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CONSUMER PROTECTION ACT—1986

Consumer is at the core of business world in the present day economy. Quantity and
quality of goods are produced as per the needs of the consumer. Advancement of any
business unit depends on the satisfaction of the consumer. That product will be in great
demand which gives maximum satisfaction to the consumer and so will be produced on
large scale. As a result, the concerned production unit will develop and earn large profit.
Despite the Fact that Importance of the consumer is widely recognized, he is deprived of
his rights and privilege and is subjected to diverse kinds of exploitation. For instance
exploitation in the form of short weight and measure poor quality of the product,
adulteration, supply of fake goods, boarding and black marketing of the goods, delivery
of goods not on schedule. Not only that, even doubtful and false advertisements are
indulged into by the producers to attract consumers.
With a view to protecting the consumers from such exploitation and making them aware
of their rights, a method of consumer protection has been launched. Need for protection
arid satisfaction of the consumer is now being widely recognized across the world. India
has also adopted the concept of consumer protection more seriously and vigoursly.

Meaning of Consumer Protection:

Consumer protection means the protection of the consumers from their exploitation by
the unfair trade practices of the producers/sellers. In fact, providing proper protection of
the fundamental rights and Interests of the consumers, freeing them from exploitation,
creating consumer awareness, consumer providing the right to clean business
environment to the consumers by means of Legal amendments Is all that protection
means,

Consumer Protection Act In India:

In India, Central and State Governments have passed various legislative enactments
regarding Consumer Protection. Among them, main Acts are:

• Drug and Cosmetics Act 1940,

• Industries Development and Regulation Act 1951
• Indian Standards Institution (Certification Marks) Act 1952
• Prevention of Food Adulteration Act 1954
• Essential Commodities (Supply) Act 1955
• The Trade and Merchandise Marks Act, 1958
• Monopolies and Restrictive Trade Practices Act 1969
• Packaged Commodities Regulation Order 1975
• Standards of Weights and Measures Act 1976
• Prevention of Black Marketing and Maintenance of Supplies of Essential
Commodities Act 1980
• Standards of Weights and Measures (Enforcement) Act. 1985.
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In spite of above Acts Interests of the consumers were not being properly safeguarded.
There are many reasons for it, but main among them are two,

First, consumer in general had no knowledge about the authority to whom complaints
under these acts were to be addressed.

Second, to seek remedy under these various acts consumer had to take legal action
Involving lot of time and money.

Need was therefore felt to enact such a legislative measure as provide quick and less
expensive remedy to the aggrieved consumer. Consequently, to protect properly the
interest of the consumers and to settle quickly their disputes, in December 1986
Consumer Protection Act was passed in India. It was enforced with effect from April 15,
1987. Last amendment In the Act was made in. 2002.

SCOPE AND EXTENT OF THE ACT:

1. Except Jammu and Kashmir state, this Act extends to whole of India.
2. Provisions of this Act are In addition to the provisions made previously in the context
of the consumers.
3. This Act shall apply to all goods and services that come under the scope of this Act.

Main Elements/Features of Consumer Protection Act, 1986:

Consumer Protection Act is the most progressive Act of Social well are and is referred to
as Magna Carta of consumer protection. It is a land mark event In the history of Acts In
India.
Main features of the Act are as under

• It applies to all kinds of goods and services.

• Provisions of this Act are in addition to the provisions of any other Act in force In
the country. Thus, this Act does not limit or reduce the scope of any other Act

• Under this Act, there Is a provision for the Centre and State Governments to set
up Consumer Protection Councils composing of both official and non-official
members. The objectives of the council are:
- to promote the rights and Interests of the consumers,
- to educate and protect them.
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• This Act provides for the following rights to the consumer:

o Right to safety,
o Right to be heard,
o Right to consumer education,
o Right to seek redressal
o Right to Choose
o Right to be Informed

• This Act is based on the principle of compensation wherein fair compensation to

the aggrieved party is provided for. To redress the grievance, there Is provision
for three-tier judicial machinery
o District level
o State level and
o National Level

• This Act provides affective protection to the consumer from different types of
exploitations, such as defective goods, adulteration, under-weight, excessive
price, unsatisfactory or deficient services and unfair trade practices.
• This Act redresses in a simple, cheap and dynamic manner the grievance of the
consumer in limited time.
• All suppliers of goods and services belonging to private, public and co-operative
sectors come under the purview of this Act.

