Consumer Protection Act 1986

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Indian Consumer Protection Act-1986

Introduction
The industrial revolution and the development in the international trade and
commerce has led to the vast expansion of business and trade, as a result of which
a variety of consumer goods have appeared in the market to cater to the needs of
the consumers and a host of services have been made available to the consumers
like insurance, transport, electricity, housing, entertainment, finance and
banking. A well organised sector of manufacturers and traders with better
knowledge of markets has come into existence, thereby affecting the relationship
between the traders and the consumers making the principle of consumer
sovereignty almost inapplicable. The advertisements of goods and services in
television, newspapers and magazines influence the demand for the same by the
consumers though there may be manufacturing defects or imperfections or short
comings in the quality, quantity and the purity of the goods or there may be
deficiency in the services rendered. In addition, the production of the same item
by many firms has led the consumers, who have little time to make a selection, to
think before they can purchase the best. For the welfare of the public, the glut of
adulterated and sub-standard articles in the market has to be checked. In spite of
various provisions providing protection to the consumer and providing for
stringent action against adulterated and sub-standard articles in the different
enactments like Code of Civil Procedure, 1908, the Indian Contract Act, 1872, the
Sale of Goods Act, 1930, the Indian Penal Code, 1860, the Standards of Weights
and Measures Act, 1976 and the Motor Vehicles Act, 1988, very little could be
achieved in the field of Consumer Protection. Though the Monopolies and
Restrictive Trade Practices Act, 1969 arid the Prevention of Food Adulteration
Act, 1954 have provided relief to the consumers yet it became necessary to protect
the consumers from the exploitation and to save them from adulterated and sub-
standard goods and services and to safe guard the interests of the consumers. In
order to provide for better protection of the interests of the consumer the
Consumer Protection Bill, 1986 was introduced in the Lok Sabha on
5th December, 1986 which is called as Consumer Protection Act of 1986
(COPRA).

Objectives & Importance of the Act


The Consumer Protection Act was implemented in order to provide better protection
to the rights of the consumers. Prior to the implementation of this Act, there was no
special act for protecting the consumers and the only remedy available to the
consumers was under the Law of Torts i.e filing a civil suit for damages against the
shopkeeper or the service provider. This act is based on the doctrine of Caveat
Emptor which means that it is the responsibility of the buyer to identify the
defects in the good.

ACT 68 OF 1986
The Consumer Protection Bill, 1986 was passed by both the Houses of
Parliament and it received the assent of the President on 24th December, 1986. It
came on the Statutes Book as THE CONSUMER PROTECTION ACT, 1986 (68
of 1986).

There are various objectives which are sought to be protected under the
Consumer Protection Act such as-

1. To promote and protect all the six rights of the consumers which were

(a) the right to be protected against marketing of goods which are


hazardous to life and property;
(b) the right to be informed about the quality, quantity, potency, purity,
standard and price of goods to protect the consumer gainst unfair
trade practices;
(c) the right to be assured, wherever possible, access to an authority of
goods at competitive prices;
(d) the right to be heard and to be assured that consumers interests
will receive due consideration at appropriate forums;
(e) the right to seek redressal against unfair trade practices or
unscrupulous exploitation of consumers; and
(f) right to consumer education.

2. To provide simple and speedy disposal to the cases by providing quasi-


judicial machinery for the redressal of consumer disputes.
3. The act also aims to provide inexpensive redressal to the issues of the
consumer.
4. A consumer dispute redressal forum called state commission has been set
up in order to settle the disputes of each and every consumer in all the
states of the country.
Who is a consumer?
According to Sec-2(1)(d) of the Act, a consumer is a person who purchases any
goods or services or hires or avails the services of some person for his own personal
use and not for manufacturing or resale of that good. For instance, a person
purchasing wheat flour for his own personal use is a consumer but a person
purchasing wheat flour for baking bread which he is going to sell in his bakery
shape is not a consumer.

