“BUSINESS ENVIRONMENT”

An
Assignment
Of
“Business environment”
SUBJECT: - CONSUMERISM

SUBMITTED BY: - ROLL.NO:-

SORATHIYA ASHISH L. [111]

SUBMITTED TO:-
MR.PRAKASH TANK

VIVEKANAND COLLEGE FOR BBA

T.Y.B.B.A
5TH SEM (B)
2009-2010

CONSUMERISM
 Short Note on Consumerism:

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A. Rights of consumerism under Consumer Protection Act 1986

B. Three tier consumer disputes redressal system under the
Consumer Protection Act.

 INTRODUCTION:

In the age of revolutionized information technology and with the emergence of

e-commerce related innovations the consumers are further deprived to a great extent. As a result
buyer is being misled, duped and deceived day in and day out. Mahatma Gandhi, the father of
nation, attached great importance to what he described as the "poor consumer", who according to
him should be the principal beneficiary of the consumer movement. He said "A Consumer is the
most important visitor on our premises. He is not dependent on us we are on him.
He is not an interruption to our work; he is the purpose of it. We are not doing a favour to a
consumer by giving him an opportunity. He is doing us a favour by giving an opportunity to serve
him."

Inspite of these views consumerism is still in its infancy in our country, thanks to the sellers
market and the government monopoly in most services. Consumer awareness is low due to the
apathy and lack of education among the masses. No one has told them about their rights - to be
informed about product quality, price, protection against unsafe products, access to variety of goods
at competitive prices, consumer education etc. What consumerism lacks here is education and
information resources, testing facilities, competent leadership, price control mechanism, and
adequate quasi-judicial machinery. The providers of goods and services have been reluctant to give
due consideration to consumer interest protection.

In present situation, consumer protection, though as old as consumer exploitation, has

assumed greater importance and relevance. Consumerism is a recent and universal phenomenon. It is
a social movement. Consumerism is all about protection of the interests of the consumers.

Consumerism is a movement to inform consumers and protect them from unfair trade
practices. The Movement focuses on inferior and dangerous merchandise, unfair business practices
and false on misleading advertisement. Unfair practices by businessmen abound, artificial scarcities
are created price are unreasonably hiked; adulteration is a unabashedly practicised; under

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measurement and under-weighing are rampant; money is accepted in advance, promising delivery of
product in question within a specified time but seldom honoured and after sales services are mostly
and unkept promise. Ads and labels are misused and are full of sex, false claims and half truths.

So that, Awareness of Consumerism Act is very important by which we can decreases

unfair trade practices.

At the 44th Annual General Meeting of Hindustan Lever Ltd. in 1977, the Chairman,
and Mr. T. Thomas, rightly pointed out: “While the producer has the power or the right to design the
product, distribute, advertise and price it, the consumer has only the power of not buying it. One may
argue that the producer runs the greater risk in spite of having several rights because the veto power
remains with the consumer. However, the consumer often feels that while he has the power of veto,
he is not always fully equipped to exercise that power in his best interests. This situation may be the
effect of lack of information, too much indigestible information or even misinformation from one or
several competing producers. This problem facing the consumer has led to ‘consumerism’.
It is worthwhile to note that consumerism, like other several social movements,
e.g. Independent Movement Civil right Movement, etc., has been the result of social conflict and can
not, therefore, be wished away. It will be with a till the conflict facing the consumer is a resolved.”

 Definition of Consumerism:

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According to McMillan Dictionary (1985) "Consumerism is concerned with protecting

consumers from all organisations with which there is exchanged relationship. It encompasses the set
of activities of government, business, independent organisations and concerned consumers that are
designed to protect the rights of consumers".

The Chamber's Dictionary (1993) defines Consumerism as the protection of the interests
of the buyers of goods and services against defective or dangerous goods etc.
"Consumerism is a movement or policies aimed at regulating the products or services, methods or
standards of manufacturers, sellers and advertisers in the interest of buyers,
such regulation maybe institutional, statutory or embodied in a voluntary code occupied by a
particular industry or it may result more indirectly from the influence of consumer organisations."

According to Philip Kotler, “A social movement seeking to augment the rights and the
powers of buyers in relation to sellers.”

 “The movement seeking to protect and inform consumers by requiring such practices as honest
packaging and advertising, product guarantees, and improved safety standards.”

 “The theory that a progressively greater consumption of goods is economically beneficial.”

