The Consumer Protection Law- Birds Eye View

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Author : nirali
Published on : February 11, 2017

nirali's Profile and details
My name is Nirali Deepak Parekh. I am a student of Shri Vile Parle Kelvani Mandal's Pravin Gandhi College Of Law,( 5 years course) at Vile Parle, Mumbai. I am currently in my third year of BLS;LLB.

The Consumer Protection Law- Bird’s Eye View

Need for Consumer Protection

In the business industry, the consumers hold a very vital position. The producers in the market engage themselves in the production of various kinds of goods depending on the choice, liking, interests, preferability and tastes of the consumers in order to facilitate smooth running and consistency of sale in the due course of business . The consumer is somewhere seated in the mean around which all the different business transactions keep revolving. But inspite of they occupying an indispensable and a crucial place they tend to fall prey to the immoral conduct of various traders , dishonest salesmen , and unfair practices which various wholesalers tend to indulge into , in order to deceive people with an intention to become monetarily superior in the market. It is pertinent to take into account that there is lack of knowledge on the part of the consumers, and also when it comes to the sellers they are more organized and in harmony in relation to the consumers in the society today. The sellers are also comparatively more informed and updated about the various kinds of laws as well as rights in this aspect than the consumers. Due to the absence of unity and inadequacy of information and knowledge with respect to their rights , the consumers become victims of the illegal and unfair trade practices adopted by various sellers. So, in order to provide protection and grant privileges to the consumers, the Consumer Protection Act was enacted in the year 1986 . The act was passed with the motive and the objective to restrain the consumers from being victimized by the unscrupulous traders , malpractices adopted by numerous marketeers and also aimed at creating awareness among the consumers in relation to their rights as well as duties, which in turn would also serve as a helping hand in enhancing the oneness among everyone in the society . The main ideology that led to the establishment of the Consumer Protection Laws was also to assure the consumers that they being the ‘ consumers’ would not at any cost be deprived of their rights within the purview of the act.

During the olden days, the application of the Latin maxim ‘Caveat Emptor’ (let the buyer beware), made its appearance in the English Law for the very first time in the year 1523, and to a much larger extent had restrained the consumers from availing their rights and had placed them at the mercy of the seller. This maxim basically implies that the buyer ( purchaser) when he goes to purchase any good or avails of any service , it is the seller who actually has more information .However eventually several exceptions to this maxim came into existence , which had the effect of diminishing the impact of this rule on the unfortunate buyer. Therefore, during this period a tremendous need was felt to secure the consumer , provide him with the necessary rights and also protect him from being exploited at the hands of the seller’s and the service providers manipulation skills. It is a known and an undeniable fact that media plays a major role in influencing the minds and perceptions of the masses. So the different aspects of media be it the television , press, cinema etc from every nook and corner made attempts and bombarded the consumers with different advertisements which were on a larger scale considered to be quite misleading and the consumers also were lured by them because they happened to be attractive and appealing . There also came situations when the consumer was exposed to a surplus of adulterated goods, deficient services etc also in the name of which he was fleeced. It is very evident that the interests of the buyers and those of the sellers can never coincide , they have always been poles apart. The vendor is always making an attempt to sell the goods at the highest possible price and the buyer acts in a defensive manner and tries his level best to pay a meagre sum. The consumer in the process of purchasing ,always carries this fear deep down his heart that he might just fall into the trap of the seller and get exploited, and even after exploitation most of them are left without a remedy. It was observed that the consumers do not really have much time , the ability, the necessary resources, nor the skills to actually make a proper choice when exposed to different kinds of products. The only available alternative to him is to may be rely on an advertisement which he might have come across , or take a friend’s advice while purchasing etc. Paying heed majorly to the Indian scenario, it is noticeable that the consumers here prefer being silent spectators and continue to suffer rather than knocking the doors of justice in order to seek remedy. In India, the masses have always been quite nervous and hestitant to move to the courts of law in order to seek redress. They are of the opinion that they might just end up wasting a lot of time as well as incur lot of expenses in the process of litigation.

