Consumer Protection Act: Anirudh Venkatesh

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CONSUMER

PROTECTION ACT
ANIRUDH VENKATESH
INTRODUCTION

• The Consumer Protection Act, 1986 was implemented in order to


provide better protection to the rights of the consumers.
• Prior to the implementation of this Act, there was no special act for
protecting the consumers and the only remedy available to the
consumers was under the Law of Torts i.e filing a civil suit for damages
against the shopkeeper or the service provider.
• Civil Wrong vs. Criminal Wrong
INTRODUCTION…

• This act is based on the doctrine of Caveat Emptor which means


that it is the responsibility of the buyer to identify the defects in
the good.

• It also embodies the principles of Contra Proferentem, Conditions


and Warranties from the Sale of Goods Act and Contractual principles
enshrined in the erstwhile Contract Law.
OBJECTIVES

1. To promote and protect all the six rights of the consumers which will be
discussed later.
2. To provide simple and speedy disposal to the cases by providing quasi-
judicial machinery for the redressal of consumer disputes.
3. The act also aims to provide inexpensive redressal to the issues of the
consumer.
4. A consumer dispute redressal forum called state commission has been set
up in order to settle the disputes of each and every consumer in all the
states of the country.
DEFINITIONS

• According to Sec-2(1)(d) of the Act, a consumer is a person who


purchases any goods or services or hires or avails the services of some
person for his own personal use and not for manufacturing or resale of
that good. For instance, a person purchasing wheat flour for his own
personal use is a consumer but a person purchasing wheat flour for
baking bread which he is going to sell in his bakery shape is not a
consumer.
DEFINITIONS…

• Complaint– According to Sec-2(1)(c) any allegation made by the


consumer regarding any restrictive or unfair trade practice which the
traders have adopted such as goods bought by a consumer are defective,
services hired or availed by him suffer some deficiency, trader has charged
an excessive price of the goods mentioned in the complaint, goods or
services which are hazardous to the life and property of the consumer has
been offered for sale to the public by the trader or the service provider.
• Consumer Dispute– according to Sec-2(1)(e) of the act it is a situation
when a person denies the allegations filed against him in a complaint.
DEFINITIONS…

• Person– according to Sec-2(1)(m) of the act the word person includes


a registered or unregistered firm, a Hindu undivided family, co-
operative society and any other association which is registered as a
person under the Societies Registration Act of 1860.
• Service– according to Sec-2(1)(o) service means any description or
any facility which is provided to the potential users and is not rendered
free of charge or under a contract of personal service.
RIGHTS OF A CONSUMER

• The Consumer Protection Act has recognized six rights of a


consumer which are:
1.Right to Safety
2.Right to Information
3.Right to Choose
4.Right to be heard
5.Right to Redressal
6.Right to Consumer Education.
RIGHT TO SAFETY

• This right refers to as the right to be protected against the marketing


of goods and services which are hazardous to life and property of the
consumers.
• This right has a very wide scope of application, for instance, this right
is available in the areas of electrical appliances, healthcare,
automobile, pharmaceuticals, housing, travel etc.
• There is a mandate for each and every field to get all their products
which are a danger to the life to be carefully tested and validated
before launching it to the market.
RIGHT TO INFORMATION

• It refers to the right of a consumer to be informed of the quality,


quantity, potency, purity, standard and price of the goods and services
being sold by the shopkeeper.
• This right is given to the consumer in order to protect them from the
various unfair trade practices conducted by the seller in order to earn
more profits.
• Therefore, it is an obligation on the seller to provide the consumer with
all the relevant information of the product he wishes to purchase.
RIGHT TO CHOOSE

• It is defined in the act as the right to be assured, wherever possible, to


have access to a variety of goods and services at competitive prices.
• It is very common to find one product being sold at different possible
prices by different sellers. This reflects the age of market competition
which is found in almost all the countries. Therefore it is the right of all
the consumers to purchase any product at any price which according to
him is the best.
RIGHT TO BE HEARD

