‘‘NEED FOR CONSUMER PROTECTION ACT IN

AN ERA OF FREE COMPETITION WHERE

‘CONSUMER IS A KING’ – SO KING NEEDS
PROTECTION’’
 INTRODUCTION:
o Consumer protection is a group of laws and organizations designed to
ensure the rights of consumers

o Consumer protection Act enacted in 1986

o Separate Consumer Dispute Redressal Forum have been set up

throughout India (in each and every district as well)

o The Consumer Protection Act, 1986 aims to provide better protection of

interest of consumers

o The Act extends to whole of India except the state of Jammu and
Kashmir
o The act was passed in Lok Sabha on 9th December,1986 and
Rajya Sabha on 10th December, 1986 and assented by the
President of India on 24th December, 1986

o This act was enforced on 15 April, 1987.

SOME IMPORTANT DEFINITIONS:

1. CONSUMER
2. GOODS

 Any person who buys  Movable property

goods or services for a including
consideration shares, stocks, growing
crops
 Any person means
individual  Forming part of the land
company, group/
association of people
 Excluding actionable
 User of such goods and claims and money
services
 Tangible in Nature
 3. SERVICES

4. COMPLAINT
 Service is made
available to potential
users  Complaint is a
statement made in
writing by a person
 Eg: Provision of competent to file it
facilities -
banking, financing, insu  It contains the
rance, transport, supply allegations in detail
of electrical
energy, board or/and
lodging  Made in view to obtain
relief
 COMPLAINT MUST
CONTAIN:
5. COMPLAINANT
 Unfair trade practice or a
restrictive trade practice  Consumer or consumers

 Goods having defects  Voluntary consumer

association
 Service having deficiency
 Government which may
 Excess price charged be Central or State

 Hazardous goods  In case of death: Legal

Heir, Beneficiary, Husban
d, Relative can file a
 Hazardous service complaint
NEED, PURPOSE AND OBJECTIVE OF CONSUMER
PROTECTION

Caveat Emptor TO Consumer Protection

NEED FOR CONSUMER PROTECTION

 Protection from Exploitation

 Consumer Education

 Redressal of Complaints

 A Connecting Link

 Quality Life for consumer

 Ethical Obligations
PURPOSE & OBJECTIVE OF CONSUMER
PROTECTION

 Protection of Consumer against unfair trade practices

 Protection of enjoying the rights

IMPORTANCE OF CONSUMER PROTECTION IN A
BUSINESS ORGANIZATION
 Public Image

 Social Responsibility

 Increasing Awareness

 Customer Satisfaction

 Government Intervention
RIGHTS OF THE CONSUMERS:

1. The Right To Safety

2. The Right To Choose

3. The Right To Information

4. The Right To Be Heard

5. The Right To Redressal

6. The Right To Consumer Education

7. The Right For Basic Needs

8. The Right For Healthy Environment

 1. THE RIGHT TO SAFETY
 Before purchasing, consumers should inspect on the quality of the products as well
as on the guarantee of the products and services.

 They should preferably purchase quality marked products such as

ISI, AGMARK, FPO, Hallmark etc.
 2. THE RIGHT TO CHOOSE
 The consumer before purchase a product needs to be made aware of:

o Variety of products and services

o Fair prices
o Quality
o Quantity
o Competition

 Knowing this the consumer can make his/her choice for the product
3. THE RIGHT TO INFORMATION
 The consumer has the right to be informed about the
quality, quantity, purity, standard and price of goods so as to protect
themselves against unfair trade practices.
 RTI & THE CONSUMER
PROTECTION ACT
 4. THE RIGHT TO BE HEARD

 The consumer has the right to be heard and be assured that their interests or
views or complaints will be considered at consumer forums

5. THE RIGHT TO REDRESSAL

 The right to seek redressal against unfair trade practices or restrictive trade
practices or exploitation of consumers
6. THE RIGHT TO CONSUMER EDUCATION
 The consumers should have access to informational programs and
materials that would enable them to make better buying decisions
7. THE RIGHT FOR BASIC NEEDS
 Every consumer has the right to get the quality basic needs such as
food, clothing and shelter.

BASIC NEEDS

25%

50%

Food
Shelter
Clothing
25%
8. THE RIGHT FOR HEALTHY ENVIRONMENT
 The manufacturer should aim at producing more environment friendly and
energy efficient products.

