Consmer Protection Act

The Consumer Protection Act, 1986 sought to provide better protection to the interests of
the consumers and for that purpose made provisions for the establishment of Consumer
Protection Councils and other authorities for resolving consumers’ disputes. The Consumer
Protection Councils would be set up at national and state levels (Section 6 of Consumer
Protection Act)

It attempts to remove the helplessness of the consumer which he faces against powerful
business described as a network of rackets or a society in which producers have secured power,
to 'rob the rest of the public bodies.

According to the preamble of the Act, the Act was enacted, to provide protection of the interest
of consumers.

The Act thus aims to protect the economic interest of the consumer as understood in a
commercial sense as a purchaser of good and in the larger sense of services.

Aims and objectives of Consumer Protection Act:

Till the 1960s, India was plagued with cases of black marketing, hoarding, inadequate weighing
and food adulteration. These were problems that affected the well-being of the consumer and
amount to consumer exploitation.

The consumer movement began in the 1960s and gained momentum in the 1970s. Consumer
dissatisfaction started to be demonstrated through the written word and in articles and
newspapers.

The level of dissatisfaction with sellers and manufacturers and their practices resulted in
consumers raising their voice. Resultantly, the government decided to give recognition to
consumer protection by enacting the Consumer Protection Act on 24th December 1986. The Act
was aimed at protecting the rights of the consumers and ensuring free trade in the market,
competition and accurate information to be available. This day is now observed as National
Consumers’ Day.
Consumer Rights

There are six broad consumer rights defined as per the Consumer Protection Act, 1986. These
are:

Right to Safety

The Consumer Protection Act defines this right as a protection against goods and services that
are ‘hazardous to life and property’. This particularly applies to medicines, pharmaceuticals,
foodstuffs, and automobiles. The right requires all such products of critical nature to life and
property to be carefully tested and validated before being marketed to the consumer.

Right to Information

This right mentions the need for consumers to be informed about the quality and quantity of
goods being sold. They must be informed about the price of the product and have access to other
information specific to the product that they wish to consume.

Right to Choose

The consumer must have the right to choose between different products at competitive prices.
Thus, the concept of a competitive market where many sellers sell similar products must be
established to ensure that the consumer can actually choose what to consume and in what
quantity. This is to avoid monopoly in the market.

Right to Seek Redressal

When a consumer feels exploited, he/she has the right to approach a consumer court to file a
complaint. A consumer court is a forum that hears the complaint and provides justice to the party
that has been hurt. Thus, if the consumer feels he/she has been exploited, they can approach the
court using this right.

Right to be heard

The purpose of this right is to ensure that the consumer gets due recognition in consumer courts
or redressal forums. Basically, when a consumer feels exploited, he has the right to approach a
consumer court to voice his complaint. This right gives him/her due respect that his/her complaint
will be duly heard. The right empowers consumers to fearlessly voice their concerns and seek
justice in case they are exploited.

Right to Consumer Education

Consumers must be aware of their rights and must have access to enough information while
making consumption decisions. Such information can help them to choose what to purchase,
how much to purchase and at what price. Many consumers in India are not even aware that they
are protected by the Act. Unless they know, they cannot seek justice when they are actually hurt
or exploited.

Consumer Protection Council and State Consumer Protection Council

Consumer forums or consumer protection councils are organizations that help represent
consumer interests. They guide consumers in the process of filing complaints in the court when
they are exploited and also help in spreading consumer protection awareness.

The objects of the Central Consumers Protection Council and State Consumers
Protection Councils are to promote and protect the rights of the consumers, such as:

(a) The right to be protected against marketing of goods and services which are hazardous to
life and property.

(b) 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.

(c) The right to be assured wherever possible, access to a variety of goods and services
at competitive prices.

(d) The right to be heard and to be assured that consumers’ interest will receive due
consideration at appropriate forum.

(e) The right to seek redressal against unfair trade practices or restrictive trade practices or
unscrupulous exploitation of consumers, and

(f) The right to consumer education.