• Audi Alterum Partem


• It is referred to as the right to be heard and to be assured that consumers’
interests will receive due consideration at appropriate forums.
• This right was introduced for a consumer in order to ensure that all the
complaints and issues of the consumers are heard duly under the
appropriate authority.
• This is because of this right that almost all the big selling companies have
a separate department known as the customer service to help the
consumers in case of any dispute or any complaint regarding the quality or
quantity of the product.
RIGHT TO SEEK REDRESSAL

• If any consumer has been exploited by the seller or faced any unfair
trade practices he can seek redressal i.e. compensation or damages
under this right.
• This right ensures that all the issues of the consumers are dealt with
and justice is done to him. A proper redressal mechanism has been set
up by the government of India such as the consumer courts and
forums at district and national level.
RIGHT TO CONSUMER EDUCATION

• It is the right of each and every person who is a citizen of India to have
knowledge about all the laws and policies relating to the consumer.
• Therefore it is made sure the material regarding the consumer-related
laws is easily available all over India but there is still a major part of
the population who is not aware of his laws and rights.
• This is the reason many awareness programs have been organized by
the government of India such as ‘jago grahak Jago’ and the camps
organized by various lawyers in the remote areas of the country.
DUTIES OF A CONSUMER

• Every consumer right comes with the opposite duty. Right of one consumer
is the duty of the others. Accordingly, there are various duties such
as:-
• On purchasing of goods or hiring of any services, it is the duty of the
consumer to pay for the same.
• While purchasing something it is his duty to check weights, balances,
prices etc. and also to give a careful reading to the labels.
• It is the duty of the consumer to update himself about the various
consumer protection schemes.
DUTIES…

• Duty to be careful while purchasing and not to fall in the trap of misleading
information and advertisements.
• It is the duty of the consumer to not purchase anything from the black markets.
• It is the duty of the consumer to be aware of his rights and duties and also
spreading the awareness of the same among others.
• It is the consumers’ duty to file a complaint if the goods which he purchased are
defective.
• Each and every consumer should secure the bills of the goods purchased or the
services availed so that if in the future he finds the goods or services to be
defective he can easily file a complaint against the same and can prove it.
REDRESSAL MECHANISM

• National, State and District level protection.

• District Consumer Redressal Forum – Up to 20 Lakhs


• State Consumer Redressal Forum – 20 Lakh to 1 Crore
• National Consumer Redressal Forum – More than 1 Crore

• These thresholds have been changed by the 2019 Amendment Act. (Discussed Below)
WHO CAN FILE A COMPLAINT?

• According to sec-2(1)(b) a complainant can be a person who is:


• A consumer, or
• Any voluntary consumer association registered under the Companies Act of 1956 or
under any other law for the time being in force, or
• The Central Government or any State Government, who or which makes a
complaint, or
• One or more consumers, where there is more than one consumer they shall have
the same interest for filing a collective complaint, or
• In the case of death of a consumer, his legal heir or representative who or which
makes a complaint.
HOW TO FILE A COMPLAINT?

• The very first step before filing a complaint the aggrieved party should do
is to send a notice to the service provider from whom the goods were
purchased or the service was availed informing him about the defects in
the goods or the deficiency in the service or unfair practice.
• This notice is sent to the trader or the aggrieved party in order to see if
that company or trader is willing to give the compensation or offer any
other remedy.
• The next step is to file a formal complaint under the Consumer Protection
Act of 1986. Here the aggrieved party does not need to hire a lawyer in
order to file a complaint. He can file the complaint on his own.
FILING A COMPLAINT

• The aggrieved party just need to write down the following contents on a
plain paper:
• Name, description and the address of the complainant and of the opposite party or
parties
• Facts relating to the complaint and time and venue where it arose
• All the possible documents in support of the allegations contained in the complaint
• The relief or the remedy claimed by the complainant
• The complaint should consist of signatures of the complainant or his authorized
agent
WHERE TO FILE THE COMPLAINT