 The products which can be recycled has the following symbol:

NOTE: Rights number 7 & 8 have been added by the

amendment in the act in 1993 and 2002 respectively.
RESPONSIBILITIES OF A CONSUMER

 Be aware of various goods & services available in

the market
 Buy standardize products only (eg: ISI marked
products)
 Be aware of each & every aspect of the product
while purchasing it
 Buy legal products

 Ask & take the proof of the purchase

 File a complaint in an appropriate consumer forums

 Respect the environment

CONSUMER IS THE KING..
FREE MARKET
CONDITIONS FOR A FREE MARKET TO EXIST
1

Freedom Of Choice
2
Free Competition
3
Consumer Rationality
 The Central
Consumer
Protection
Council

NEED FOR
CONSUMER The State CPC:
PROTECTION Consumer
Protection
COUNCIL Council To Promote
And Protect
The Rights Of
The
Consumers
The District
Consumer
Protection
Council
COMPOSITION OF THESE COUNCILS

THE CENTRAL THE DISTRICT

THE STATE CONSUMER
CONSUMER CONSUMER
PROTECTION COUNCIL
PROTECTION COUNCIL PROTECTION COUNCIL
• Members: • Members:
• Members: Chairman, other Chairman, other
Chairman, Vice members prescribed by members prescribed by
Chairman, other the State the State Government
members Government, Up to 10
members nominated by • Meetings : Not less
Central Government
• Meetings : at least than 2 meetings in a
once in a year year
• Meetings : At least 2
meetings in a year
CONSUMER DISPUTES REDRESSAL AGENCIES

At National Level

• National Commission
At State Level

• State Commission

At District Level

• District Forums
COMPOSITION

District Forum

• President : a person who is, or has been, or is qualified to be a District

Judge
• Two other members : persons of ability and integrity and have
knowledge (or experience) of
economics, law, commerce, accountancy, public affairs and
administration. One of the member shall be a woman

State Commission

• President: Judge of High Court

• Not less than 2 members and not more than the prescribed number (one
of them shall be a woman)

National Commission

• President: Judge of Supreme Court

• Members not less than four and not more than the prescribed numbers
(One of whom shall be a woman)
JURISDICTION

1. DISTRICT 2. STATE 3. NATIONAL

FORUM COMMISSION COMMISSION

Value of services and

Value of services and Value of services and
compensation claimed
compensation claimed compensation claimed
exceeds rupees 5 lakhs
does not exceed Rs 5 exceeds rupees 20
but does not exceed
Lakhs lakhs
rupees 20 lakhs

Complaint can be filed

by: Appeals against the Appeals against the
Consumer, Consumer orders of any District orders of any State
Association, Central or Forum within the state Commission
state government

Complaint can be filed Complaint can be filed

by: by:
Consumer, Consumer Consumer, Consumer
Association, Central or Association, Central or
state government state government
PROCEDURE ON RECEIPT OF A COMPLAINT

 It is the same for all the 3: District Forum, State

Commission & National Commission.

 But for the National Commission before the

procedure begins following should be kept in mind.
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
5. The relief which opposite party or
the complainant parties, as the case may
claims be, so far as they can be
ascertained;

4. Documents in
3. The facts relating
support of the
to the complaint and
allegations
when and where it
contained in the
arose
complaint
THE PROCEDURE
I] Referral of the complain copy to the opposite party;

II] If Opposite party denies or disputes the allegations or fails to take any action then
CDRA shall proceed to settle the dispute

5. On such cases
CDRA may adjourn
4. Any party fails to the hearing ( not more
produce his evidence or than 1 adjournment
to cause the attendance shall be given)
of witness – CDRA
3. Complainant fails to may not withstand
appear on such day, the
CDRA may dismiss the
complainant
complain, decide on
2. On the basis of merit or ex-parte
evidence brought by
the complainant and
opposite party fails
to take action

1. On the
basis of
evidence
brought by
complainant and
the opposite
party denies the
allegations
APPEAL
• Any person aggrieved by
an order made by the
District Forum may appeal
• Any person aggrieved by
against such order to the
State Commission within
a period of 30 days from
the date of the order.
District
Forum
State
Commission • Any person, aggrieved by
an order made by the
National Commission, may
appeal against such order to
an order made by the
the Supreme Court within a
State Commission may period of 30 days from the
appeal against such order date of the order
to the National
Commission within a
period of 30 days
National
Commission
TOTAL NUMBER OF CONSUMER COMPLAINTS
FILED / DISPOSED / PENDING
UNDER CONSUMER PROTECTION LAW

