Consumer Protection Act INTRODUCTION

Consumer rights are an integral part of our lives like the consumerist way of life. We have all made use of them at some point in our daily lives. Market resources and influences are growing by the day and so is the awareness of ones consumer rights. These rights are well defined and there are agencies like the Government, consumer courts and voluntary organizations that work towards safeguarding. While we like to know about our rights and make full use of them, consumer responsibility is an area which is still not demarcated and it is hard to spell out that all the responsibility is that a consumer is supposed to shoulder. Consumer Protection Act, 1986 is an important Act in the history of the consumer movement in the country. The Act was made to provide for the better protection and promotion of consumer rights through the establishment of consumer councils and quasi-judicial machinery. It is mile stone in the history of socio-economic legislation and directed towards public welfare and public benefits. The CPA was passed by the Lok Sabha on 5th December 1986 and Rajya Sabha on 10th December, 1986 and assented to by the president in the Gazette of India. Extra Part II: Section 1 dated 26.12.1986.and at PP 1-12 called, the CPA 1986 (Act No.66 of 1986) and the preamble states that, An Act provide for better protection of the interest of the consumers and for that purpose to make provisions for the establishment of consumer councils and other authorities for the settlement of consumers dispute and for matters connected therewith. Under the Act, consumer disputes redressal agencies have been set up through out the country with the District Forum at the District level, State Commission at the State level and National Commission at national level to provide simple, inexpensive and speedy justice to the consumer with complaints against defective goods, deficient services and unfair and restrictive trade practices1. The Law relating to consumer protection in India is at recent origin and is developing slowly, day by day, with the pronouncement of orders passed by the commissions constituted under the Act all over India and the National

P. K. Majumdar: Law of Consumer Protection in India , 5Th edition 2003.

Commission2. However the presence of some protective Laws for the benefits of consumer in the ancient culture cannot be denied3. BACKGROUND In the early years when welfare legislatures like the consumer protection Act did not exist, the maxim Caveat emptor (let the buyer beware) governed the market deals. We find the seeds of consumer protection during the Mughal times4 and especially during the time of Khiljis. It is said that Sultan Ala-ud-Din Khilji (1296 A.D. to 1316 A.D.) had introduced strict price control measures based on production costs5. He had also established separate shopping centers in Delhi for (1) grain, (2) cloth, sugar, dried fruits, herbs, butter, and oil, (3) horses, slaves, and cattle, and (4) miscellaneous commodities. The supply of grain was ensured by collecting tax in kind in the production areas and keeping it in the royal storehouses. Hoardings of grain were forbidden. Elsewhere the growers were ordered to sell their grains for cash in their fields at fixed prices and were not allowed to take any grain home for private sale. The market controller, the state intelligence officer, and the Sultans secret agents, each submitted independent reports on these shopping centers to the Sultan. Even a minor violation of the rules was not tolerated6. The shopping center for cloth, known as the sara-i-adl, was established near one of the royal palaces on the inner side of the Bada-un-Gate. All goods, including foreign imports, were first taken there and their price fixed. Every merchant was registered with the commerce ministry and had to sign a bond guaranteeing a regular supply to the goods in which they traded. The Hindu Multani merchants were advanced money by the treasury to import rare commodities for the sara-i-adl, some price were subsidized. Costly fabrics and luxury goods could be sold only to those who have obtained permits from the Government. The prices of cattle were also fixed and unscrupulous merchants were deprived of their trading rights7. The shopping center for general commodities was under the direct control of the commerce ministry. Ala-ud-Dins Minister of commerce was also the Superintendent of weights and Measure and the Controller of the Commercial transactions. He was assisted by Superintendent for each commodity. Prices and weight and measure were chequed by sending the children employed in the royal pigeon-house to buy petty articles 8.The prices

2 3

I(1994) CPJ 509 DB, 1995(1) CPJ 1. O. P. Tiwari, CPA (1) 1996. 4 J.N.Sarkar (1952): Mughal Administration, Calcutta. 5 S.A.A.Rizvi (1987); The wonder that was India, vol.2, London Sidgwick & Jackson, p.38. 6 ibid., p.39. 7 id., 8 id.,

