NEED FOR CONSUMER PROTECTION ACT IN AN

ERA OF FREE COMPETITION WHERE ‘CONSUMER IS A KING’

Introduction

To provide Consumer is..• Most powerful motivation force• Equally liable to penaltiesApplicable toExcludes

Need for Consumer Protection Act

• Illiteracy and Ignorance• Unorganized Consumers• Spurious Goods• Deceptive Advertising• Malpractices of Businessmen• Freedom of Enterprise• Legitimacy for Existence• Trusteeship

Purpose and Objectives

• To protect the basic rights of a consumer

• Not to provide a loophole and excuses

• Educating the consumer Regarding their rights To propagate awareness about the

act and the ethical practices

Salient features of CPAThe Act applies to all goods and services

unless specially exempted by Union Government

It covers all sectorsProvisions of the Act are compensatory in

nature It envisages establishment of consumer

protection councilsProvisions of this act are in addition to and not

in derogation of the provisions of any other act.

Definitions

• Complainant• Complaint• Consumer• Consumer dispute• Defect• Deficiency• Goods• Manufacturer• Service• Trader

What is Free Market ?

• Eg: Brazil, Kenya, India, United Kingdom, Nicaragua

and Peru among others.

Why is Consumer the King in a Free Market?• Freedom of choice Example- 1.online shopping 2.Ford

model T• Rational decisions example- 1.Return on investment,

Technological evaluation, Business Expansion 2. Sportswear

• large number of firms- homogenous product.

Example- 1.Pepsi and Coke 2.Smartphone Companies

Why is Consumer the King in a Free Market?• Easy entry and exit (low “barriers to entry”) Example-1. Telecommunications, energy2. Consulting, education3. Hotels, ironworks4. Retail, electronic commerce• The actions of an individual firm have little

to no effect on market price. Example- 1.Nokia

Other ActsTHE SALE OF GOODS ACT, 1930

It came into force on 1st July 1930. Excludes State of Jammu & Kashmir.Contract of sale (Section5)• A contract of sale is made by an offer to buy

or sell goods for a price and the acceptance of such offer

• a contract of sale • may be made in writing or• by word of mouth or• or partly in writing and partly by word of mouth • Eg:- customer and salesperson

THE ESSENTIAL COMMODITIES ACT 1955

“Essential commodity" means any of the following classes of commodities :-

(1) cattle fodder, including oilcakes and other concentrates;

(2) coal, including coke and other derivatives;(3) component parts and accessories of automobiles;(4) cotton and woolen textiles;(4.A) drugs.

This act provides, in the interest of the general public, for the control of the production, supply of distribution of, and trade and commerce in certain commodities.

Case Studies• Don't eat onions, prices will dip

• Fruits and veggies no longer taxable(Assam)

Supreme courtPetitioner

Vishnu Pratap Singh Langawat

Agricultural Produce

Marketing Committee Act,

1972

State government

THE PREVENTION OF FOOD ADULTERATION ACT 1995• The Act came into effect from 1st June, 1955.• Food being one of the essentials – proper health• The main objective was to protect the public from

poisonous and harmful foods• Access to pure, nutritious food, free from any type

of adulteration – right of every citizen• Case Study

Amul fined ₹5000 for selling with wrong info

Kaira District Co-operative Milk

Producers'

Markets under Amul

1 yr Imprisonment to

Ashok Patel

THE STANDARDS OF WEIGHTS AND MEASURES ACT 1976

Aims at introducing standards in relation to weights and measures used in trade and commerce.

Objectives– Establish standards of weights and measures.– Regulate inter-state trade or commerceManufacture/sale/distributionPenal provisions• A fine of ₹500/- to ₹1000• And imprisonment up to seven yearsEg:-Bisleri(1 ltr and 800 ml)

CONSUMER RIGHTS

• Right to safety

• Right to be choose

• Right to be heard

• Right to be informed

Customer care number for any complaints on quality of the product

Nutritional facts about the products

Packaging and expiry date is mentioned & also the price

Standard followed- bar code (right to safety)

Standard weight is mentioned

• Right to seek redresssal • Right to consumer education

Right To Information

• OBJECTIVES OF THE ACT Greater Transparency . Informed Citizenry for promotion. Improvement in Accountability and performance Reduction in Corruption

SECTION 6 : REQUEST FOR INFORMATION :

Steps: Make a request • In writing or• Through electronic means• In English/Hindi/regional language

SECTION 8 : INFORMATION THAT CANNOT BE GIVEN

There shall be no obligation to give any citizen Information:-

• disclosure of which would affect the sovereignty and integrity of India.

• which is forbidden to be published by any court of law or tribunal.• the disclosure of which would cause a breach of privilege of

parliament or the state legislature.• received in confidence from foreign government

SECTION 20 –PENALTY FOR REFUSAL ON INVALID GROUNDS

The central or state commission:-  Penalty of ₹250 is imposed each day till

application is received Total amount shall not exceed ₹25000 Recommend for disciplinary action against1. The central public information officer or 2. The state public information officer As the case may be, under the service rules

applicable to him.

Success Stories – RTI ACT • Hospital Authority fined

25K under RTI (1) – Mumbai

• Corruption in passport office –New Delhi

Consumer Protection Councils • The Act postulates establishment of

Consumer Protection Councils for the purpose of spreading consumer awareness.

• Central level- central consumer protection council & State level- state consumer protection council.

• To promote and protect all the rights mentioned above of consumers.

3-Tier Redresssal Agency

The aims and objectives of the Act are achieved by the constitution and creation of 3-tier judicial machinery depending upon the amount of loss involved District Forum

State Commission

National Consumer Disputes redressal Commission.

NATIONAL COMMISSION

STATE COMMISSION

DISTRICT FORUM

Statistical Data

SI. No.

Name of Agency

Cases filed since inception

Cases disposed of since inception

Cases Pending

%of total Disposal Remarks

1. National Commission

78471 68241 10230 86.96%

2. State Commissions

589771 495717 94054 84.05%

3. District Forums

3205530 2960263 245267 92.35%

TOTAL 3873772 3524221 349551 90.98%

Total Number of Consumer Complaints Filed / Disposed since inception Under Consumer Protection Law (as on 04.12.2012)

Consumer Responsibilities • Buying quality products at rea sonable

price.• To check the weights and meas ures

before making purchases.• Reading the label carefully.• Beware of false and attractive

advertisements.• Beware of misleading schemes.

Consumer Responsibilities • To procure the bill, cash received

warranty, etc.• Buying from reputed shops• Don't make purchases from black

market• To buy standardized product• To use a product as per the instruction

of the manufacturer• Knowledge of consumer rights

DIGITAL EXPOSURE FOR CONSUMER

http://www.jagograhakjago.in/

Login Form for http://www.jagograhakjago.in/

File your complaints

Toll Free No. - 1800-

180-4566

http

://www.consumerco

mplaints.in

Brand Power advertisement of a health drink for kids (Cadbury’s Bournvita)

Brand Power advertisement ofLivon Hair Gain Tonic

Comparative Analysis

• Background of Consumer protection Act • The Purpose of the Consumer Protection Act• Who does the Consumer Protection Act Affect?• What are the Consumer Rights in Terms of the

Consumer Protection Act?• Key Points of the Consumer Protection Act• Mechanisms of the Consumer Protection Act

Background

• Came into effect on 1april 2011

• Promote fairness, openness and good business practices

• Supports and strengthens consumer R&R

• Excludes all agreements before 1 april 2011

• Came into effect on 24december 1986

To provide • For better protection• For that purpose to make

provisions • For the settlement of

consumer’s disputes.• Excludes goods and services

under personal service or for resale

SOUTH AFRICA INDIA

Purpose

• Creating A legal framework for consumers

• Reducing the difficulties of consumers

• Protecting consumers from unfair trade practices;

• Encouraging responsible consumer behaviour

• To protect the basic rights of A consumer

• Prevent consumers from getting exploited

• Provide more accessible protection for consumers

• Provide A less formal, less expensive and faster way to seek justice

Who does the Consumer Protection Act Affect?Consumer• An individual to whom

goods or services are marketed

Supplier• A business or other

organisation that operates in South Africa as a supplier of goods or services is called a supplier

• Consumer• Manufacturer• Trader

Consumer Rights• Right to Equality in the Consumer

Market and Protection against Discriminatory Marketing Practices

• Right to Privacy• Right to Choose• Right to Disclosure of Information• Right to Fair and Responsible

Marketing• Right to Fair and Honest Dealing• Right to Fair, Just and Reasonable

Terms and Conditions• Right to Fair Value, Good Quality and

Safety• Right to Accountability from Suppliers

• Right to be protected from all hazardous goods & services

• Right to be fully informed about the performance and quality of all goods and services

• Right to free choice of goods and services

• Right to be heard in all decision-making processes related to consumer interests

• Right to complete consumer education

• Right to seek redressal, whenever consumer rights have been infringed

Key Points of the Consumer Protection Act

• Language• Marketing Standards• Cooling-off periods• Fixed-Term Contracts• Overselling and

Overbooking• Implied Warranty of

Quality• Prepaid Certificates,

Credits and Vouchers

• Speedy redressal • Involvement of

consumers• Goods and Services• Exemption• Provisions • Complaint

Mechanisms of the Consumer Protection Act

Case Study

• Company :- Sony Ericson

• Consumer:- Rutu Ladage

• Problem Consumer Right Compensation

QUESTIONS YES NO

Q1. Do you examine the expiry date the food items and medicines when you buy them?

30 -

Q2. Have you ever cross checked the weights of the products mentioned on the item?

6 24

Q3. Do you check the M.R.P.(Maximum Retail Prices) before buying the products?

30 -

Q4. Have you ever come across adulteration in?

i) Food stuff 6 24

ii) Milk 9 21

Q5. Have you ever been cheated in regards to a product/service offered to you?

7 23

Q6. If yes, did you complain to?

Shop-keeper;

21

Main Sup-

plier; 2Din't Complain; 1.2

QUESTIONS YES NO

Q7. Was your complaint to the supplier/shopkeeper attended by him to your satisfaction?

28 2

Q8. Are you aware of consumer courts, for redressal of grievances of consumers?

30 -

Q9. Are you aware of the procedure to file a case in the consumer courts? 12 18

Q10. If yes, have you ever filed a case in the consumer court? 2 28

CONCLUSIONSo is the consumer really the

?????

Recommendations

• Providing Consumer Education• Adulteration • Building Pressure On

Government• Arranging Consumer Protection

Programmes or Organising Public Opinion

• Providing Guidance To Consumer • Misleading advertisement

Bibliography• http://www.ummid.com/news/2014/January/

10.01.2014/sc-on-onion-price.html#sthash.natkhtap.dpuf

• http://www.medindia.net/indian_health_act/consumer_protection_act_and_medical_profession_consumer_disputes_redressal_agencies.htm#ixzz2s4jBl9QE 

• http://indiankanoon.in/doc/1819218/ • http://pib.nic.in/newsite/erelease.aspx?relid=79338 • http://dc-siwan.bih.nic.in/Consumer_Act.pdf• Consumer Protection » Center for Finance, Law &

Policy | Boston University• http://nvonews.com/2011/01/19/%E2%80%98jago-

grahak-jago%E2%80%99-%E2%80%93-an-initiative-towards-consumer-education-and-awareness/