 “An economic theory that increased consumption is beneficial to a nation's economy in the long
run.”
As commonly understood consumerism refers to wide range of activities of government
business and independent organisations designed to protect rights of the consumers. Consumerism is
a process through which the consumers seek redress, restitution and remedy for their dissatisfaction
and frustration with the help of their all organised or unorganised efforts and activities. It is, in-fact a
social movement seeking to protect the rights of consumers in relation to the producers of goods and
providers of services.
In-fact consumerism today is an all-pervasive term meaning nothing more than people's
search for getting better value for their money. Consumer is the focal point of any business.
Consumers' satisfaction will benefit not only business but government and society as well.

So consumerism should not be considered as consumers' war against business. It is a

collective consciousness on the part of consumers, business, government and civil society to enhance

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consumers' satisfaction and social welfare which will in turn benefit all of them and finally make the
society a better place to live in.

There are several Consumer Organization in India like-

 The Consumer Guidance Society of India (CGSI), Mumbai.

 The Consumer Education and Research Center (CERC), Ahmadabad.

Which are doing commendable work. Some of these organizations are very in conducting
product testing and exposing Substandard Quality and adulteration.ISI Certification of food colors,
demanded by the CGSI is now mandatory in 1993.

Since 1993, the Consumer Education and Research Society (CERS), sponsored by the CERC,
has been performing a very bold and commendable task of comparative testing of consumer goods at
their in house laboratory, and since 1998 it’s publication INSIGHT – The Consumer Magazine has
been carrying our test result far and near. The media have been publishing the test findings. These
test Results enable the consumer to evaluate and compare product of different companies.

 Components of Consumerism

There are various components of consumerism. First and foremost is self-protection by

consumers. Consumer must be aware of his rights, raise voice against exploitation and seek redressal
of his grievances. Consumers' consciousness determines the effectiveness of consumerism. It is the
duty of the consumer to identify his rights and to protect them. Voluntary Consumer Organisations
engaged in organizing consumers and encouraging them to safeguard their interests is another
important element of consumer movement the success of consumerism lies in the realization of the
business that there is no substitute for voluntary self-regulations.

Little attention from the business will not only serve consumers interest but will also benefit
them. Some businesses in India have come together to adopt a code of conduct for regulating their
own activities. Regulation of business through legislation is one of the important means of protecting
the consumers. Consumerism has over the time developed into a sound force designed to aid and

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protect the consumer by exerting, legal, moral and economic pressure on producers and providers in
some of the developed countries.

 UTILITY OF CONSUMERISM:

Consumer should accept consumerism as a means of asserting and enjoying their rights.
Consumerism should succeed in making the business and government more responsive to the rights
of consumers.
Well organised and dynamic consumerism may be expected to produce the following
results:

1. Producers and sellers will not take the consumers for garented. When consumer strong
enough to protect their rights, the business will compelled to shun unfair trade practices.
2. Consumerism will provide feedback for the business. It will enable to procedures to
understand consumer grievances, need and wants. This will assist in the more effective
implementation of marketing concept or societal marketing concept depending upon nature
of consumerism.
3. Producers will be able to enlist the support of consumers to minimize ht imperfection on the
distribution front. Several times the supply position is made worse by hording and black
marketing by traders. Further, Many sellers have tendency to charge a price which is higher
than actual by giving one or other reason. There is no reason why the consumer and
producer should not co-operate to get rid of the unscrupulous traders.
4. Consumerism will make the government more responsive to consumer interest, prompt it to
take necessary. Statutory measure, and make the required institutional arrangement to
safeguard consumer rights.

 ROLE OF CONSUMERISM

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A well-developed consumerism is essential for the protection of consumer rights.

Consumerism has the following important roles to play.

1. Consumer Education: The Consumer is given information about various Consumer goods
and services. This relates to prices, what the consumer can expect, standard, trade practices,
etc. Consumers are also made aware of their rights and responsibilities and the ways of
getting the grievances redressed.
2. Product Rating: In order to guide the consumer in his choice of product, some of the
agencies carry out test and the reports the result of such test.
3. Liaison with Government and with Producers: Another important role of consumer
organization is to maintain liaison with producer on the one hand and government authority
on the other. As government has key role in producing consumer rights, the consumer
organization have an important role to see that government play its role.

Role of Non- Governmental organizations

In addition to government many about 500 non-governmental organizations (N.G.Os) are

making efforts in order to safeguard the interest of consumer. These organizations perform the
following functions:
1. Accelerating consumer awareness/Educating consumers:

The first priority of consumer organization is to accelerate consumer’s awareness towards

their rights. To accomplish this task which they have to perform are:
(a) To publish Brochures, Journals.
(b) To arrange seminars, conferences and workshops.
(c) To educate consumers to help themselves.
(d) To provide special education to women about consumerism.
(e) To encourage to follow desirable consumption standards.