fixed for the Delhi market were also applied in the provincial capitals and towns. During the British regime (1765-1947)9, also known as the Colonial Era, Governments economic polices in India were concerned more with protecting and promoting the British interests than with advancing the welfare of the native population. The administrations primary peroccupation was with maintaining law and order, tax collection and defence10. Accordingly much of the legalisation enacted during the British regime was primarily aimed at serving the colonial rulers intend of the natives. There were, however, some pieces of legislation which protected the overall public interest through not necessarily the consumer interest.11 Prominent among these were: the Indian Penal code, 1860, the sale of Goods act, 1930, the dangerous drugs act, 1930 and the drugs and cosmetics act, 1940. In a sense, the sale of good act, and the principles of the law of torts were more for the protection of the trader than the consumer12. THE POST-INDENDENCE SCENARIO The struggle for Indias independence was over by 15 th August, 1947. However, the attainment of independence was not an end in itself. Due to the increased emphasis on industrialization during the second five year plan, there was tremendous growth and establishment of heavy industries. As a result there was a considerable amount of migration of rural population to the urban areas in search of employment, as India is characterized by a vast amount of disguised unemployment in the agricultural sector. Growing urbanization due to heavy industrialization resulted in proliferation of human needs-of basic necessaries and also of luxuries. Due to the shortage of certain necessaries and even their non-availability at reasonable rates with growing menace of adulteration, it was found necessary to empower the Government to control their production, quality, supply, and distribution. Therefore the decade of 1950s, right from the very beginning, saw the enactment of a number of laws to safeguard the interests of the consumers from various angles. The enactment of the Banking Companies Act,1949 (later called The Banking Regulation Act) to amend and consolidate the Law related to banking matters as well as the Industries(Development and Regulation)Act,1951 to implement the Industrial Policy Resolution of 1948 were among the earliest stapes taken by the National Government in India in the direction of consumer protection.

J.N.Pandey (1992): Constitutional Law of India, Allahabad: Central Law Agency, pp.1-16. Dharam Kumar and Meghnath Desai (eds) (1982): The Cambridge Economic Histroy of India,vol.2, Hyderbad: Orient Longman, p.947. 11 D.N.Saraf (1990): Law of Consumer Protection of India, Bombay: N.M. Tripathi, p.13. 12 id.,
10

With the continuous industrialization and urbanization, environmental problems also came more to the forefront, but seldom got any worth while attention of Indian planners and policy makers till the fateful incident of Bhopal in 1984. Thus the Bhopal catastrophe, perhaps for the first time, focused considerable attention on the industrialization and hazards, business environmental pollution, Government responsibility

accountability. The Union Carbide tragedy also highlighted the potential risks to the lives of the citizens or consumers from the operations transnational corporations in foreign lands. Now with the opening up of the Global Market and economics and progressive removal of international trade barriers, two phenomenons have been witnessed with. First, there is influx of foreign brands and franchises. Second, within India, there is increasing competition among manufacturers which has benefited consumers in the form of improvement in quality of goods and resources. Thus in turn has witnessed more and more legislations aimed at regulating the manufacturing and trading activities and providing protection to consumers at large. Now the maxim caveat emptor has been replaced by, let the seller beware. As a result of this change in scenario business has now come to be substantially regulated by Government and Authorities in favour of consumers. Inspite of various provisions providing protection to the consumer and providing for stringent action against adulterated and substandard articles in the different enactments like Criminal Procedure Code, 1908, Indian Contract Act, 1972, Sales of Goods Act, 1930, Indian Penal Code 1860, Standard of Weights and Measures Act, 1976 and Motor Vehicle Act,1988, very little could be achieved in the area of consumer protection. Though Monopolies and Restrictive Trade Practices Act, 1969 and prevention of Food Adulteration Act, 1954 have provided relief to consumers, yet it becomes necessary to protect consumers from exploitation and to save them from adulteration and substandard goods and services and to safe guard their interests. In order to provide for better protection of the interest of the consumers the Consumer Protection Bill, 1986 was introduced in the Lok Sabha on December 5th 1986. The CPA 1986 was enacted to provide for better protection of the interest of consumer and for the purpose to make provisions for establishment of Consumers Councils and other authorities for settlement of consumers dispute and for matters connected therewith. The CPA is only one of the several Laws framed to protect consumers from unfair and undesirable practices of business community such law

became necessary due to growing frustration of consumers with substandard quality of goods, unsatisfactory services and unfair business trade practices. The Act is a social welfare legislation enacted to provide for the better protection of the interest of the consumers and different redressal forums have been established under the said Act for settlement of consumers disputes. The legislature hereby enacted such legislation for speedy solution of disputes of the consumers for the benefit of people at large. The people to allow those forums to function as far as possible without avoidable interdiction by the High Court. The consumer legislation is a beneficiary piece of legislation and the legislature in order to help the consumers has not prescribed any court fee to be affixed on the complaint. But it is expected from the complainant that they should come before the Redressal Agencies with clean hands and that the relief claimed by them are not inflated. On a strict reading of the provisions of the Act as a whole it would be seen that in enacting the statute the interaction of the Parliament was to provide protection and relief to four categories of consumers: (i) (ii) Persons who have suffered loss or damage as a result of any Persons who have purchased goods for which the trader has unfair trade practice adopted by any trader. charged a price in 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. (iii) (iv) Persons who have purchased goods for consideration which Persons who have hired any services for consideration when are found suffer from one or more defects. the services provided are found to suffer from deficiency in any respect. OBJECTIVE The provision of the Act in the light of its preamble reads as: An Act to provide better protection of the interest of consumers for the settlement of consumer dispute and for matters connected therewith. The word protection furnishes the key to the mind of the makers of the act13. Its provision has to be interpreted in favour of the consumer, in such a manner as to provide maximum relief to him. The primary duty of the court, while constructing provisions of the Act is to adopt a constructive approach. It should not do violence to the provisions and should also not be contrary to attempted objective of the Act14. This Act has not been frame to provide a loophole and excuses to well

13 14

Lucknow Development Authority v. M.K. Gupta, (1994) 1 SCJ 103 at 110 Id at 110

organized traders, producers15 and big business houses and manufactures on technical grounds. RELIEF UNDER THE CONSUMER PROTECTION ACT Reliefs provided under the Act, 1986 are as follows: (I) SPECIFIC RELIEFS The Act allows consumers to file complaints on five specific grounds. The Act does not allow complaints to frame their reliefs as they do not wish nor does it leave it to the Consumer Disputes Redressal Agencies (CDRAs) to work out remedies according to their discretion. The reliefs possible are indicated in Article 14 of the Act. One can find below the reliefs obtainable in the case of each of the items of complaint listed in Article 2(1) (c). DEFECTS IN GOODS There are several remedies in respect of this: -Removal of the defect pointed out by the laboratory (a); -Removal of defect in respect of goods not sent to laboratory analysis (e); -Replacement of goods (d); -Return of price (c). In respect of fungible goods the removal of defect will not be of any use to the complainant. But however the order will be operative in future as regards the same goods and would serve the interest of all consumers. Clause (a) being restricted to defects pointed out by the laboratories, Clause (e) provides the relief in respect of other goods not sent to the laboratory. It is true that the word goods is not found in that Clause. The clause should normally read as to remove the defects in the goods or deficiencies in the services in question. But it can be understood only as such, since one can gather from the definition of the word defect in Clause 2(1)(f) that it relates only to goods. Similarly deficiency is only in respect of service [Clause 2(1) (g). The complainant should, therefore, take care not to use the word defect for deficiency or vice-versa. DEFICIENCY IN SERVICE The reliefs are: -Return of charges paid (c); -Removal of the deficiency (e). Removal of deficiency in not always possible once service has been rendered. Even if possible, it is no usually desired by the consumer, who had a bad experience, to resort to the same person for service. OVER-PRICING OF ARTICLES

15

id., at 110

Return of the price against return of the article or reimbursement of the excess price. UNFAIR TRADE PRACTICE AND RESTRICTIVE TRADE PRACTICE The reliefs are: -To discontinue them or not to repeat them (f); Unfair trade practice and restrictive trade practice are defined in the Act with great precision. These words should be used only in cases contemplated in the definitions of those words, not in case of other grounds of complaint like defect in goods or overt-pricing, because the reliefs in such case are different.

HAZARDOUS GOODS The reliefs are: -Not to offer the hazardous goods for sale (g); -To withdraw the hazardous goods from being offered for sale (h); It is thus seen that for each ground of complaint there is one or more reliefs available which can be asked for alternatively or cumulatively. It is for the complainant to decide and to frame properly the reliefs with indication of the respective clauses. (II) GENERAL RELIEF OF COMPENSATION Compensation may be asked in all cases, Negligence in case of defects in goods, though not frequent, may however happen. Therefore, compensation will be a welcome relief to the consumer in addition to the other which he possesses. It is in respect of service that compensation will play a big role. In this connection it is to be stated that negligence is very close to deficiency which arises in consumer will get only return of charges, whereas if there is negligence, he will get compensation in addition. Compensation has to be specifically asked for and the acts of negligence pointed out. Once negligence is proved, the amount of compensation has to be determined. As per the Act it is for loss or injury suffered. The complaint has, therefore, to give details of the loss and estimate it in terms to be established. The correctness of the estimate has also to be established. The complainant can start by an affidavit. If the demand appears reasonable the same have to be adduced, failing which the CDRA concerned will determine itself the amount. Lastly how and to what extent loss or injury is attributable to