Rights and Duties of a Consumer


The Consumer Protection Act has recognised six rights of a consumer
which are :

1. Right to Safety
2. Right to Information
3. Right to Choose
4. Right to be heard
5. Right to Redressal
6. Right to Consumer Education

Right to Safety
This right refers to as the right to be protected against the marketing of goods and
services which are hazardous to life and property of the consumers. This right has a
very wide scope of application, for instance, this right is available in the areas of
electrical appliances, healthcare, automobile, pharmaceuticals, housing, travel etc.
Nowadays, each and every field has an office for researchers who research and
experiment and launch new products and appliances accordingly. Most of these
products are not tested by the producers which prove to be harmful to the
consumer. Therefore, after the implementation of this act, there is a mandate for
each and every field to get all their products which are a danger to the life to be
carefully tested and validated before launching it to the market.

Right to Information
It refers to the right of a consumer to be informed of the quality, quantity, potency,
purity, standard and price of the goods and services being sold by the shopkeeper.
This right is given to the consumer in order to protect them from the various unfair
trade practices conducted by the seller in order to earn more profits. Therefore, it is
an obligation on the seller to provide the consumer with all the relevant information
of the product he wishes to purchase.

Right to Choose
It is defined in the act as the right to be assured, wherever possible, to have access
to a variety of goods and services at competitive prices. It is very common to find
one product being sold at different possible prices by different sellers. This reflects
the age of market competition which is found in almost all the countries. Therefore
it is the right of all the consumers to purchase any product at any price which
according to him is the best. A consumer cannot be forced to purchase a product of
some particular brand or quality.

Right to be heard
It is referred to as the right to be heard and to be assured that consumers’ interests
will receive due consideration at appropriate forums. This right was introduced for a
consumer in order to ensure that all the complaints and issues of the consumers are
heard duly under the appropriate authority. This is because of this right that almost
all the big selling companies have a separate department known as the customer
service to help the consumers in case of any dispute or any complaint regarding the
quality or quantity of the product.
Right to seek Redressal
If any consumer has been exploited by the seller or faced any unfair trade practices
he can seek redressal i.e. compensation or damages under this right. This right
ensures that all the issues of the consumers are dealt with and justice is done to
him. A proper redressal mechanism has been set up by the government of India
such as the consumer courts and forums at district and national level which is
discussed later in this article.

Right to Consumer Education


It is the right of each and every person who is a citizen of India to have knowledge
about all the laws and policies relating to the consumer. Therefore it is made sure
the material regarding the consumer-related laws is easily available all over India
but there is still a major part of the population who is not aware of his laws and
rights. This is the reason many awareness programmes have been organized by the
government of India such as ‘jago grahak Jago’ and the camps organized by various
lawyers in the remote areas of the country.

Duties of a consumer
Every consumer right comes with the opposite duty. Right of one consumer is the
duty of the others. Accordingly, there are various duties such as:-

 On purchasing of goods or hiring of any services, it is the duty of the


consumer to pay for the same.
 While purchasing something it is his duty to check weights, balances,
prices etc. and also to give a careful reading to the labels.
 It is the duty of the consumer to update himself about the various
consumer protection schemes.
 Duty to be careful while purchasing and not to fall in the trap of misleading
information and advertisements.
 It is the duty of the consumer to not purchase anything from the black
markets.
 It is the duty of the consumer to be aware of his rights and duties and also
spreading the awareness of the same among others.
 It is the consumers’ duty to file a complaint if the goods which he
purchased are defective.
 Each and every consumer should secure the bills of the goods purchased or
the services availed so that if in the future he finds the goods or services
to be defective he can easily file a complaint against the same and can
prove it.

Major definitions
 Complaint– According to Sec-2(1)(c) any allegation made by the
consumer regarding any restrictive or unfair trade practice which the
traders have adopted such as goods bought by a consumer are defective,
services hired or availed by him suffer some deficiency, trader has charged
an excessive price of the goods mentioned in the complaint, goods or
services which are hazardous to the life and property of the consumer has
been offered for sale to the public by the trader or the service provider.
 Consumer Dispute– according to Sec-2(1)(e) of the act it is a situation
when a person denies the allegations filed against him in a complaint.
 Person– according to Sec-2(1)(m) of the act the word person includes a
registered or unregistered firm, a Hindu undivided family, co-operative
society and any other association which is registered as a person under the
Societies Registration Act of 1860.
 Service– according to Sec-2(1)(o) service means any description or any
facility which is provided to the potential users and is not rendered free of
charge or under a contract of personal service.