Right to Consumer:

In a free market economy, consumer is sovereign. He has the right to buy or not to buy a
product offered for sale, to expect the product to be safe; to expect the product sale, to be
what it is claimed to be; to be adequately informed about the most salient aspect of the
product. He has a right to receive proper and efficient service and satisfaction. Under
section 6 of Consumer Protection Act, consumer has following rights:

(I) Right to Safety: Consumer has the right to be protected against marketing of such
goods and services as are hazardous to health, life and property. There are several fake,
adulterated, inferior, defective, ineffective and dangerous goods available in market.
They are injurious to body and health. Consumer therefore, has the right to safety from
all such goods as well as are likely to cause harm to his body and health, besides causing
loss of money.

(II) Right to Choose: Under this right, consumer can choose any from among the variety
of goods and services available in the market. One finds in the market goods of different
brand, quality, shape, colour, size, design and price produced by different manufacturers.
Under this right, the consumer must be assured access to variety of goods and services at
competitive prices as far as possible. Misleading or false advertisement, wrong
information or in any other way, If any person (manufacturer, seller) influences his
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preference, in an unfair or unnecessary manner, it will be treated as intervention in his

right to choose.

(III) Right to be Informed: Consumer has the right to get all necessary information on
the basis of which he may decide to buy the good or service. He has therefore the right to
be Informed about the quality, quantity, purity, potency, standard, price of goods, etc.

(IV) Right to be heard: Consumer has the right to present before the appropriate forum or
authorities all those matters which effect his interests. This right Includes the right to
make protest and file complaints. This right implies that matters of interest to the
consumer will receive due consideration at appropriate forums, so that he is encouraged
to express his problems, complaints and unjust treatment meted out to him.

(V) Right to seek redressal: Consumer has the right to get his claims and complaints
settled against the manufacturers and sellers. This right provides the consumer freedom
from unfair trade practice or unscrupulous exploitation by the trader. Besides, it helps
him secure compensation.

(VI) Right to Consumer Education: Under this right, consumer is entitled to get
Information or educated about those things which are necessary for him. Such an
education creates awareness about his rights and he comes to know when to approach for
the redressal of his grievance and exploitation. This helps a consumer protect himself
against fraudulent, deceptive and misleading advertisement and poor or negligent
services.

Machinery for Redressal of Consumer Grievances:

To provide simple, speedy and inexpensive redressal of consumer grievances, the act envisages
three- tier quasi-judicial machinery at the national, state and district levels.

* National Consumer Disputes Redressal Commission - known as 'National Commission'.

* Consumer Disputes Redressal Commissions known as 'State Commission”.
* Consumer Disputes Redressal Forums- known as 'District Forum”.

(I) The District Consumer Protection Council :

The State Government shall establish for every district, by notification a council to be
known as the District Consumer Protection Council with effect from such date as it may
specify in such notification.

Composition of the district forum:

Each District Forum shall consist of -

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• A person who is, or who has been or is qualified to be, a District Judge, who shall
be its President;
• There will be 2 other members who shall be persons of ability, integrity and
standing and have adequate knowledge or experience or have shown capacity In
dealing with problems rebating to economics, law, commerce, accounting,
industry, public affairs or administration, one of whom shall be a women.

• Every appointment shall be made by the State Government on the

recommendation of Selection Committee consisting of the following namely:

o The President of the State Commission- Chairman,

o Secretary, Law Department of the State- Member,
o Secretary, incharge, of the Department dealing with Consumer affairs in
the State- Member.

Terms and age:

Provided that a member shall be eligible for re-appointment for another term of 5 years or
up to the age of 65 years, whichever is earlier.

Jurisdiction of the district forum:

(1) Subject to other provisions of this Act, the District Forum shall have jurisdiction to
entertain complaints where the value of the goods or services and the compensation if
any, claimed does not exceed rupees twenty lakhs.