3. Filing Suit on Behalf of consumer: Whenever a consumer fails to raise his voice of protect
regarding his complaints, these organisations come to his rescue and file a case in the court. By
rendering services to consumers, the consumers get a feeling that they are not alone in their fight.
They also run voluntary complaints for the guidance of consumers.

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4. Helping educational institutions: These organisations tell the educational institutions the way
to prepare courses of study keeping in view the interest of consumers.

5. Promoting network of consumer association: Consumer organisations are trying to grow their
numbers. They want to cover all regions so that consumers of all regions get benefited by their
services.

6. Extending support to government: Consumer organisations by informing government

agencies about adulteration, artificiality, inferior quality products etc. This helps government to
conduct proceedings in time.

Role Of Consumer Coordinating Council

The name of the highest body of consumer Association is consumer coordinating council.
This body has started many programmes for consumer protection. The main objectives of this
council are:
(a) To establish coordination among consumers for their welfare.
(b) To educate and train activists working for consumer protection.

Role Of Press/Media

Whenever there is any revolution or a campaign is run for Public Awareness, News papers
and journals play a very significant role. Indian Express is the first for this noble cause. Press takes
following steps to make consumer protection campaign a success.
(a) To publish articles
(b) To make available columns
(c) To show live telecasts.
(d) To publish consumer complaints

Role Of Education Institutions

The importance of consumer protection is being realized at various levels of education Viz.
School, College, University. At school level institutions like C.B.S.E. had prepared syllabus in
which central guiding points of consumer protection have been highlighted. Similarly at University

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level INDIRA GANDHI NATIONAL OPEN UNIVERSITY (IGNOU) has prepared a special
course for under graduate and post- graduate students.

Role Of Consumer Protection Council

The consumer protection council provides the establishment of a Central Consumer

Protection Council by the central government and state Consumer Protection Council by state
governments. The main objectives of the councils are:
1. To protect the rights of consumer
2. To promote the rights of consumer

 NEED AND REASONS OF CONSUMERISM

 The need of strong consumerism in our country is on account of the following reasons:

1. In vast country like India, it is very difficult to organize the consumers. The people besides
being the backward have linguistic, cultural and religious difference which makes the
problems quiet intricate or complex.

2. Majority of our population is illiterate, uneducated, ignorant and ill-informed.

3. Poverty, lack of social awareness, accepting life as it is and passive outlook are some of
the factors which make consumer movement difficult to increase.

4. There may not be a positive common objective for the consumers except their desire for
safe quality products, for reasonable price and a feeling of strong negative reactions
against the products. In wake of large scale production and the variety and choice
conferred on the consumers, a consumer needs guidance which can only be appropriately
provided by a consumer organization.

5. The advertisement bombarded on the consumers make them quite confused and hence
again a need for consumer guidance.

RIGHTS OF CONSUMERS

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 INTRODUCTION

Before the mid-twentieth century, consumers were without rights with regard to their
interaction with products and commercial producers. Consumers had little ground on which to
defend themselves against faulty or defective products, or against misleading or deceptive
advertising methods.

Consumer rights are now an integral part of our lives like a consumerist way of life. They
have been well documented and much talked about. We have all made use of them at some point in
our daily lives. Market resources and influences are growing by the day and so is the awareness of
one's consumer rights. These rights are well-defined and there are agencies like the government,
consumer courts and voluntary organisations that work towards safeguarding them. While we all
like to know about our rights and make full use of them, consumer responsibility is an area which
is still not demarcated and it is hard to spell out all the responsibilities that a consumer is supposed
to shoulder. In this chapter, we will give an overview of the 8 consumer rights, their implications
and significance for a developing country like India, and also define the various aspects of
consumer responsibility.

In the 20th century, the presence and influence of the market grew dramatically in consumer
life. We began to purchase things from the market for a price. Soon, mass production and
industrial production came into being, giving the consumer world an entirely new dimension. Have
you ever wondered how much urban consumers depend on the market for fulfillment of even their
basic needs. This over-dependence on the market and the inherent profit motive in mass production
and sales has given manufacturers and dealers a good reason to exploit consumers. As a consumer,
you would know how market products are constantly under-weight, of inferior quality and do not
prescribe to quality standards specified by quality-control agencies. Consumers not only do not get
value for their money but also often have to suffer losses and inconvenience due to market
manipulations.