• The next step after the drafting of the complaint is to choose the
appropriate authority under whom the complaint is to be filed.
• The complainant shall choose the authority according to pecuniary
jurisdiction of his complaint i.e. the total value of the goods or services
and the compensation claimed by him.
• It is to be noted here that the complainant can also file an online
complaint on www.consumerhelpline.gov.in
COURT FEES

• District Forum:
• Up to Rs 1 lakh: Rs 100
• Between Rs 1-5 lakh: Rs 200
• Between Rs 5-10 lakh: Rs 400
• Above Rs 10 lakh and up to Rs 20 lakh: Rs 500
• State Forum:
• Above Rs 20 lakh but less than Rs 50 lakh: Rs 2,000
• Above Rs 50 lakh and up to Rs 1 crore: Rs 4,000
• National Forum:
• A standard amount of Rs 5,000
REMEDIES

• Removal of Defects– if the consumer after conducting a proper test


by using the product finds the product to be defective then the
authority can pass an order of removing the defects in the product.
• Replacement of goods
• Refund of the price paid by the consumer while purchasing the product.
• Award of Consumption– a consumer can demand compensation from
the trader or service provider if because of his negligence the
consumer has suffered some physical or any other loss.
REMEDIES…

• Removal of Deficiency in Service– the authority can pass orders for removal of the deficiency if
there is any deficiency in delivery of the service, for instance, if the consumer has applied for a loan
and has fulfilled all the formalities but the bank is making unnecessary delay in sanctioning the loan,
then the court can pass orders to sanction the loan.

• Discontinuance of Unfair/ Restrictive Trade Practice– if a complaint is filed by the consumer


against any unfair trade practice in the market, the authority can order an immediate withdrawal of
such practice and can also pass an order for banning such trade practice.

• Stopping of sale of hazardous goods

• Withdrawal of hazardous goods from the market.

• Payment of the adequate cost


CONSUMER PROTECTION ACT 2019

• The Consumer Protection Act, 2019 was enacted by the Indian


legislature to deal with matters relating to violation of consumer’s
rights, unfair trade practices, misleading advertisements, and all those
circumstances which are prejudicial to the consumer’s rights.
• The intention of the Parliament behind enacting the Act was to include
provisions for e-consumers due to the development of technology,
buying and selling of goods and services online have considerably
increased during the last few years.
OBJECTIVES IN 2019

1. Protect against the marketing of products that are hazardous to life and property.

2. Inform about the quality, potency, quantity, standard, purity, and price of goods to safeguard the consumers against unfair trade
practices.

3. Establish Consumer Protection Councils for protecting the rights and interests of the consumers.

4. Assure, wherever possible, access to an authority of goods at competitive prices.

5. Seek redressal against unfair trade practices or unscrupulous exploitation of consumers.

6. Protect the consumers by appointing authorities for timely and sufficient administration and settlement of consumers’ disputes.

7. Lay down the penalties for offences committed under the Act.

8. Hear and ensure that consumers’ welfare will receive due consideration at appropriate forums in case any problem or dispute
arises.

9. Provide consumer education, so that the consumers are able to be aware of their rights.

10.Provide speedy and effective disposal of consumer complaints through alternate dispute resolution mechanisms.
UNFAIR TRADE PRACTICES

• Section 2(47) of the Consumer Protection Act, 2019 defines the term
‘unfair trade practices’ which include:
1.Manufacturing spurious goods or providing defective services.
2.Not issuing cash memos or bills for the goods purchased or services
rendered.
3.Refusing to take back or withdraw the goods or services and not refunding
the consideration taken for the purchase of the goods or services.
4.Disclosing the personal information of the consumer.
CHANGES INCORPORATED IN CONSUMER
PROTECTION ACT, 2019
• The changes that were incorporated with the enactment of the
Consumer Protection Act, 2019 are:
1.The District Commissions will have the jurisdiction to entertain
complaints where the value of the goods, services or products paid as
consideration to the seller does not exceed 50 lakh rupees.
2.State Commissions will have the jurisdiction to entertain complaints
where the value of the goods, services or products paid as
consideration to the seller exceeds 50 lakh rupees but does not exceed
two crore rupees.
CHANGES…

