Consumer Protection Act

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Introduction
Each one of us is a consumer in one way or another. It is important for us to be an aware and
informed consumer of goods and services available to us in the market. But, very few consumers
are aware of their rights given to them by the Consumer Protection Act, 2019. The Consumer
Protection Act, 2019 has replaced the Act, 1986 and seeks to widen its scope in addressing
consumer concerns.

With growing competition and in an attempt to increase their sales and market share,
manufacturers, sellers and service providers may be tempted to engage in unscrupulous,
exploitative and unfair trade practices like defective and unsafe products, adulteration, false and
misleading advertising, hoarding, black-marketing, etc. This means that a consumer might be
exposed to risks due to unsafe products, might suffer from bad health due to adulterated food
products, might be cheated because of misleading advertisements or sale of spurious products,
might have to pay a higher price when sellers engage in overpricing, hoarding or black-
marketing, etc. As a result, consumer becomes unsafe, feels cheated and is exposed to many risks
and health problems.
Volkswagen, Red Bull, Kellogg's
Importance of Consumer Protection Johnson & Johnson, L'oreal
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.
Who is a 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.

Consumer Rights:
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, health and property. For example, 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. 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 against unfair trade practice of
restrictive trade practices or unscrupulous exploitation in case the product or a service falls short
of his expectations. The Consumer Protection Act 2019 provides for redressal 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
organisations and some enlightened businesses are taking an active part in educating consumers
in this respect.
Consumer Responsibilities:
Consumer protection can, in effect, be achieved only when the consumers also understand their
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.

(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.

Ways and Means of Consumer Protection

A consumers’ awareness about their 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.

1. Self-regulation by Business: Socially responsible firms follow ethical standards and

practices in dealing with their customers Good and ethical practices encourage firms to realise
that it is in their long-term interest to serve the customers in a rightful manner. Many firms
have set up their customer service and grievance cells to redress the problems and grievances
of their consumers.

2. Business Associations: The associations of trade, commerce and business like Federation of
Indian Chambers of Commerce of India (FICCI) and Confederation of Indian Industries (CII)
have laid down their code of conduct which lay down for their members the guidelines in
their dealings with the customers.
3. Consumer Awareness: A consumer, who is well-informed about his rights and the reliefs
available to him, would be in a position to raise his voice against any unfair trade practices or
unscrupulous exploitation. In addition to this, an understanding of his responsibilities would
also enable a consumer to safeguard his interests. In this regard, the Department of Consumer
Affairs, GOI, has been undertaking Jago Grahak Jago campaign, for generating awareness
among consumers.

4. Consumer Organisations: Consumer organisations play an important role in educating

consumers about their rights and providing protection to them. These organisations can force
business firms to avoid malpractices and exploitation of consumers.

5. Government: The government can protect the interests of the consumers by enacting various
measures. For example, the GOI has set up a toll-free national consumer Helpline Number
1800114000 for this purpose. The legal framework in India encompasses various legislations
which provide protection to consumers. The most important of these regulations is the
Consumer Protection Act, 2019. The Act provides for a central authority to regulate matters
relating to violation of rights of consumers, unfair trade practices and false or misleading
advertisements which are prejudicial to the interests of consumers. This is known as Central
Consumer Protection Authority (CCPA). A three-tier machinery at the district, state and
national levels for redressal of consumer grievances.

Redressal Agencies under Consumer Protection Act

For the redressal of consumer grievances, the Consumer Protection Act, 2019 provides for setting
up of a three-tier enforcement machinery at the District, State, and the National levels, known as
the District Consumer Disputes Redressal Commission, State Consumer Disputes Redressal
Commission, and the National Consumer Disputes Redressal Commission. They are briefly
referred to as the ‘District Commission’, ‘State Commission’, and the ‘National Commission’,
respectively. While the National Commission is set up by the Central Government, the State
Commissions and the District Forums are set up, by the State Government. The Figure on
redressal agencies shows the hierarchical structure of this three-tire machinery.

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.