Central Council (Sec. 4):

The Central Council will be composed of following members:

1. The Minister in charge of Consumer Affairs of the union government will be the
chairperson of the Council.

2. Such members official and non-official representing such interests as may be

prescribed.

The Central Council meets as and when necessary. At least one meeting shall be held every
year. The time and place of the meeting will be fixed by the Chairman. The procedure in regard
to the transactions of the business shall also be determined by the Chairman. (Sec 5).
State Council (Sec. 7):

A State Council shall be composed of the following members, namely,

1. The Minister in charge of Consumer Affairs of the state government will act as
Chairman.

2. Such members official and non-official representing such interests as may be prescribed
by the state government.

The State Council shall meet as and when necessary. The time and place of the meeting shall
be fixed by the Chairman. The Council shall observe such procedure regard to the transactions
of its business as may be prescribed by the state government. At least two meetings shall be
held every year.

1. The State Consumer Protection Council is known as “the State Council.”

2. Sections 7 and 8 of Chapter-II explain the provisions explain about the constitution and
objects of the State Council. Each State is authorized by its State Consumer Protection
Rules to establish one State Council for its territory.

3. The objects of State Council are to promote consumer movement and to safe guard the
consumer rights in a State. It is only recommendatory body.

4. The decisions of the State Council are recommendatory in nature.

5. It is purely administrative authority, filled up by the non-official and official members.

It functions as a Government department.

6. From the decisions of State Council, no appeal can be filed. Only an application may
be made to the Central Council for consideration. The Central Council too does not
possess the implementing powers of any decisions of its or of any State Councils.

7. Working Hours and Working Days are not prescribed by the Act. The State Council
shall have to conduct its meeting not less than two meetings in every year.

When can a complaint be filed?

A complaint may be made in writing under the following circumstances:

o Loss or damage is caused to the consumer due to unfair contract, unfair or

o restrictive trade practice of a trader or service provider;
 the article purchased by a consumer is defective;
 the services availed of by a consumer suffer from any deficiency;
 a trader or service provider, as the case may be, has charged for the goods
o or for the service mentioned in the complaint a price in excess of the
o stipulated price;
 Goods or services, which will be hazardous to life and safety, when used, are
o being offered for sale to the public;
 a claim for product liability action can also be made against the product
o manufacturer, product seller or product service provider, as the case may be;
Who can file a Complaint?
 Any consumer;
 Any voluntary consumer association;
 Central Government or any State Government;
 Central Authority;
 One or more consumers, where there are numerous consumers having same
o interest
 In case of death of a consumer, his legal heir or representative;
 In case of a consumer being a minor, his parent or legal guardian;
  Consumer Redressal Agencies
Composition of Consumer Redressal Agencies:

District forum:

According to Consumer Protection Act 1986 each District Consumer Forum set up in each
district of a State shall consist of a person who is or has been or is qualified to be a district
judge. This person will work as president of the district consumer forum.

Two eminent members who have adequate knowledge and experience and have the ability
in dealing with problems concerning law, commerce, economics, accountancy, industry,
public affairs or administration and one of whom shall be a lady member, especially who is a
social worker. One shall be a women

A District Forum has the jurisdiction to deal with the complaints where the value of good or
service and the compensation claimed, if any, does not exceed Rs. 20 lakh (as per amendment
in the Act in 2002). A complaint by consumers will be filed in a District Forum in case when
the opposite party or each of the opposite party if there are more than one resides or carries on
business within the district concerned at the time of filing the complaint or any one of the party
(if there are more than one) residing or carrying on business in the district at the time of the
filing of the complaint if the district forum grants permission for this.

The State Consumer Commission shall consist of:

(1) A person who is or has been a judge of a high court appointed by the State Government,

(2) Two other members of high standing and eminence who have adequate knowledge or
experience concerning the problems relating to law, commerce, economics, industry, public
administration etc. one of whom shall be a woman.

The State Consumer Commission as per the amendment of the Act in 2002 shall have the
jurisdiction to entertain complaints where the value of goods or services and compensation
claimed if any exceeds Rs. 20 lakh but is not more than Rs. 1 crore.