618
700

527
600
333
Number Of Cases (in ‘000)

500 307

260
400

300

200
90
84
100 72

0
10
Cases Filed
Cases Disposed
Cases Pending

National Commission State Commission District Forum

 CONSUMER GUIDANCE SOCIETY OF INDIA
(CGSI)
 1st consumer organization to demand special Consumer Court for
redressal of consumers' complaints

 Founded by nine women in 1966

 Monthly magazine - "KEEMAT" (Currently 32nd Year of publication)

 Produced consumer guides (electrical appliances, edible oils, pesticides, etc)

 Handles consumer complaint & offers legal guidance

 The CGSI aims at making consumers conscious of their rights and responsibilities
and strives to ensure it

 Example :Consumer education for rural consumers

MUMBAI GRAHAK PANCHAYAT
 Mumbai Grahak Panchayat (MGP), or Bombay Consumer Forum, started as an
agitation against the increase of consumer prices near festival season for fair and
free distribution of consumer goods

 Indian Societies Registration Act 1960 and Indian Public Trust Act 1950 in the
name of MGP

 Primary objectives - organizing the consumers for common causes, educating them and
protecting consumer interest through legal and other means

 More than 27,900 members and it has a presence in Greater Mumbai, Thane, Raigad
and Ratnagiri district

 Various activities conducted here – Monthly distribution of groceries, Panchayat

Peth, Road Shows and Cosumer Clubs

 Example: V/S
CONSUMER EDUCATION AND
RESEARCH CENTRE

 Protects consumer interest in India through various mediums

 It is an UNITED NATIONS approved NGO

 Mission - environmental protection, creating transparency and

accountability in the public, etc

 Example: CERC's intervention compels mattress manufacturer to

refund partial cost of defective mattress
HINDUSTAN UNILEVER CUSTOMER
OMBUDSMAN INITIATIVE

 In 2008, Hindustan Unilever had roped in an ombudsman.

 It was restricted to end consumers of HUL products.

 This was the first time an FMCG company had appointed an

independent and expert mediation procedure for the benefit of its
consumers.
COMPARATIVE STUDY OF INDIA VS THAILAND
CONSUMER PROTECTION ACT
THAILAND INDIA

1.The Act on Liability for Injury from

Unsafe Products
 Does not focus on the whether the o Focus is to prove that the product is
defendant is negligent. Plaintiffs just defective, not necessarily unsafe
have to Prove that the loss is caused
due to the product
2. The Act on Court Proceedings for
Consumer Cases
 Special masters are appointed for o Three-tier quasi-judicial system
speedy and fair proceedings

3.The Medical Malpractice Victim Fund Bill

 NO FAULT COMPENSATION o Defendant responsible for paying
SCHEME compensation only if proved guilty or
negligent
CASE STUDIES IN INDIA
 SC orders record Rs 5.96 Crore in a Medical Negligence
matter against Kolkata Hospital

 Nokia to pay Rs 67,000 for selling Defective Cell Phones

 Punjab Institute fined Rs 38 Lakhs for selling Diploma as

MBA
CASE STUDIES ABROAD

 Case #1: The Disappearing Car

 Case #2: The Pickup with Problems

 Case#3: The Chair Shortage

CASELETS
 Case #1: Jerome and Judith O'Callaghan sued American Airlines
for $100,000

 Case #2: Zeynep Inanli sued Starbucks for millions of dollars

 BIBLIOGRAPHY

 http://en.wikipedia.org/wiki/Consumer_protection#India
 http://www.ncdrc.nic.in/1_1.html
 http://ncdrc.nic.in/statistics.html
 http://www.gizmopod.com/gallery/2868/10-ridiculous-
lawsuits?utm_content=buffer4049a&utm_medium=social&utm_campai
gn=buffer&utm_sorce=twitter.com

 http://articles-junction.blogspot.in/2013/06/what-is-need-and-
importance-of-consumer.html?m=1

 http://www.ask.com/question/why-do-we-need-consumer-protection

 http://agmarknet.nic.in/amrscheme/armstandconsu.htm
 http://ncdrc.nic.in/1_1_2.html
PRESENTED BY E-MBA(A) GROUP NO.2:
 Abhishek Bhatt - 13003

 Ankish Jain - 13005

 Anubhav Lal - 13007

 Baroz Khan - 13012

 Bindi Shah - 13015

 Divya Gandhi - 13021

 Faraz Patel - 13024

THANK YOU