Even before the passing of the Consumer Protection Act there were provisions which exist even today in order to grant protection to the consumers. They include the Indian Penal Code, the Sale of Goods Act, the Indian Contract Act etc but the consumers were not satiated completely by the remedies provided to them under the act.

After a spate of such events , in the later phase an urgent need was felt to enact some sort of a legislation for the benefit of the consumers . Thus to bridge this gap between the seller and the consumer and also to make the consumer recognize his rights, the Consumer Protection Act came into force in the year 1986 . The act aimed at making the consumers armed with proper knowledge and also providing them with an instrument to come forward and fight for their rights against the unjust and the illegal trade practices .

Aims and objectives of the act
1.Protection against malpractices
One of the main objective’s of the Consumer Protection Act is to safeguard the consumers from different kinds of malpractices adopted by sellers, businessmen etc which includes supply of defective and deficient goods and services, low quality products, overcharging in the name of high grade and quality etc.

2. Providing knowledge to the consumer
The goal of the Consumer Protection Act also includes making the consumer stand in a position from where he is able to recognize his rights. The act aims to ensure that whenever the consumer goes to purchase anything, he is well aware and updated of his rights, and privileges granted to him within the ambit of the act.

3. Representation of consumers
The act also aims to ensure that the consumers are capable enough of representing themselves in front of the various government authorities in case they have any grievances relating to the quality, quantity, standard, potency, purity etc of the goods.

4. Cease and desist from unfair practice
The act throws light upon the unethical and the immoral trade practices adopted by the vendors. It pressurizes them to follow a certain code of conduct while dealing with different customers in various transactions . It also emphasizes on the concept of ‘work ethics’, and is of the view that it is important to bear in mind this concept in order to keep the market functioning at its peak.

5. Creating association
The Consumer Protection Movement also aims at establishment of the consumer redressal agencies at the district, state and the national level.

6. Prevention of anti- social and illegal activities
The Act is also established with the objective to curb down the adoption of anti- social activities which includes black marketing, supply of adulterated goods, hoarding etc.

7. To awaken the government bodies
The act also aims at persuading the government authorities for passing different laws and bringing them into force for the protection and welfare of the consumers in the society.
The main object and purpose of the the act is to render simple, inexpensive and speedy justice through a three tier system of quasi – judicial machinery at the district, state as well as the national level.

Who is a consumer?

Under the Consumer Protection Act, consumer means any person who:
(i) buys any goods for a consideration which has been paid or promised orpartly paid and partly promised, or under any 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
such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or

(ii) hires or avails of] any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who [hires or avails of] the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person [ but does not include a person who avails of such services for any commercial purpose]

In Mahanagar Telephone Nigam Ltd .V. Vinod Karkare, a person who was actually using the telephone with the subscribers permission was held to be a consumer. He could therefore claim compensation from the telephone company for a deficiency in service- although he himself was not a subscriber of that telephone company.

As seen above, services hired or availed of for a commercial purpose and goods purchased for resale or for a commercial purpose lie outside the ambit of the act.

In Sterocraft v. Monotype India Ltd ,when a person imported a photo typesetting machine for use in his printing press, it was held that the machine was brought for a commercial purpose, and therefore the buyer was not a consumer.

But in Sanjay Pant v. Chetana Machinery & Paper Mart, when a similar machine was purchased for self employment , and the purchaser only wished to earn his livelihood from the machine, it was held that he was a consumer , as the machine was not purchased for any commercial purpose.

In Indian Medical Association .v . V. P . Shanta & Others, the question which arose was whether the medical profession ( doctors, hospital, nursing homes,etc) fall within the purview of the Consumer Protection Act. Thus the issues to be decided in this landmark case by the Supreme Court Bench consisting of Justices Kuldeep Singh , S. C . Agrawal and B. L Hansaria , was whether a medical practitioner , a hospital or a nursing home can be regarded as rendering ‘service’ as defined under Section 2 (1) (o) of the Consumer Protection Act 1986?