As Under section-6 of Consumer Protection Act, consumer has the following

rights:

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1. Right to safety:

It is Right to safety against such goods and services as are hazards to health, life and
property of the consumer. For e.g. some Indian products carry the ISI mark, this is a symbol of
satisfactory quality of a product. Similarly, the FPO and AGMARK symbolize standard quality of
food products. For example, spurious and sub-standard drugs ; appliances made of low quality of
raw material, such as, electric press, pressure cooker, etc. and low quality food products like bread,
milk, jam, butter etc.Consumers have the right to safety against loss caused by such products.
Right to safety is an important consumer right since it directly affects the health and quality of life
of consumers.

2. Right to be Informed/ Right to Representation:

Consumer has also the right that he should be provided all those information on the basis of
which he decides to buy goods or services. This information relates to quality, purity, potency,
standard, date of manufacture, method of use, etc. of the commodity. Thus, producer is required to
provide all these information in a proper manner, so that consumer is not cheated.

Recently, it has come to light that most cosmetics like lipsticks, kajal and mascara are
tested on animals in laboratories to see whether they have any adverse effects on them or no. There
was also a controversy about how Nike shoe company was using sweat labour in South Asian
countries, paying its workers abysmally low wages for manufacturing shoes. Similarly, there was a
‘McLibel' case against McDonald's alleging that Mc Donald's generated a lot of unwanted waste
due to its excessive packaging and harmed the environment.

3. Right to choose:

Consumer has the full right to buy good or services of his choice from among the different
goods or services available in the market. In other words, no seller can influence his choice in an
unfair manner. If any seller does so, it will be deemed as interference in his right to choice.

For e.g. American consumers can choose from 25,000 super market items, 200 kinds of
cereals, and read 11,092 magazines. This kind of choice often gives consumers a sense of well-
being and safety and encourages them to believe that abundance leads to good living.

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The right to choose must essentially be a consumer's right to choose a safe and healthy
product of good quality over an unsafe or defective product. This can give a consumer immense
leverage not just to choose products that are safe but also to influence the practices adopted
my the market. 

4. Right to be Heard:

Consumer has the right that his complaint be heard. Under this Right the consumer can file
complaint against all those things which prejudicial to his interest. First there rights mentioned
above (Right to Safety; Right to be Informed; Right to choose) have relevance only if the
consumer has right to file his complaint against them. These days, several large and small
organisations have set up Consumer service cells with a view to providing the right to be heard to
the consumer. The function of the cell is to hear the complaints of the consumers and to take
adequate measures to redress them. Many newspapers like The Economic Times have weekly
special columns to entertain the complaints of the consumers.

For e.g. if you have been cheated in the market place or deprived of the right quality of
service, your complaint should be heard and given due attention by the authorities.

Consumers should also have a right to voice their opinion when rules and regulations
pertaining to them are being formulated, like the recent amendments in the Consumer Protection
Act. The right to be heard holds special significance in the Indian context because Indian
consumers are largely unaware of their rights and passively accept their violation. Even when they
have legal recourse, they prefer not to use it for fear of getting embroiled in legal complexities.

5. Right to Seek Redressal:

This provides compensation to consumer against unfair trade practice of the seller. For
instance, if the quantity and the quality of the product do not confirm to the promise of the seller,
the buyer has the right to claim compensation, such as free repair of the product, taking back of the
products, changing of the product by the seller.

Competition is the by-product of the market economy. Everyday, manufacturers are

discovering newer ways of cheating and duping consumers. Unscrupulous market practices are
finding their way into consumer homes, violating consumer rights and jeopardizing their safety. It

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is to protect consumer interests that consumers have been given the right to obtain redress. In
India, we have a redress machinery called Consumer Courts constituted under the Consumer
Protection Act (1986), functioning at national state and district levels. But it has not been made
complete use of under due to lack of awareness of basic consumer rights among consumers
themselves.

6. Right to consumer education:

Consumer education refers to educate the consumer constantly with regards to their rights.
In other words, consumers must be aware of the rights they enjoy against the loss they suffer on
account of goods and services purchased by them. Government has taken several measures to
educate the consumers.

For instance, Ministry of civil supplies publishes a quarterly magazine under the title
“Upbhokta Jagran”. Doodarshan telecasts programme tittles “Sanrakshan Upbhokta Ka”,
“Jago Grahak Jago”

For instance, a woman who makes purchase decisions for the household and does the
actual buying in the marketplace would be more educated about market conditions and ‘best buys'
than a person who educates himself about the market with the help of newspapers or television.
Also, today, it is not just the market or products that a consumer needs to educate himself about
but s/he also needs to know about company profile, government policies and introduction of new
technology.

In the Indian context, sustainability and traditional knowledge can play a vital role in
empowering consumers but consumers are unable to connect to their knowledge base. Consumer
education can rejoin the broken link and make traditional knowledge accessible to consumers
again. Some sources of consumer education are past experiences of consumers, information
dissemination by government agencies and NGOs, classroom teaching by teachers and informal
lessons by parents.