The State Consumer Commission will also entertain appeals against the orders of District
Forums within the State. Besides, the State Consumer Commissions have been authorized to
call for the records and give appropriate orders in case of any consumer dispute pending before
the District Forum within the State or has been decided by it if the State Commission finds
that a District Forum has exercised a power not vested in it by the Act or has failed to exercise
a power or jurisdiction vested in it or acted illegally in exercise of its powers.
The National Consumer Commission will consist of:

(a) A person who is or has been a judge of the Supreme Court and is appointed by the Central
Government in consultation with Chief Justice of India. He will also work as president of the
national commission,

(b) Four other members of eminence having good knowledge or experience and ability to deal
with the problems relating to commerce, economics, law, industry, public affairs or
administration and one of whom shall be a woman.

National Consumer Commission has the jurisdiction:

(1) To entertain complaints where the value of goods or services and compensation claimed if
any is, according to Amendment Act 2002, one crore or more;

(2) National Commission is authorized to hear appeals against the order of any State Consumer
Commission;

(3) The Central Commission has the right to call for the records from the State Commissions.

It is important to note that all forums, commissions appointed under the Consumer Protection
Act are in substantial matters not different from the ordinary civil courts. They are quasi-
judicial tribunals created to render speedy justice.

The Amendment by Consumer Protection Act, 2019

CPA 1986 (Earlier) CPA 2019(New)
District Forum: Up to 20 Lakh District
Commission: Upto
1 cr
State Commission: 20 Lakh – State Commission:
1 cr 1 cr – 10 cr
National Commission: Above National
1 cr Commission:
above 10 cr
This order byredressal agencies may be any of the following types:

1. To remove the defect if found to be true by the appropriate laboratory from the good in
question;

2. To replace the defective goods with the new goods of the same type free from the
defects;

3. To return to the complainant price of the defective good or charges paid by him;

4. To pay the compensation to the complainant as may be decided by the redressal agency
for the loss suffered by him;

5. To remove the defects or deficiencies in the service rendered to the individuals;

6. To stop the unfair or restrictive trade practice or give undertaking not to repeat in future;

7. Not to supply hazardous goods;

8. To withdraw the hazardous goods being offered for sale; and

9. To give adequate costs to the parties in question.

Penalties:

The Consumer Commissions are authorized to impose penalties on trader or person against
whom complaint is made if he fails to comply with the order of the redressal agency. The
penalty or punishment may involve imprisonment for a period not more than 3 years or a fine
of not more than 10 thousand rupees or both.

Features of Consumer Protection Act, 2019

Salient Features of the Act

 Wider Ambit to address New Emerging Challenges

The New Act equip the machinery to meet the new emerging challenges like e- commerce,
telemarketing, misleading advertisements, etc. and ensure efficiency in grievance redressal.
  Inclusion of e- Commerce

The earlier Act did not specifically include e-commerce transactions. This lacuna has been
addressed by the New Act. ‘E-commerce’ and ‘electronic service provider’ have been defined
under the Act. ‘E-commerce’ has been defined as buying or selling of goods or services
including digital products over digital or electronic network. The central government has been
authorized to take measures and make rules to prevent unfair trade practices in e-commerce.

 Broader Definition of Consumer

The definition of ‘consumer’ under section 2(7) is broader and includes both offline and
online transactions. The ambit of consumer has been widened to cover not only online
transactions but also telemarketing and multi-level marketing which will impose responsibility
at all levels.
  Flexibility in place of filing the cmplaint:

The New Act provides flexibility to the consumer to file complaints with the
consumer commission located at the place of residence or work of the consumer.

 E-Filing of Complaints

The New Act also enables consumers to file complaints electronically and for
hearing and/or examining parties through video-conferencing. This is to ensure
procedural ease and reduce inconvenience and harassment to the consumers.

 Establishment of Regulator for Consumer Protection

The New Act provides for establishment of the Central Consumer Protection
Authority (CCPA) to regulate matters relating to violation of rights of
consumers, unfair trade practices and false or misleading advertisements which
are prejudicial to the interests of public and consumers and to promote, protect
and enforce the rights of consumers as a class.
Penalties for voilation of the Aact and the provisions: