the consumer right being viloated in the above para.
5. Manuj bought a packet of chips from a local shopkeeper and found that the ingredient given on the label
were not legible. He complained about it to the company. The company sent a written aplology stating
that they will make sure that existing packets are withdrawn from the market and new packets with
legible labels are soon made available.
State the consumer right which Manuj exercised.
6. Akshit bought a bottle of disinfectant spray from the nearby market. It had a knob which was to be
opened in a particular way. However, there was no instructions on its package in this regard. Therefore,
when he tried to open the knob in a casual way, some of the spray flew in his eyes. This affected his
vision.
Identify and explain the consumer right being violated by the company.
7. Suman bought a box of cheese of a reputed brand from a local shopkeeper. On opening the box she
found a piece of stone in the cheese. She reported the matter to the shopkeeper who forwarded her
complaint to the concerned company. Within a week the representative of the company visited Suman's
residence with an aplogy and as a replacement offered her a new cheese pack with four other varieties
of cheese as compensation for the inconvenience to her.
State the consumer right which Suman exercised.
8. State whether the following are treated as a consumer under Consumer Protection Act:
i. Deepak got his eyes operated from free eye camp.
ii. Payal bought a new mobile phone where she paid a cash down of rupees 10,000 and balance in 10
equal instalments.
iii. Shenoy uses new internet connection purchased by his father.
iv. Gurpreet purchased a cell phone for resale.
Consumer Protection Page 8 of 9
 B.St. Notes - XII Consumer Protection

v. Gurleen purchased washing machine for her house.

9. Name the redressal forum where a consumer can file a compaint in the following cases:
i. Where a claim is of Rs 100 lakhs.
ii. Where a claim is of Rs 100 .
iii. Where a claim is of Rs 1.1 crore.
iv. Where a claim is of less than Rs 1 crore.
v. Where a claim is of more than Rs 100 lakhs.
10. Shenoy went with his family to watch a movie. On his way back, he visited a retail store and purchased
a health drink for Rs 150. Later he discovered that the Maximum Retail Price was only Rs 75 and retail
store has over charged the health drink. He decided to file a court case against the retail store.
a) Name the consumer court where Tejus can file his complaint.
b) Explain the redressal procedure to be followed in the above case.
11. Your mother purchased a colour television for Rs 70,000 without cash-memo from an authorised dealer
of the manufacturer with a guarantee that the television will be replaced with a new one if any of its
parts becomes defective within three months from the date of purchase. Within 10 days a part of the
television was burnt and on complaining the seller refused to replace the television. Name the redressal
agency under the Consumer Protection Act where your mother can file the complaint.

Consumer Protection Page 9 of 9