Consumer Protection "The purpose of any business is to create a customer. It is the customer who determines what a business is.

It is the customer and he alone, who, through being willing to pay for a good or services, convert economic resources into wealth, things into goods. What a business thinks it produces is not of first importance - especially not to the future of the business and to its success. What the customer thinks he is buying - what he considers value, is decisive; it determines what a business is, what it produces and whether it will prosper". (Peter F. Drucker).

Consumerism The term 'consumerism' is related to the consumer movement launched in the mid-1960s by the concerns triggered by Rachel Carson and Ralph Nader's auto safety investigation and by the then US president John F. Kennedys efforts to establish the consumer's rights to safety, to be informed, to choose and to be heard.Thus, consumerism is a movement directed to protect the consumer and ensure that the consumer gets the best return in exchange for the money he spends. Factors Responsible for Imbibing the Consumer Protection Movement The International Organisation of Consumers Union, Penang, has highlighted five factors that are responsible for evoking the demand for consumer protection:

a.Ever increasing complexity of legislative controls and goods. b.Altered patterns of communication. c.Need for informed participation. d.Fundamental innovations. e.Problem of development. In the Indian scenario the following factors can said to be reasons for the rise of the consumer protection movement: i. Consumer Information Gap ii.Pattern of Communication iii.Performance Gap iv.Absence of informed Participation v.Budget Squeeze and Inflation vi.Poverty of Consumers Consumer education for our country is a must for the: i. Creation of critical awareness ii.Active consumer involvement iii.Imbibing social responsibility iv.Realising ecological responsibility v.Consumer Solidarity Consumer Rights Every year, March 15 is observed as"World Consumer Right Day". Its significance is that in 1962 on this day, John Fitzgerald Kennedy, the then president of the US declared four consumer rights. Later, International Organisation of Consumers Union (IOCU) added three more rights to the list.

The government of India too included these rights in its 20-point programme. These have also been incorporated in the United Nations Charter of Human Rights.These are: 1.Right to Safety 2.Right to be Informed 3.Right to Choose Mentioned by President Kennedy 4.Right to be Heard 5.Right to Redress 6.Right to Healthy Environment Added by International Organization of 7.Right to Consumer Education Consumers Union (IOCU) Consumer Protection Act 1986 The Consumer The term 'consumer' is defined in Section 2(d) of the Consumer Protection Act, 1986 in two parts. One is a consumer who purchases goods, the other is a person who hires services. a."Consumer"means any person who: i. Buys any goods for a consideration that has been paid or promised or partly paid and partly promised, or under system of deferred payment and includes any user of such goods (other than the person who buys such goods) for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of the buyer.

But it does not include a person who obtains such goods for resale or for any commercial purpose.* ii.Hires or avails of any services for a consideration that has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary or such services other than the person who hires or avails of the services for consideration paid Aims and Objectives of the Act The main objective of the Act (according to preamble to the Act) is to provide for better protection of the interest of consumers. Consumer councils and other authorities have been set up for settling the consumers' disputes and other matters.The objective of the Act of 1986 is as follows: 1.The foremost objective of the Consumer Protection Bill is to provide for better protection of the interest of the consumer and for that purpose, to make provisions for the establishment of Consumer Protection Councils and other authorities for the settlement of consumer disputes and for matters connected therewith. 2.The Act provided that for speedy and simple redressal at minimum expenses to consumer disputes, a quasi-judicial body is to be set up at the district, state and central levels Grounds for Appeal for the Jurisdiction to Redressal Forums

Consumers can appeal for jurisdiction to the consumer redressal forums upon any of the five grounds: a. Consumer Actand Unfair Trade Practices b.False Offer or Bargain Price c.Offering of Gifts, Prizes etc.,and Conducting Promotional Contests d.Product Safety Standards e.Hoarding or Destruction of Goods Act

Restrictive Trade Practices Section 2(1) (nn) of the Act provides that"restrictive trade practice" means"any trade practice which requires a consumer to buy, hire or avail of any goods or, as the case may be, services as a condition precedent for buying, hiring or availing of other goods or services". Goods and Defect [Section 2 (1)(i)&(f)] Goods:The consumer protection act doesn't define the term 'goods'. It says that 'goods' means that as defined in the Sale of Goods Act, 1930. Section 2(7) of the Sale of Goods Act defines it such:"Goods means every kind of movable property other than actionable claims and money, and includes stock and shares, growing crops, grass , and things attached to or forming part of land which are agreed to be severed before sale or under the contract of sale". Defect: Under Section 2(1)(f) of the Act 'defect' means -"any fault, imperfection or shortcoming in quality potency, purity or standard which is required to be maintained by or under any law, for the time being in force or as is claimed by the trader in any manner whatsoever in relation to the goods."

