Wednesday, February 27, 2008

Consumer Protection Act, 1986

Introduction & Definitions

A consumer is a user of goods and services. Any person paying for goods and services which he uses is entitled to expect that the goods and services are of a nature and quality promised to him by the seller.

The earlier principle of "Caveat Emptor" or "let the buyer beware" which was prevalent has given way to the principle of "Consumer is King". The origins of this principle lie in the fact that in today's mass production economy where there is little contact between the producer and consumer, often sellers make exaggerated claims and advertisements which they do not intend to fulfill. This leaves the consumer in a difficult position with very few avenues for redressal. The onset on intense competition also made producers aware of the benefits of customer satisfaction and hence by and large, the principle of " consumer is king" is now accepted.

The need to recognise and enforce the rights of consumers is being understood and several laws have been made for this purpose. In India, we have the Indian Contract Act, the Sale of Goods Act, the Dangerous Drugs Act, the Agricultural Produce (Grading and Marketing) Act, the Indian Standards Institution (Certification Marks) Act, the Prevention of Food Adulteration Act, the Standards of Weights and Measures Act, the Trade and Merchandise Marks Act, etc which to some extent protect consumer interests. However, these laws required the consumer to initiate action by way of a civil suit which involved lengthy legal process proving to be too expensive and time consuming for lay consumers. Therefore, the need for a more simpler and quicker access to redressal to consumer grievances was felt and accordingly, it lead to the legislation of the Consumer Protection Act, 1986.

Objects of the Consumer Protection Act, 1986

Objects

The preamble to the Act states that the Act is legislated to provide for better protection of the interests of consumers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consumer's disputes and for matters connected therewith.

The basic rights of consumers as per the Consumer Protection Act (CPA) are

1. the right to be protected against marketing of goods and services which are hazardous to life and property

2. the right to be informed about the quality, quantity, potency, purity, standard and price of goods, or services so as to protect the consumer against unfair trade practices

3. the right to be assured, wherever possible, access to variety of goods and services at competitive prices

4. the right to be heard and be assured that consumers' interests will receive due consideration at appropriate forums

5. the right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers

6. the right to consumer education

The CPA extends to the whole of India except the State of Jammu and Kashmir and applies to all goods and services unless otherwise notified by the Central Government.

Meaning of Complaint Under Consumer Protection.

Complaint means :-

1. A consumer; or

2. Any voluntary consumer association registered under the Companies Act, 1956 or under any other law for the time being in force; or

3. The Central Government or any State Government, who or which makes a complaint; or

4. One or more consumers where there are numerous consumers having the same interest

Complaint means any allegation in writing made by a complainant that :-

1. an unfair trade practice or a restricted trade practice has been adopted by any trader

2. the goods bought by him or agreed to be bought by him suffer from one more defects

3. the services hired or availed of or agreed to be hired or availed of by him suffer from deficiency in any respect

4. the trader has charged for the goods mentioned in the complaint a price excess of the price fixed by or under any law for the time being in force or displayed on the goods or any package containing such goods.

5. goods which will be hazardous to life and safety when used, are being offered for sale to the public in contravention of the provisions of any law for the time being in force, requiring traders to display information in regard to the contents, manner and effect of use of such goods ;with a view to obtaining any relief provided by law under the CPA.

Meaning of Consumer Under Consumer Protection.

Consumer means any person who :-

1. buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment (eg hire purchase or installment sales) and includes any other user of such goods when such use is made with the approval of the buyer, but does not include a person who obtains such goods for resale or for any commercial purpose ; or

2. 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 when such services are availed of with the approval of the first mentioned person

For the purposes of this defination "commercial purpose" does not include use by a consumer of goods bought and used by him exclusively for the purpose of earning his

Meaning of Goods Under Consumer Protection.

Goods

Goods means goods as defined in the Sale of Goods Act, 1930. Under that act, goods means every kind of movable property other than actionable claims and money and includes stocks and shares, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale.

Meaning of Service Under Consumer Protection.

Service

Service is defined to mean service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purverying of news or other information but does not include the rendering of any service free of charge or under a contract of personal service.

Meaning of Consumer Dispute Under Consumer Protection.

Consumer Dispute

Consumer dispute means dispute where the person against whom a complaint has been made, denies or disputes the allegation contained in the complaint.