1.The National Commission will have the jurisdiction to entertain complaints


where the value of the goods, services or products paid as consideration to
the seller exceeds two crore rupees.
2.The Act further states that every complaint concerning consumer dispute
shall be disposed of as expeditiously as possible. A complaint filed under
this Act shall be decided within the period of three months from the date of
receipt of notice by the opposite party in the cases the complaint does not
require analysis or testing of the goods and services and within a period of
5 months, if it requires analysis or testing of the goods and services.
CHANGES…

1.The Consumer Protection Act, 2019 also facilitates the consumers to file
complaints online. In this regard, the Central Government has set up
the E-Daakhil Portal, which provides a convenient, speedy and inexpensive
facility to the consumers all over India so that they are able to approach
the relevant consumer forums in case of any dispute arises.
2.The Act lays down the scope for e-commerce and direct selling.
3.The Consumer Protection Act, 2019 lays down provisions for mediation and
alternative dispute resolution so that the parties are able to dispose of the
case conveniently without going through the trouble of litigation.
CHANGES…

1.The Consumer Protection Act, 2019 contains provisions for product


liability, unfair contracts and it also includes three new unfair trade
practices. In contrast, the old Act just stated six types of unfair trade
practices.
2.The Act of 2019 acts as the advisory body for the promotion and
protection of consumer rights.
3.Under the Consumer Protection Act, 2019 there is no scope for
selection committees, the Act authorizes the Central Government to
appoint the members.
CONSUMER PROTECTION COUNCIL

• The Act establishes consumer protection councils to protect the rights of the
consumers at both the national and state levels.
• Under Chapter 2 Section 3 of the Consumer Protection Act, 2019 the Central
Government shall establish the Central Consumer Protection Council which is known
as the Central Council.
• Every state government shall establish a State Consumer Protection Council known
as the State Council having jurisdiction over that particular state.
• Under Section 8 of the Act, the state government shall establish a District
Consumer Protection Council for every district known as the District Council.
CENTRAL CONSUMER PROTECTION AUTHORITY

• The Central Government shall establish a Central Consumer Protection Authority


which is known as the Central Authority under Section 10 of the Consumer
Protection Act, 2019, to regulate matters relating to violation of the rights of
consumers, unfair trade practices and false or misleading advertisements which are
prejudicial to the interests of the public and consumers and to promote, protect and
enforce the rights of consumers.
• The Central Authority must have an ‘Investigative Wing’ under Section 15 of the Act
to conduct an inquiry or investigation. The investigative wing must comprise of the
Director-General and the required number of Additional Director-General, Director,
Joint Director, Deputy Director and Assistant Director possessing the required
experience and qualifications to carry out the functions under this Act.
FUNCTIONS OF THE CENTRAL AUTHORITY

• The functions and responsibilities of the Central Authority are laid down in Section
18 of the Act which includes;
1.To protect and promote the rights of the consumers as a class and to prevent
violation of consumer rights,
2.To prevent unfair trade practices,
3.To ensure no false or misleading advertisements regarding any goods or services
are promoted,
4.To ensure no person takes part in false or misleading advertisements,
5.Inquire or investigate in cases of violation of consumer rights or unfair trade
practices.
FUNCTIONS…

1.File complaints before the National, State or District Commission as the


case may be,
2.To review matters relating to the factors hindering the enjoyment of
consumer rights.
3.To recommend the adoption of international covenants and best
international practices concerning consumer rights
4.Promote research and awareness of consumer rights.
5.Lay down necessary guidelines to prevent unfair trade practices and
protect the interests of the consumers.
FUNCTIONS