Redressal Mechanism
The Consumer Protection Act proposes three-tier redressal mechanism: quasi-
judicial machinery at the National, state and district level. The jurisdiction of each
consumer redressal forum has been described under this act.
District Consumer Disputes Redressal Forum
Each and every district has a District Consumer Disputes Redressal Forum.
According to Sec-11 of this act, this forum has the jurisdiction to entertain
complaints and disputes only where the value of the goods or services and the
value of the compensation claimed does not exceed Rs 20 Lakhs. The District
Forum shall have the same powers as that of a civil court in the following
matters:

 In the summoning and enforcing of attendance of any defendant or witness


 In examining the witness on an oath
 In receiving the evidence on affidavit
 In any other matter which may be prescribed
 Demanding of the report of concerned analysis or test from the appropriate
laboratory or from any other authorized relevant source.
 In discovering and producing any document or other material objects
which are producible as evidence in the forum.

The District forum shall consist of a President i.e. the head of the commission who
is or has been or is qualified to be a district judge and two other members
possessing a bachelors degree from a recognized university and one of them shall
be a woman.

The members of a commission shall be the persons of ability, integrity and standing
and have adequate knowledge and experience regarding the field of a consumer.
Each and every member of the district forum shall either hold the office for a term
of 5 years or up to the age of 65 years, whichever is earlier.

State Consumer Disputes Redressal Commission


Each and every State has a State Commission. According to Sec-17 of the act, the
pecuniary jurisdiction of a State Commission for entertaining complaints or issues
where the value of goods or services and the value of the compensation claimed
exceeds Rs. 20 Lakhs but is less than Rs. 1 crore.
The State Commission shall consist of a President and the other two members. The
President shall be a person who is or has been qualified to be a Judge of High Court
and the other two members shall be possessing a bachelors degree from a
recognized university. Out of two members, one shall be a woman.

The members of a commission shall be the persons of ability, integrity and standing
and have adequate knowledge and experience regarding the field of a consumer.
Each and every member of the district forum shall either hold the office for a term
of 5 years or up to the age of 67 years, whichever is earlier.

National Consumer Disputes Redressal Commission


The National Commission was instituted in 1988. It is headed by a sitting or retired
Judge of the Supreme Court of India. The present President of the commission is
Justice R.K. Agrawal who is a former Judge of the Supreme Court of India.
According to Sec-21 of the act, the pecuniary jurisdiction of a National Commission
for entertaining complaints or issues where the value of goods or services and the
value of the compensation claimed is more than Rs. 1 crore.

The National Commission has been constituted with various powers such
as:

 It has the powers of administrative control over all the State Commissions.
It can call all the State Commissions or any one of them for periodical
returns regarding the institution, disposal and pendency of cases.
 It can adopt a uniform procedure in the hearing of the matters.
 It can provide a speedy grant of copies of documents to the parties.
 It also has a general power of overseeing the functioning of the State
Commissions and the District Forums.
 It has the power of providing prior service of the copies of the documents
produced by one party to the opposite parties.

In addition to the President of the commission, it shall consist of 4 other members,


out of which at least one shall be a woman. All of these members shall fulfil the
following conditions to be able to qualify as a member in the National
Commission:

1. Their age should not be less than 35 years of age.


2. They shall be possessing a bachelors degree from a recognized university.
3. They shall be a person of ability, integrity and standing and have adequate
knowledge and experience regarding the field of a consumer.

Every member of the commission shall hold office for a term of 5 years or up to the
age of 70 years whichever is earlier.

Who can file a complaint?


According to sec-2(1)(b) a complainant can be a person who is:

 A consumer, or
 Any voluntary consumer association registered under the Companies Act of
1956 or under any other law for the time being in force, or
 The Central Government or any State Government, who or which makes a
complaint, or
 One or more consumers, where there is more than one consumer they
shall have the same interest for filing a collective complaint, or
 In the case of death of a consumer, his legal heir or representative who or
which makes a complaint.

How to file a Complaint?