In addition to this six rights of consumer given by govt. of India, the United
Nations organization also given two rights:

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1. Right to Basic Needs:

The Basic need means those goods and services which are necessary for the dignified
living of people. It includes adequate food, clothing, shelter, energy, sanitation, health, care,
education and transportation. All consumers have the right fulfill these basic needs.

2. Right to Healthy Environment:

This right provides consumers the protection against environment pollution so that the
quality of life enhanced. Not only this, it also gives stress that the need to protect the environment
is for future generations as well.

Consumer’s Responsibilities with rights:

The consumers have a number of rights regarding the purchase of things, but at the same
time they have some responsibilities too. It means that the consumer should keep a few things in
mind while purchasing them. They are as follows:

1. Consumer should exercise his right: Consumers have many rights with regard to the goods
and services. They must be aware of their rights while buying. These rights are: Right to
safety, Right to be informed, Right to representation, Right to seek redressal, Right to
consumer education, etc.

2. Cautious consumer/ do not buy blindly: The consumers should make full use of their
reason while buying things. They should not take the seller’s word as final truth. In other
words, while buying consumer must get information regarding the quality, quantity, price,
utility etc. of goods and services.

3. Filing complaint for the redressal of genuine grievances: It is the responsibility of a

consumer to approach the officer concerned there is some complaint about the goods

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purchased. A late complaint may find that the period of guarantee/warrantee has lapsed.
Sometimes, consumers ignore the deception of businessmen. This tendency encourages
corrupt business practices.

4. Consumer must be quality conscious/Do not compromise on quality: The consumers

should never compromise on the quality of goods. Therefore, they should not buy inferior
stuff out of greed for less prices. If the consumers behave like this, there cannot be any
protection for them from any quarter. It is also the responsibility of the consumers only to
buy goods with the ISI, Agmark, Woolmark, and FPO etc. printed on them. All these
symbols indicative of the good quality of the goods.

5. Advertisements often exaggerate/Beware of false advertisement: The seller informs the

consumer about their things through the medium of advertisement. The sellers exaggerate the
quality of their goods. Therefore, it is the responsibility of the consumers to recognize the
truth of advertisement.

6. Do not forget to get Receipt and Guarantee/warrantee card: One should always get a
receipt or bill for the things purchased. In case a guarantee/warrantee card is also offered by
seller, it should also be taken. In case the goods purchased are of inferior quality or some
defects appears and bothers the customers, these documents will be of great help in settling
all kinds of dispute with the seller.

7. Do not buy in hurry: The first important responsibility of consumers is that they should not
buy in hurry. It means that the consumers should make an estimate of the things they want to
buy their along with their quantity required by them. They should also take in consideration
the place from where to buy the things.

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Consumer protection councils

The Consumer Protection Act postulates establishment of Consumer Protection Councils at

the Central and State levels for the purpose of spreading consumer awareness. The objects of the
Councils, as per the Act, shall be to promote and protect 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, as the case may be so as to protect the consumer against unfair trade
practices;
 The right to be assured, wherever possible, access to a variety of goods and services at
competitive prices;
 The right to be heard and to be assured that consumer's interests 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 and
 The right to consumer education.

1. Central Consumer Protection Council

The Consumer Protection Act empowers the Central Government to establish a Central
Consumer Protection Council consisting of the Minister in charge of consumer affairs in the
Central Government as its Chairman and such number of other official and non-official members
representing such interests as may be prescribed. Under the Consumer Protection Council Rules
1987, the membership of the Council is restricted to 150 members including the Central Minister
in charge of Consumer Affairs as the Chairman. The term of the Council is three years. To monitor
the implementation of the recommendations of the Council, the Central Government may
constitute a standing working group from amongst the members of the council under the
Chairmanship of the Member Secretary of the Council. The Council shall meet as and when
necessary, but at least one meeting of the Council shall be held at such time and place as the
Chairman may think fit.

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2. State Consumer Protection Council

The Consumer Protection Act provides for the establishment of State Consumer
Protection Councils by the State Governments. The State Council shall consist of a Minister in
charge of consumer affairs in the State Government as its Chairman and such number of other
official or non-official members representing such interests as may be prescribed by the State
Government and Ten nominees of the Central Government. The State Council shall meet as
and when necessary but not less than two meetings shall be held every year at such time and
place as the Chairman may think fit.