• Under Section 21 of the Act, the Central Authority is authorized to issue


directions to false and misleading advertisements which may extend to
ten lakh rupees. While determining the penalty of the offence the
Central Authority must keep in mind factors such as; the population
affected by the offence, frequency of the offence and gross revenue
from the sales of such product. The Central Authority can also direct
search and seizure for the purposes of this Act and in that case the
provisions of the Criminal Procedure Code, 1973 will apply.
MEDIATION

• Chapter 5 Section 74 of the Consumer Protection Act, 2019 states that a


Consumer Mediation Cell shall be established by the Central Government
at the national level and every state government shall establish Consumer
Mediation Cell exercising within the jurisdiction of that state. The mediator
nominated to carry out the mediation shall conduct it within such time and
in such manner as may be specified by regulations.
• Section 75 of the Act talks about the empanelment of the mediators. It
states the qualifications, terms and conditions of service, the procedure for
appointing, and the fee payable to the empaneled mediators.
LIABILITY OF THE PRODUCT MANUFACTURER

• A product manufacturer will be held liable in a product liability action


under the following circumstances:
• The product contains manufacturing defects.
• The product is defective.
• There is a deviation from manufacturing specifications.
• The product does not conform to the express warranty.
• The product fails to contain adequate information for proper usage.
LIABILITY OF PRODUCT SERVICE PROVIDER

• A product service provider will be held liable in a product liability action


under the following circumstances:
• The service provider will be responsible when the service provided by them
is faulty or imperfect.
• There was an act of negligence on their part.
• The service provider failed to issue adequate instructions and warnings for
the services.
• The service provider failed to conform to the express warranty or terms
and conditions of the contract.
LIABILITY OF PRODUCT SELLER

• A product seller will be held liable in a product liability action under


the following circumstances:
• They altered or modified the product which resulted in being
detrimental to the consumer.
• They failed to exercise reasonable care in assembling, inspecting or
maintaining such product
• They exercised substantial control over the product which resulted in
causing harm to the consumer.
EXCEPTIONS

• There are certain exceptions to product liability action mentioned


in Section 87 of the Act, such as;
• The product was altered, modified or misused by the consumer,
• A consumer cannot bring product liability action when the manufacturer
has given adequate warnings and instructions for the use of the product,
• The manufacturer would not be liable in case of a product liability action
for not warning about any danger that is commonly known to the general
public.
OFFENCES AND PENALTIES

• The offences and penalties listed under this Act are mentioned as follows.
1.Punishment for false and misleading advertisements: Under Section 89 of the
Act any manufacturer or service provider who promotes false or misleading
advertisements will be punished with imprisonment for a term that may extend to
two years and with fine that may extend to ten lakh rupees.
2.Punishment for manufacturing, selling, distributing products containing
adulterants: Under Section 90 of the Consumer Protection Act, 2019 any person
who sells, manufactures, distributes products containing adulterants shall be
penalized in case of the following circumstances;
OFFENCES

• If the adulterated product does not cause any injury to the consumer then the term for
imprisonment will extend to a period of six months and fine which may extend to one
lakh rupees,
• If the product containing adulterant causes injury not amounting to grievous hurt then
the term for imprisonment will extend to a period of one year and fine which may extend
to three lakh rupees,
• If the product containing adulterant causes injury amounting to grievous hurt then the
term for imprisonment will extend to a period of seven years and fine which may extend
to five lakh rupees,
• If the product results in causing death to the consumer then the term for imprisonment
will be for a period of seven years which may extend to life imprisonment and fine not
less than ten lakh rupees.
OFFENCES

• Punishment for manufacturing, selling, and distributing


spurious products: Section 91 states that any person who sells,
manufactures, or distributes spurious products shall be punished for
such acts.

• Remedies are considered to be separate from offences and penalties.


THANK YOU

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