negligence is also to be shown and proved except in cases of res ipsa loquitur, where the fact is eloquent by itself. Whereas the extent of other reliefs is determined by the Act itself this one is left to the appreciation of the CDRAs. Regarding the assessment of compensation by CDRAs there are two methods: Global assessment to the best of the judgment of the adjudicating body which consists at least of there persons or computation of damages with the help lf some yardsticks. The second course appears to be more accurate. But the yardsticks are not easy to determine properly and may lead some times to grace errors. The preference of the CDRAs is now for global assessment.

MEANING AND SCOPE OF CONSUMER AND C.P.A.

As the preamble of CPA 1986 reflect; this socio-economic Law was enacted to provide for the better protection of the interest of consumers and for that purpose the CPA 1986 seeks to provide speedy and simple redressal to consumer dispute. In Charan Singh v. Healing Touch Hospital16 the Honble Supreme Court has made important observations on the object of the act. S.2(1)d of the act defined consumer as Consumer means any person who(i) Buys any goods for a consideration which has been paid or promised or partly paid and party 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 person, but does not include with the approval of self person, but does not include a person who obtains such goods for resale or for any commercial purpose or (ii) {Hires for avails of} any services for a consideration which has been paid promised or partly paid or partly promised or under any system of differed payment and includes any beneficiary of such services other than the person. [hires or avails of ] the services for consideration paid or promised or partly paid or partly promised, under any system of differed payment, when such services are availed or with the approval the first mentioned person. The word consumer as has been defined in the Act means any person who buys any goods for consideration, but does not include a person who obtain such goods for resale or for any commercial
16

AIR 2000 SC 3138.

purpose. Thus a person who purchases goods for any commercial purpose, does not fall within the definition of word consumer. Going by plain dictionary meaning of the words used in the definition of consumer it is clear that this Act intends to restrict the benefits to ordinary consumers purchasing goods either for their own consumption or even for use in small ventures which they have embarked upon in order to make a living and to deny the benefit of the Act to persons purchasing engaged on a large scale. Scope The definition has two parts. The first part in clause (1) deals with buyer and user of goods. The 2nd part covers the hirers and beneficiary of services. CONSUMER RIGHTS Consumers in the advanced countries, obviously, are much more conscious of their rights than in countries like India. In 1962, President John F. Kennedy, and in 1965, President Johnson emphasized the consumer rights and gave an impetus to consumerism in the U.S.A and other countries. Important consumer rights include: 1. Right against exploitation by unfair trade practices. 2. Right to protection of health and safety from the goods and services the consumers buy or are offered free. 3. Right to be informed of the quality and performance standards, ingredients of the product, operational requirements, freshness or the product, possible adverse side effects and other relevant facts concerning the product or service. 4. Right to be heard if there is any grievance or suggestions. 5. Right to get genuine grievances redressed. 6. Right to choose the best from a variety of offers. 7. Right to physical environment that will protect and enhance the quality of life. Exploitation of Consumers Consumers are, however, by and large, practically denied most of these rights. They are exploited by a large number of restrictive and unfair trade practices. A situation has developed in science is extensively applied to marketing to ruthlessly, exploit the consumers by stimulating the weak points and soft corners of their mind. Misleading, false or deceptive goods either for the purpose of resale or for the purpose of being used in profit making activity

advertisements are quite common.