3. District Consumer Protection Council

In order to promote and protect the rights of consumers, within the district, the Consumer
Protection Act, provides for the establishment of a District Consumer Protection Council in every
district. It shall consist of the Collector of the district as its Chairman and such number of other
official and non-official members representing such interests as may be prescribed by the State
Government. It shall meet as and when necessary but not less then two meetings shall be held
every year. The Chairman shall decide the time and place of the meeting.

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[B] Three tier consumer disputes redressal system

The Consumer Protection Act provides for three tiers Consumer Dispute Redressal System
encompassing the District, State and National Lavels.There are, thus, two levels of agencies in the
State and one agency at the National level. In other words, the act provide for the establishment of
following Consumer Disputes Redressal agencies.

1. District Consumer Dispute Redressal forum:

District Consumer Dispute Redressal forum popularly known as a District forum consist of
One President and two other members. "District Forum" by State Government. At least one in
each district or in certain cases one District Forum may cover 2 or more districts.

 This shall consist of:

1. A person who is, or has been, or is qualified to be a District Judge, its President

2. Two other members shall be persons of ability, integrity and standing and have adequate
knowledge or experience or have shown capacity, in dealing with problems relating to
economics, law, commerce, accountancy, industry, public affairs or administration,one of
whom shall be a woman.

 Jurisdiction of the District Forum

The District Forum shall have jurisdiction to entertain complaints where the value
of services and compensation claimed does not exceed Rupees 5 Lakhs. Manner in which
complaint shall be made.

 Current Jurisdiction of the District Forum

The amendments to the Consumer Protection Act that came into effect on
17TH DECEMBER, 2002 have brought about a number of changes in the jurisdiction of the
consumer courts. For example, the pecuniary jurisdictions of the District consumer Disputes
Redressal Forums have been raised from Rs. 5 lakhs to Rs. 20 lakhs.

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In other words, most complaints can now be filed before the District Forums, as
they can adjudicate on cases where the claims go up to Rs. 20 lakhs.

 A complaint may be filed with a District Forum by -

1. The consumer to whom such service is provided or is agreed to be provided;

2. Any recognized consumer association, whether the consumer to whom the service is
provided or is agreed to be provided is a member of such association or not ;

3. one or more consumers, where there are numerous consumers having the same interest,
with the permission of the district forum, on behalf of or for the benefit of all consumers so
interested ;

4. The Central or the State Government.

 Procedure on receipt of Complaint

The District Forum shall on receipt of a complaint -

1. Refer a copy of such complaint to the opposite party directing him to give his version of the
case within a period of 30 days or such extended period not exceeding 15 days as may be
granted by the District Forum ;

2. Where the opposite party, on receipt of a copy of the complaint, denies or disputes the
allegations contained in the complaint, or omits or fails to take any action to represent his
case within the time given by the District Forum, the District Forum shall proceed to settle
the consumer dispute,

I. On the basis of evidence brought to his notice by the complainant and the opposite
party, where the opposite denies or disputes the allegations contained in the complaint;
or

II. On the basis of evidence brought to its notice by the complainant where the opposite
party omits or fails to take any action to represent his case within the time given by the
Forum;

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III. Where the complainant or his authorised agent fails to appear before the District Forum
on such day, the District Forum may in its discretion either dismiss the complaint in
default or if a substantial portion of the evidence of the complainant has already been
recorded, decide it on merits. Where the opposite party or its authorised agent fails to
appear on the day of hearing, the District Forum may decide the complaint ex-parte.

IV. Where any party to a complaint to whom time has been granted fails to produce his
evidence or to cause the attendance of his witnesses or to perform any other act
necessary to the further progress of the complaint, for which time has been allowed, the
District Forum may notwithstanding such default :-

(a) If the parties are present, proceed to decide the complaint forthwith; or

(b) if the parties or any of them is absent, proceed as mentioned above in (b) (iii) ;

V. The District Forum may, on such terms as it may think fit at any stage, adjourn the
hearing of the complaint but not more than one adjournment shall ordinarily be given
and the complaint should be decided within 90 days from the date of notice received by
the opposite party where complaint does not require analysis or testing of the goods and
within 150 days if it requires analysis or testing of the goods.

 Findings of the District Forum

If, after the proceedings, the District Forum is satisfied that any of the allegations contained
in the complaint about the services are proved, it shall issue an order to the opposite party directing
him to do one or more of the following things:

1. To return to the complainant the charges paid.

2. Pay such amount as may be awarded by it as compensation to the consumer for any loss
or injury suffered by the consumer due to the negligence of the opposite party.

3. To remove the deficiency in the services in question.

4. To provide for adequate costs to parties.

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 Appeal against orders of the District Forum

Any person aggrieved by an order made by the District Forum may appeal against such
order to the State Commission within a period of 30 days from the date of the order. The State
Commission may entertain an appeal after 30 days if it is satisfied that there was sufficient cause
for not filing it within that period.