The very first step before filing a complaint the aggrieved party should do is to send
a notice to the service provider from whom the goods were purchased or the
service was availed informing him about the defects in the goods or the deficiency
in the service or unfair practice. This notice is sent to the trader or the aggrieved
party in order to see if that company or trader is willing to give the compensation or
offer any other remedy. If in case the trader or service provider is not willing to
provide with any remedy, the aggrieved party shall go ahead with filing a formal
complaint.

The next step is to file a formal complaint under the Consumer Protection Act of
1986. Here the aggrieved party does not need to hire a lawyer in order to file a
complaint. He can file the complaint on his own. The aggrieved party just need
to write down the following contents on a plain paper:

 Name, description and the address of the complainant and of the opposite
party or parties
 Facts relating to the complaint and time and venue where it arose
 All the possible documents in support of the allegations contained in the
complaint
 The relief or the remedy claimed by the complainant
 The complaint should consist of signatures of the complainant or his
authorized agent

The next step after the drafting of the complaint is to choose the appropriate
authority under whom the complaint is to be filed. The complainant shall choose the
authority according to pecuniary jurisdiction of his complaint i.e. the total value of
the goods or services and the compensation claimed by him. It is to be noted here
that the complainant can also file an online complaint
on www.consumerhelpline.gov.in

Furthermore, the complainant needs to pay the prescribed court fees according to
the pecuniary value of his case. Following are the fee details of the court fees:

For District forums


 Up to Rs 1 lakh: Rs 100
 Between Rs 1-5 lakh: Rs 200
 Between Rs 5-10 lakh: Rs 400
 Above Rs 10 lakh and up to Rs 20 lakh: Rs 500
For State Commissions
 Above Rs 20 lakh but less than Rs 50 lakh: Rs 2,000
 Above Rs 50 lakh and up to Rs 1 crore: Rs 4,000

For the National Commission


A standard amount of Rs 5,000/-

The Forum under which the complaint has been filed by the aggrieved party is
under a mandate to provide the resolution to the parties within a period of 30 days.
If it fails to adhere with the same the party can move to the next commission.

The limitation period for filing a Complaint or


Appeal to higher commission
 Filing of a complaint– the complainant can file a case against the trader
or the service provider only within two years from the date on which the
cause of action arose. The forum may entertain the case in case of delay
only if the complainant gives sufficient cause.
 Appeal to the State Commission– according to sec-15 of the act an
appeal can be filed to the State Commission by any person who is
aggrieved by an order passed by the District Forum within a period of
thirty days from the date of an order, in a form and manner prescribed
under the act. If an appeal is filed after the expiry of the period of
limitation the State Commission has the discretion to entertain that appeal
if the complainant shows sufficient cause for not filing an appeal within the
limitation period.
 Appeal to the National Commission– according to sec-19 of the act an
appeal can be filed to the National Commission by a person aggrieved by
the order passed by the State Commission within 30 days from the date of
receipt of order. The appeal to be accompanied by a copy of an affidavit.
 Appeal to the Supreme Court of India– according to sec-23 of the act
an appeal may be referred to the Supreme Court of India by the party
aggrieved by the order passed by the National Commission within a period
of 30 days from the date of order passed.
 Revision Petition to the National Commission– sec-21(b) of the act
vests the power in the National Consumer Disputes Redressal Commission
to call for the records and pass appropriate orders in any consumer dispute
which is either pending or has been decided by the State Commission. The
National Commission can exercise its revisional jurisdiction only if it
appears to the commission that the State Commission has acted illegally or
with irregularity or outside its jurisdiction. Such a Revision Petition can be
filed within a period of 90 days from the date of the order passed by the
aggrieved party.