(2) A complaint shall be instituted in a District Forum within the local limits of whose
jurisdiction, -

(a) The opposite party or each of the opposite parties, where there are more than
one, at the time of the institution of the complaint, actually and voluntarily resides
or carries on business or has a branch office, or personally works for gain; or

(b) Any of the opposite parties where there are more then one, at the time of the
institution of the complaint, actually and voluntarily resides, or carries on
business or has a branch office, or personally works for gain, provided that in
such case either the permission of the District Forum is given, or the opposite
parties who do not reside, or carry on business or have a branch office, or
personally works for gain, as the case may be, acquiesce in such institution; or

(c) The cause of action, wholly or in part arises.

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(II) The State Commission:

Regarding State Commission following provision have been made In Consumer

Protection Act 1986.

Establishment: In every state, the state government, by issuing a notification can establish
consumer Grievance Redressal Commission to be called ‘State Commission’.

Composition: Each State Commission shall consist of:

• A person (member) who is or has been a judge of a High Court, appointed by the
State Government. who shall be its President. But his appointment shall be made
only after consultation with the Chief Justice of the High Court.
• There will be 2 other members who shall be persons of ability, integrity and
standing and have adequate knowledge or experience or have shown capacity In
dealing with problems rebating to economics, law, commerce, accounting,
industry, public affairs or administration, one of whom shall be a women.
• Every appointment shall be made by the State Government on the
recommendation of the selection committee. The Selection committee shall be
composed of:
o President of the State Commission — Chairman
o Secretary of the Law Department of the State — Member
o Secretary incharge of the Department dealing with Consumer Affairs in
the State — Member

Terms and Age:

Every member of the State Commission shall hold office for a term 5 years, or up to the
age of 67 years, whichever is earlier, and shall not be eligible for re-appointment.

Jurisdiction of State Commission:

Subject to the other provision of this Act., the State Commission Shall have Jurisdiction:

(a) to entertain:
(i) complaints where the value of the goods or services and compensation, if any
claimed exceeds rupees 20lakhs but does not exceed rupees one crore.
(ii) appeals against the orders of any District Forum within the Stale; and

(b) to call for the records and pass appropriate and pass appropriate orders In any
consumer dispute which is pending before or has been decided by any District Forum
within the State, where It appears to the State Government that such District Forum has
exercised a jurisdiction not vested In it by law or has failed to exercise a Jurisdiction so
vested or has acted in exercise on its jurisdiction illegally or with material irregularity.
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III. The National Commission:

Following are the provisions of the Consumer Protection Act in respect of the National
Commission:

Establishment:
By issuing a notification Central Government can set up a National Commission This
Commission has been established at New Delhi.

Composition:
The National Commission shall compose of:

• A person (member) who is or has been a judge of the Supreme Court, shall be
appointed by the Central Government. He shall be its President. Provided that no
appointment under this clause shall be made except after consultation with the
Chief justice of India.
• There shall be 4 other members including one woman. They shall be persons of
ability integrity, experience of, or have shown capacity in dealing with problems
relating to economics, law, commerce, accountancy, industry, public affairs or
Administration.

Every appointment shall be made by the Central Government on the recommendation of

a Selection Committee consisting of the following namely:

• A person who is a judge of the Supreme Court, to be nominated by the chief

justice shall be its Chairman.

• The secretary Department of Legal Affairs In the government of India shall be Hs

member.
• Secretary of the Department dealing with consumer affairs in the government of
India shall be its other members.

Term of Members:

Every member of the National Commission shall hold office for a term of 5 years or up
to the age of 70 years, whichever is earlier.
.
Jurisdiction of the National Commission:

Subject to the other provisions of this Act, the National Commission shall have
Jurisdiction as under
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• to entertain complaints where the value of the goods or services and

compensation, if any, claimed exceeds rupees 1crore.
• to entertain appeals against the orders of any State Commission;
• to call for the records and pass appropriate orders In any consumer dispute which
is pending before or has been decided by any state commission where it appears
to the National Commission that such State Commission has exercised a
jurisdiction not vested in it by Law, or has failed to exercise a jurisdiction so
vested, or has acted in the exercise of its jurisdiction illegally or with material
irregularity.