If Consumers are not satisfied the result of district forum so they can go to the State Forum
and National Forum.

2. State Consumer Dispute Redressal forum:

State Consumer Dispute Redressal forum no one has a State Commission is next hierarchy of
Consumer Redressal forum Under Consumer Protection Act.

 It shall consist of -

1. A person who is or has been a Judge of a High Court, who shall be its President;
2. Two other members.

To other members who shall be persons of ability integrity and standing and have adequate
knowledge or experience of, or have shown capacity in dealing with problems relating to
Economics, Law, Commerce, Accountancy, Industry, Public affairs of administration, One of
whom shall be woman: provided that every appointment made under this clause shall be made by
the government of recommendation of selection committee consisting of the following namely.

I. President of the State Commission Chairman.

II. Secretary of the Law Department of the State Member.

III. Secretary, In charge of Department Dealing with Consumer Affairs in the State Member.

 Jurisdiction of the State Commission

The State Commission has jurisdiction to entertain -

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1. Complaints where the value of services and compensation claimed exceeds rupees 5 lakhs
but does not exceed rupees 20 lakhs;

2. Appeals against the orders of any District Forum within the state ;

3. Revision petitions against the District Forum.

 Current Jurisdiction of the State Commission

The pecuniary jurisdictions of the State Consumer Disputes Redressal Commissions have
gone up. So all claims above Rs. 20 lakh and up to a limit of Rs. 1 crore can now be made before
the commissions located in State capitals. The highest Consumer Disputes Redressal Commission
will now hear cases where the claims are above Rs. One crore.

 Procedure to be followed by State Commission

Same as for District Forum.

 Procedure for hearing appeals

The State Commission may, on such terms as it may think fit and at any stage, adjourn the
hearing of appeal, but not more than one adjournment shall ordinarily be given and the appeal
should be decided within 90 days from the first date of hearing.

 Appeals against orders of State Commission

Any person aggrieved by an order made by the State Commission may appeal against such
order to the National Commission within a period of 30 days. The National Commission may
entertain an appeal after 30 days if it is satisfied that there was sufficient cause for not filing it
within that period.

If Consumers are not satisfied the result of District forum or State Forum so they can go to
the National Forum.

3. National Consumer Dispute Redressal forum:

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National Consumer Dispute Redressal forum popularly known as National Commission is

the top most layer in the three level hierarchy. It was constituted in the year 1988.

 This shall consist of -

1. A person who is or has been a Judge of the Supreme Court, who shall be its President.
(No appointment under this clause shall be made except after consultation with the Chief
Justice of India).

2. 4 other members (qualifications: As for District Forum /State Commission).

The President should be one who is or has been a judge of Supreme Court; the member
should be persons of eminence in Economics, Law, Commerce, Accountancy, Industry, Public
Affairs or Administration.

In order to attain the object of the CPA, the National Commission has also been giving
sufficient powers of administrative control over all the same commission by calling for periodical
returns regarding the institution, disposal and perdency of cases. It is empowered to issue
instructions regarding:

1. Adoption of uniform procedure in the hearing of the meters.

2. Prior services of copies of documents produced by one party to the opposite

parties.

3. Speedily Grant of copies of document.

4. Generally overseeing the functioning of the state commission or the district forum
and ensure that the object and purpose of the act are best serve without interfering
with there quasi-judicial freedom in any way.

 Jurisdiction of the National Commission

The National Commission shall have jurisdiction –

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a) To entertain

i. Complaints where the value of services and compensation claimed exceeds rupees 20
lakhs ; and

ii. Appeals against the orders of any State Commission.

(b) To entertain revision petition against the State Commission.

 Current Jurisdiction of the National Commission

If the cost of goods or services and compensation asked for exceed rupees one crore then
the complaint can be filed before the National Commission at New Delhi.

 Procedure to be followed by the National Commission

A complaint containing the following particulars shall be presented by the complainant in

person or by his agent to the National Commission or be sent by registered post, addressed to the
National Commission :-

1. The name, description and the address of the complainant;

2. The name, description and address of the opposite party or parties, as the case may be, so
far as they can be ascertained ;

3. The facts relating to the complaint and when and where it arose ;

4. Documents in support of the allegations contained in the complaint ;

5. The relief which the complainant claims.

The remaining procedure and the procedure for hearing the appeal is similar to that for State
Commission.

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 Appeal against orders of the National Commission

Any person, aggrieved by an order made by the National Commission, may appeal against
such order to the Supreme Court within a period of 30 days from the date of the order. The
Supreme Court may entertain an appeal after 30 days if it is satisfied that there was sufficient cause
for not filing it within that period.