Many a time the advertisements

deliberately give only half truths so as to give a different impression than is the actual fact. Thus, advertisements may, be misleading because things that should be said have not been said, or, because advertisements are composed or purposefully presented in such a way as to mislead. CONSUMER PROTECTION For effective consumer protection, a practical response on the part of three parties, for example, the business, the government and the consumers, is essential. Firstly, the business, comprising the producers and all the elements of the distribution channels, has to pay due regard to consumer rights. The producer has an inescapable responsibility to ensure efficiency in production and the quality of output. He should also resist the temptation to charge exorbitant prices in a sellers market. Many a time, the imperfections on the supply side, like hoarding and black marketing, mercilessly gouge the consumer. Hence, a socially responsible producer should see to it that whatever is produced reaches the ultimate consumer in time and at reasonable prices. Secondly, the Government has to come to the rescue of the helpless consumer to prevent him from being mislead, duped, cheated and exploited. It should also take special care of the vulnerable sections. Governments should establish or maintain legal and/or administrative measures to enable or, as appropriate, relevant organizations to obtain redress through formal or informal procedures that are expeditious, fair, inexpensive and accessible. Such procedures should take particular account of the needs of low-income consumers. Thirdly, consumers should accept consumerism as a means of asserting and enjoying their rights. Consumerism should succeed in making the business and the government more responsive to the rights of the consumers. Consumerism is a social force to (i) make the business more honest, efficient, responsive and responsible, and (ii) pressurize the government to adopt the necessary measures to protect consumer interests by guaranteeing their legitimate rights. CONSUMER PROTECTION AND CONSUMERISM IN INDIA Plight of the Indian Consumer An examination of the important problems facing the Indian consumer would make clear the need for more effective government intervention and consumer movement to safeguard consumer rights. The following factors make the plight of the Indian consumer miserable.

1. Short supply of many goods and services, especially of essential items, is a very serious problem afflicting the Indian consumer. The demand-supply imbalance has produced all the associated corruption, evils of profiteering, hoarding and and black-marketing, towards nepotism, irresponsiveness arrogance

consumers. Although the situation has improved as a result of the increase in competition due to liberalization, it is still far from satisfactory. 2. The Indian consumer is also the victim of lack of effective or workable competition. Competition among sellers, even though imperfect, may be regarded as effective or workable if it offers buyers real alternatives sufficient to enable them, by shifting their purchases form one seller to another, substantially to influence quality, service, and price. Effective competition depends also upon the general availability of essential information; buyers cannot influence the behaviour of sellers unless alternatives are known. It requires the presence in the market of several sellers, each of them possessing the capacity to survive and grow, and the preservation of conditions which keep alive the threat of potential competition among sellers is thus to be found in the availability of buyers of genuine alternatives in policy among their sources of supply17. 3. Many products with which consumers in advanced countries are quite familiar are still new to a very large segment of the Indian consumers. The unfamiliarity of the consumers with product features makes the sale of substandard, inferior or even defective products easier in India than in advanced countries. 4. Due to low literacy levels and unsatisfactory information flows, the Indian consumers, by and large, are not conscious of all their rights. This encourages irresponsible and unscrupulous business attitudes and tactics. 5. It has been said that the legal process in India is comparatively time-consuming and cumbersome. This discourages the consumers from seeking the Redressal of their grievance by means of the judicial process. 6. Consumerism in India is not well organized and developed. 7. Though the public sector had not been developed and expanded to serve the public interest by providing effective competition to the private sector, increasing production, improving distribution, etc., it failed to produce benefits that were commensurate with the investment.
17

Joel Dean. Managerial Economics, New Delhi: Prentice-Hall

8. Though there are a number of laws to safeguard the interests of consumers, they are not effectively implemented and enforced to achieve the objectives. The above factors are effective State intervention and consumerism to ensure the rights of consumers. Government Measures In India, the Government has taken a number of measures to protect consumer interests. The various Government measures may be classified into (i) statutory regulation of private business, and (ii) development of the public sector. Statutory Regulation: Government of India has armed itself with a number of statutory weapons to control the production, supply, distribution, price and quality of a large number of goods and services. It is empowered to regulate the terms and conditions of sale, the nature of trade and commerce, etc. There is a feeling that, unlike in the West, the Government in India has a large number of controls on industry and is, therefore, in a position to respond more swiftly and effectively than western Governments. I some ways our bureaucracy has perfected the art of assuming the guardianship of all interests of the consumers and the vulnerable sections. Growth of Public Sector: There had been a significant growth and expansion of the public sector in India. One of the most important objectives of the public sector was the enhancement of consumer welfare by increasing production, improving efficiency in production, improving efficiency in production and supply, making available goods and services at fair prices, curbing private monopolies and reducing market imperfections, improving the distribution system, and so on. The public sector, in fact, is expected to implement the societal marketing concept. There is, however, a general feeling that the public sector in India has still a long way to go to realize these objectives. It has established monopolies or near-monopolies in public utilities, whose performance is far from satisfactory.