Remedies available under the Act


The Consumer Protection Act provides consumers with various remedies. Following
are the remedies available under the act:

 Removal of Defects– if the consumer after conducting a proper test by


using the product finds the product to be defective then the authority can
pass an order of removing the defects in the product.
 Replacement of goods
 Refund of the price paid by the consumer while purchasing the product.
 Award of Consumption– a consumer can demand compensation from
the trader or service provider if because of his negligence the consumer
has suffered some physical or any other loss.
 Removal of Deficiency in Service– the authority can pass orders for
removal of the deficiency if there is any deficiency in delivery of the
service, for instance, if the consumer has applied for a loan and has
fulfilled all the formalities but the bank is making unnecessary delay in
sanctioning the loan, then the court can pass orders to sanction the loan.
 Discontinuance of Unfair/ Restrictive Trade Practice– if a complaint
is filed by the consumer against any unfair trade practice in the market,
the authority can order an immediate withdrawal of such practice and can
also pass an order for banning such trade practice.
 Stopping of sale of hazardous goods
 Withdrawal of hazardous goods from the market.
 Payment of the adequate cost

Consumer Protection Amendment Bill of 2018


The Consumer Protection Act of 1986 has been amended thrice but the act is still
not sufficient to deal with challenges such as online transactions, multi-level and
digital marketing. The Bill has proposed to make various changes in the ancient act
in order to provide better protection to the rights and interests of the consumer.
Following are the changes which the Bill proposes:

 Central Protection Councils (CPCs)– in the act of 1986 CPCs just has
the authority to promote and protect the rights of consumers but as
proposed in the Bill CPCs will be advisory bodies for promotion and
protection of consumer rights.
 The ambit of law– the 2018 Bill includes all goods and services, telecom
and housing construction and all modes of transactions for consideration
while excludes free and personal services.
 Unfair trade practice– this Bill proposes the addition of three more types
to the list of unfair trade practices as given in the act of 1986 i.e.

1. Failure to issue a bill or receipt


2. Refusal to accept a good returned within 30 days
3. Disclosure of personal information given in confidence, unless required by
law or in public interest.

 Product liability– earlier there was no provision of product liability in the


act of 1986 but now this Bill proposes that claim for product liability can be
made against the manufacturer, service provider and seller. Moreover,
compensation can be obtained by just proving one of the various
conditions mentioned in the Bill.
 The pecuniary jurisdiction of the Commissions– this Bill proposes to
change the pecuniary jurisdiction of the commissions to Rs 1 crore for
District Forum; between Rs 1 crore and 10 crores for State Commission;
and above Rs 10 crores for National Commission.
 Alternate dispute redressal mechanism– there was no such provision
in the original act but now the Bill proposes to attach Meditation cells to
the District, State and National Commissions.
 E-commerce– the Bill mentions and defines direct selling, e-commerce
and electronic service provider which were not there in the act of 1986.
Moreover. The central government may prescribe rules for preventing
unfair trade practices in e-commerce and direct selling.
 Penalties– the Bill proposes a change in the penalty i.e. imprisonment up
to three years or fine not less than Rs 25,000 which can be extended to Rs
one lakh or both.