Deficiency in Services [Section 2(1)(o)& (g)] Deficiency in Service:According to Act"deficiency means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service. Charging of Excessive Price over thatFixed by Law or Displayed A complaint may be made against a trader who has charged in excess of the price: 1.Fixed by or under any law for the time being in force, or 2.Displayed on the goods, or 3.Displayed on any package containing the goods. HazardousGoods The consumer protection act in spite of recognising the right of consumer to be protected against marketing of goods, which are hazardous to life and property did not provide any preventative mechanism in favour of the consumer.The term 'hazardous goods' has not been defined in the AcWho can File a Complaint [Section 2 (b) & 12] A complaint in reference to any goods sold or delivered or services rendered may be filed by any of the following: a.By the consumer himself to whom such goods have been sold or delivered or such service rendered; b.Any voluntary consumer association registered under Companies Act, 1956 or under any other law for the time being in force; or

c.One or more consumers, where there are numerous consumers having the same interest; d.The Central and state government. In addition to the above, the following are also considered as a consumer an hence they may file a complaint: Beneficiary of goods/services, legal representative of the deceased consumer, legal heirs of the deceased consumer, spouse of the consumer, a relative of consumer, and insurance company T Relief Available Against Complaint [Section 14 & 22] If the firmis convinced that the goods were really defective or that the complaint about the service is proved, the forum shallhave to order any of the following things to be done by the opposite party: a.To remove the defect pointed out by the appropriate laboratory for the goods in question. b.To replace the goods with new goods of similar description that shall be free form any defect. c.To refund to the complainant the amount paid as price, or as the case may be, the charges paid by the complainant. d.To 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. e.To remove the defects or deficiencies in the services in question.

f. To discontinue the unfair trade practice or the restrictive trade practice or not to repeat it. g.Not to offer the hazardous goods for sale Consumer Protection Councils These councils work towards the promotion and protection of consumers. Consumer councils are created to advise and assist the consumers in seeking and enforcing their rights. We have consumer protection councils both at the center level and state level. Central Consumer Protection Council The Central government was authorised to establish the Central Council that has come to existence w.e.f. April 15, 1987 through the framing of the (Central) Consumer Protection Rules (1987). Composition [Section 2 and Rule 3] Member of the councils are selected from various areas of consumer interest, who are whenever possible, leading members of statewide organizations representing segments of the consumer public, so as to establish a broadly- based representative consumer council State Consumer Protection Council Under Section 7 of the Act, state governments are required to establish their respective protection councils.The rules regarding its composition and other modalities are to be established by the respective state government.The objectives of the State Consumer Protection Council are described in Section 7 to be the same as those of the Central Council, namely, the points enumerated in Section 6.

Working Groups The Central government may constitute from amongst the members of the Council a standing Working Group, under the Chairmanship of the Member Secretary of the Council.The Standing Working Group shall consist of not more than 30 members and shall meet when considered necessary by the Central government. Consumer Disputes Redressal, Agencies Under the Consumer Protection Act, 1986 (CDRA) Under this Act, Consumer Disputes Redressal Agencies have been established. The Consumer Protection Act provides for a 3-tier approach in resolving consumer disputes.These three tiers are: 1.A Consumer Disputes Redressal Forum to be known as the"District Forum".This is to be established by the state government in each district of the state by means of a notification. 2.A Consumer Disputes Redressal Commission to be known as the"State Commission".This has also to be established by the state government in the state by means of a notification. 3.A National Consumer Disputes Redressal Commission to be established by the Central government by means of a notification. The Act thus envisages a hierarchy of three redressal forums: District Forum State Forum National Forum

Jurisdiction The question of has to be jurisdiction considered with reference to the value, place, and nature of the subject matter: District Forum:A District Forum deals with cases where the value of claim is upto Rs. 5 lakhs. Territorial Jurisdiction:A case is supposed to fall within the purview of District Council when, at the time of the institution of the complaint: a.The party against whom the claim is made actually and voluntarily resides or carries on business, or has a branch office or personally works for gain in that area, or b.Where there are more than one opposing or contesting parties , each such party actually and voluntarily resides or carries on business or c.Where there are more than one opposing or contesting parties, and any such party actually and voluntarily resides or carries on business or has a branch office, or personally works for gain in that area; provided the other parties not so residing or working agrees. d.The cause of action, wholly or in part, arises in that area State Commission Cases having a claim exceeding rupees 5 lakhs but upto the limit of Rs. 20 lakhs can go to the State Commission. The Consumer Protection Act does not specifically provide for the territorial jurisdiction of the State Commission. Broadly, these are on similar lines on which the territorial jurisdiction of district forum is based.

National Commission National Commission is the highest level of consumer forums. It may entertain all matters where the value of claim exceeds Rs. 20 lakhs.The territorial jurisdiction of the National Commission is whole of India except the state of Jammu & Kashmir.