 Limitation Period
The District Forum, the State Commission or the National Commission shall not admit a
complaint unless it is filed within 2 years from the date on which the cause of action has arisen. In
case there are sufficient grounds for not filing the complaint within such period, extension may be
granted.

 Dismissal of frivolous or vexatious complaints

Where a complaint instituted before the District Forum, the State Commission or the
National Commission, as the case may be, is found to be frivolous or vexatious, it shall, for
reasons to be recorded in writing, dismiss the complaint and make an order that the complainant
shall pay to the opposite party such cost, not exceeding 10,000 rupees, as may be specified in the
order.

Penalties

Where a person against whom a complaint is made or the complainant fails or omits to
comply with any order made by the District Forum, the State Commission or the National
Commission, as the case may be, such person or complainant shall be punishable with
imprisonment for a term which shall not be less than one month but which may extend to three
years, or with fine which shall not be less than 2,000 rupees but which may extend to 10,000
rupees or with both. In exceptional circumstances the penalties may be reduced further.

Who can file a complaint

The following can file a complaint under the Act:-

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 A consumer
 Any voluntary consumer organization registered under the Societies Registration Act,1860 or
under the Companies Act,1956 or under any other law for the time being in force.
 The Central Government.
 The State Government or Union Territory Administrations.
 One or more consumers on behalf of numerous consumers who are having the same interest
(Class action complaints)

How to register the complaints? 

 Complaint can be registered within 2 years from the date on which the cause of
action has arisen.

 Stamp paper is not required for declaration.

 Complaint can be registered in person by the complainant or through his authorised

agent or by post addressed to the Redressal Agency.

 Lawyers are not necessary.

The complaint should contain the following particular:

1. The name and complete address of the complainant

2. The name and complete address of the opposite party/parties

3. Date of purchase goods or services availed

4. Amount paid for the above purpose

5. Particulars of goods purchased with numbers or details of services availed

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6. The details of complaint, whether it is against Unfair Trade Practice / supply of

defective goods / deficiency in service provided / collection of excess price,
should explicitly be mentioned in the complaint petition.

7. Bills / receipts and copies of connected correspondence, if any,

8. The relief sought for under this Act

RELIEF AVAILABLE TO CONSUMER

Depending on the facts and circumstances, the Redressal Forums may give order for one
or more of the following relief.

 Removal of defects from the goods,

 Replacement of the goods;
 Refund of the price paid;
 Award of compensation for the loss or injury suffered;
 Removal of defects or deficiencies in the services;
 Discontinuance of unfair trade practices or restrictive trade practices or direction not
 To repeat them;
 Withdrawal of the hazardous goods from being offered to sale; or
 Award for adequate costs to parties.

 Conclusion

The Consumer Protection Act, 1986 which was modified by amendment act of 1993, is a
very important means to protect the consumer rights. However, the effective functioning of the

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Consumer Redressal Agencies and, consequently, the achievement of its objectives, are hindered
by several problems.

The Post of President and / or other members of the for a remaining vacant are not
uncommon. Many redressal agencies are not adequately staffed. They also suffer from financial
problems.

Consumer protection laws are federal and state statutes governing sales and credit practices
involving consumer goods. Such statutes prohibit and regulate deceptive or unconscionable
advertising and sales practices, product quality, credit financing and reporting, debt collection,
leases, and other aspects of consumer transactions.

The goal of consumer protection laws is to place consumers, who are average citizens
engaging in business deals such as buying goods or borrowing money, on an even par with
companies or citizens who regularly engage in business. Historically, consumer transactions—
purchases of goods or services for personal, family, or household use — were presumed fair
because it was assumed that buyers and sellers bargained from equal positions. Starting in the
1960s, legislatures began to respond to complaints by consumer advocates that consumers were
inherently disadvantaged, particularly when bargaining with large corporations and industries.
Several types of agencies and statutes, both state and federal, now work to protect consumers.

We believe the more guidelines are required because there are always two sides of a coin,
each instance of Consumer affairs could be easily termed as another ‘Consumer mistreatment’. By
the time market forces have time to operate, far too many consumers are dead, maimed, or
impoverished. Within a nation-state, national laws may prevent some of this harm, but once
national boundaries are crossed, their effectiveness is limited, and consumers can hope for very
limited protection, If online trade proliferates and consumer fraud becomes a major problem,
nation-states and commercial interests that provide online access are fairly restricted in the action
they may take to curb unacceptable and deleterious practices.

“Consumer is the king of market, if he is getting exploited than the market will be ruined.”

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