The Supreme Court in this case has held that a patient who gets free treatment in a government hospital that is, where the services are rendered free of charge would not constitute to be a ‘ service’ and therefore such patients cannot be called as a ‘‘consumer” and it makes no difference if he pays a nominal amount as registration charges etc. However, a patient in a private hospital who pays for his treatment is a consumer.

Consumer Dispute Redressal Agencies

The Consumer Protection Act provides for a three tier system in order to resolve consumer disputes. These redressal agencies have been mainly set up in order to give relief to the consumers . These agencies include the District Forum, then at the State level there is the State Commission and at the National Level there is the National Commission which is in Delhi.
The pecuniary jurisdiction of these courts are as follows:
1. District Forum: All claims under Rs 20 lakhs.
2. State Commission: All claims between 20 lakhs and Rs 1 crore.
3. National Commission: All claims above Rs 1 crore.

When a person is aggrieved by an order passed by the District Forum, he can file an appeal in the State Commission. Orders passed by the State Commission are appealable before the National Commission. Appeals against the orders passed by the National Commission are to be filed before the Supreme Court. All appeals are to be filed within a period of 30 days from the date of the order.

We can conclude that the Consumer Protection Act has come into existence for assuring the welfare of the consumers in the society. Earlier , before the passing of the act even though there were certain provisions for the protection of the consumers ,but they were unsatisfactory and most of the times it resulted in the accused go scot free. Initially before the act came into operation, it was disappointing to learn that the sellers and the various kinds of businessmen accompanied with ulterior motive and malafide intentions were majorly engrossed in exploiting the consumers by offering them defective goods, deficient services which are hazardous to the life and property etc, and even after filing a complaint most of them were left without seeking any justice . It is essential to understand the fact that in order to increase the sales of a company or be it of a small private enterprise the company or the seller should take the initiative, put in hard work and efforts to establish a warm and cordial relationship with the consumer and also build trust and rapport with him . The company must try to understand what the consumer needs and should provide him with the products that would deliver the benefits assured by them during the sale in the market. The consumer having grievances relating to the goods purchased or services availed by him was left with no means and support to seek justice. Now, after the enforcement of the Act , the scenario seems to be a little at ease, for the consumershaving been provided with a source which is of great help to them in combating for their rights and seeking remedy in case if they face any hardship.We can deduce that the act has come into force with the object to create awareness among the consumers in the society and to ensure that they are well informed of their rights and at no cost are deprived of the privileges granted to them within the ambit of the act. But it is also important to take into consideration that just because the act has been established for the well being and in the interest of the consumers , the law at the same time expects the consumer to act immediately in case if he finds himself in any jeopardy or in a situation where he feels there has been an infringement of a legal right within the act. If a consumer having a laidback attitude, suddenly pops up from a deep slumber to file a complaint and to seek redress then he will not be entertained by law, for having violated the provisions of the ‘ Limitation Act’. The Consumer Protection Act aims to deter the traders, businessmen etc from engaging themselves into any kind of illegal and unethical trade practices . It aims at resolving the disputes faced by the consumers in the market today. The objective of the act is also to take a stand for the consumers and discover a solution for any kind of hindrances experienced by them during the process of the business transactions taking place in the global market. The act focuses on fostering a fiduciary relationship between the buyer and the seller which in turn would also strengthen the growth and development in the society.

“ Marketing is increasingly impersonal . Consumer choice is influenced by mass advertising utilizing highly developed arts of persuasion.’’- John F Kennedy

2.Section 2 (d) – Consumer Protection Act
3.(1991) CPJ 655
4.(1991) 1 CPJ 111
5.(1993) CLJ 493
6. (1995) 6 SCC 651