MISCELLANEOUS

 28. Protection of action taken in good faith. — No suit, prosecution or other legal
proceedings shall lie against the members of the District Forum, the State Commission or the
National Commission or any officer or person acting under the direction of the District
Forum, the State Commission or the National Commission for executing any order made by it
or in respect of anything which is in good faith done or intended to be done by such member,
officer or person under this Act or under any rule or order made thereunder.
 28A. Service of notice, etc. - (1) All notices required by this Act to be served shall be
served in the manner hereinafter mentioned in sub-section (2).
 (2) The service of notices may be made by delivering or transmitting a copy thereof by
registered post acknowledgment due addressed to opposite party against whom complaint is
made or to the complainant by speed post or by such courier service as are approved by the
District Forum, the State Commission or the National Commission, as the case may be, or by
any other means of transmission of documents (including FAX message).
 (3) When an acknowledgment or any other receipt purporting to be signed
by the opposite party or his agent or by the complainant is received by the District Forum, the
State Commission or the National Commission, as the case may be, or postal article
containing the notice is received back by such District Forum, State Commission or the
National Commission, with an endorsement purporting to have been made by a postal
employee or by any person authorized by the courier service to the effect that the opposite
party or his agent or complainant had refused to take delivery of the postal article containing
the notice or had refused to accept the notice by any other means specified in sub- section (2)
when tendered or transmitted to him, the District Forum or the State Commission or the
National Commission, as the case may be, shall declare that the notice had been duly served
on the opposite party or to the complainant :
 Provided that where the notice was properly addressed, pre-paid and duly sent by registered
post acknowledgment due, a declaration referred to in this sub-section shall be made
notwithstanding the fact that the acknowledgment has been lost or mislaid, or for any other
reason, has not been received by the District Forum, the State Commission or the National
Commission, as the case may be, within thirty days from the date of issue of notice.
 (4) All notices required to be served on an opposite party or to complainant shall be deemed
to be sufficiently served, if addressed in the case of the opposite party to the place where
business or profession is carried and in case of complainant, the place where such person
actually and voluntarily resides.
 29. Power to remove difficulties.—(l) If any difficulty arises in giving effect to the
provisions of this Act, the (Central Government may, by order in the official Gazette, make
such provisions not inconsistent with the provisions of this Act as appear to it to be necessary
or expedient for removing the difficulty :
 Provided that no such order shall be made after the expiry of a period of two years from the
commencement of this Act
 (2) Every order made under this section shall, as soon as may be after it is made be laid
before each House of Parliament
 (3) If any difficulty arises in giving effect to the provisions of the Consumer Protection
(Amendment) Act, 2002, the Central Government may, by order, do anything not inconsistent
with such provisions for the purpose of removing the difficulty:
 Provided that no such order shall be made after the expiry of a period of two years from the
commencement of the Consumer Protection (Amendment) Act, 2002.
 (4) Every order made under sub-section (3) shall be laid before each House of Parliament.
 29A. Vacancies or defects in appointment not to invalidate orders.—No act or
proceeding of the District Forum, the State Commission or the National Commission shall be
invalid by reason only of the existence of any vacancy amongst its member or any defect in
the constitution thereof.
 30. Power to make rules. - (1) The Central Government may, by notification, make rules
for carrying out the provisions contained in clause (a) of sub-section (1) of section 2, clause
(b) of sub-section (2) of section 4, sub-section (2) of section 5, sub-section (2) of section 12,
clause (vi) of sub-section (4) of section 13, clause (hb) of sub-section (1) of section 14,
section 19, clause (b) of sub-section (1) and sub-section (2) of section 20, section 22 and
section 23 of this Act.
 (2) The State Government may, by notification, make rules for carrying out the provisions
contained in clause (b) of sub-section (2) and sub-section (4) of section 7, clause (b) of sub-
section (2) and sub-section (4) of section 8A, clause (b) of sub-section (1) and sub-section (3)
of section 10, clause (c) of sub-section (1) of section 13 clause (hb) of sub-section (1) and
sub-section (3) of section 14, section 15 and clause (b) of sub-section (1) and sub-section (2)
of section 16 of this Act.
 30A. Power of the National Commission to make regulations - (1) The National
Commission may, with the previous approval of the Central Government, by notification,
make regulations not inconsistent with this Act to provide for all matters for which provision
is necessary or expedient for the purpose of giving effect to the provisions of this Act.
 (2) In particular and without prejudice to the generality of the foregoing power, such
regulations may make provisions for the cost of adjournment of any proceeding before the
District Forum, the State Commission or the National Commission, as the case may be, which
a party may be ordered to pay.
 31. Rules and regulations to be laid before each House of Parliament - (1) Every rule
and every regulation made under this Act shall be laid, as soon as may be after it is made,
before each House of Parliament, while it is in session, for a total period of thirty days which
may be comprised in one session or in two or more successive sessions, and if, before the
expiry of the session immediately following the session or the successive sessions aforesaid,
both Houses agree in making any modification in the rule or regulation or both Houses agree
that the rule or regulation should not be made, the rule or regulation shall thereafter have
effect only in such modified form or be of no effect, as the case may be; so, however, that any
such modification or annulment shall be without prejudice to the validity of anything
previously done under that rule or regulation.
 (2) Every rule made by a State Government under this Act shall be laid as soon as may be
after it is made, before the State Legislature.

Conclusion
The Consumer Protection Act has proved to be a helping hand to the consumers and
protected them from being exploited in the hands of huge companies and famous
traders. The traders and the firms are still working on how to make huge profits and
one of the ways is by exploiting the consumer. Corresponding to this the
Legislature and the Judiciary are making amendments in the act from time to time
but the consumer himself needs to be careful and aware of the people in the
market.

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