LEGAL PROVISION CONSUMER PROTECTION ACT, 1986

PREAMBLE An Act 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 consumers' disputes and for matters connected therewith India as follows: 1. SHORT TITLE, EXTENT, COMMENCEMENT AND APPLICATION (1) This Act may be called the Consumer Protection Act, 1986. (2) It extends to the whole of India except the State of Jammu and Kashmir18. (3) It shall come into force on such date 1 as the Central Government may, by notification appoint and different dates may be appointed for
18

Be it enacted by Parliament in the Thirty-seventh Year of the Republic of

The provisions of Chapters I, II and IV of this Act have come into force in the whole of India

except the State of Jammu and Kashmir on 15-4-1987: vide Notification No. S.O. 390 (E), dated 15th April, 1987, published in the Gazette of India, 1987, Extra. Pt. II, Sec. (ii). The Provisions of Chapter III of this Act have come into force in the whole of India except the State of Jammu and Kashmir on 1-7-1987: vide Notification, No. S.O. 568 (E), dated 10th June, 1987, published in the Gazette of India, 1987, Extra. Pt. II, Sec. 3 (ii).

different

States

and

for

different

provisions

of

this

Act.

(4) Save as otherwise expressly provided by the Central Government by notification, this Act shall apply to all goods and services. 2. Definitions. (1) In this Act, unless the context otherwise requires,19

[(a) "Appropriate laboratory" means a laboratory or organization;

(i) Recognized by the Central Government may be prescribed by the Central Government in this behalf; or

(ii) Recognized by a State Government, subject to such guidelines as (iii) Any such laboratory or organization established by or under any law for the time being in force, which is maintained, financed or aided by the Central Government or a State Government for carrying out analysis or test of any goods with a view to determining whether such goods suffer from any defect;]

(b) "Complainant" means (i) A consumer; or (ii) Any voluntary consumer association registered under the companies Act, 1956 (1 of 1956), or under any other law for the time being in force; or (iii) The Central Government or any State Government, who or which makes a complaint;
20

[(iv) One or more consumers where there are numerous consumers [(v) in case of death of a consumer, his legal heir or

having the same interest;]

21

representative.]who or which makes a complaint; (c) "Complaint'' means any allegation in writing made by a complainant that[(i) An unfair trade practice or a restrictive trade practice has been adopted by 5[any trader or service provider;]] (ii)22[The goods bought by him or agreed to be bought by him] suffer from one or more defects; (iii)
23

[Service hired or availed of or agreed to be hired or availed of by

him] suffer from deficiency in any respect;

19

Substituted by Act 50 of 1993, sec. 2 for clause (a) w.e.f. 18-6-1993. Ins. by Act 62 of 2002, sec.2 (w.e.f. 15-3-2003).

20

Ins. by Act 62 of 2002, sec.2 (w.e.f. 15-3-2003). Subs. by Act 50 of 1993, sec. 2, for "the goods mentioned in the complaint" (w.e.f. 18-61993). 23 Subs. by Act 50 of 1993, sec. 2, for "the services mentioned in the complaint" (w.e.f. 18-61993).
21 22

(iv) [a trader or the service provider, as the case may be, has charged for the goods or for the service mentioned in the complaint, a price in excess of the price in excess of the price(a) fixed by or under any law for the time being in force; (b) displayed on the goods or any package containing such goods; (c) displayed on the price list exhibited by him by or under any law for the time being in force; (d) agreed between the parties;
24

[(v) goods which will be hazardous to life and safety when used are

being offered for sale to the public: (A) in contravention of any standards relating to safety of such goods as required to be complied with, by or under any law for the time being in force; (B) if the trader could have known with due diligence that the goods so offered are unsafe to the public;]
25

[(vi) service which are hazardous or likely to be hazardous to life and

safety of the public when used, are being offered by the service provider which such person could have known with due diligence to be injurious to life and safety.] (d) "Consumer" means any person who, (i)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 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)26[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 then the person who [hires or avails of] the services for consideration paid or promised, or partly paid and partly promised, or
Ins. by Act 50 of 1993, sec.2 (w.r.e.f. 18-6-1993) and subs. by Act 62 of 2002, sec. for subclause "(v) 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," (w.e.f. 15-3-2003).
24

Sub-clause (vi) along with sub-clause (iv) and (v) subs. For the earlier clauses (iv) and (v) by Act 62 of 2002, sec. 2 (w.e.f. 15-3-2003). 11. Subs. By Act 50 of 1993, sec.2, for "hires" (w.r.e.f. 18-6-1993).
25 26

Subs. By Act 50 of 1993, sec.2, for "hires" (w.r.e.f. 18-6-1993).

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];
27

[Explanation. For the purposes of this sub-clause "commercial

purpose" does not include use by a consumer of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood, by means of self-employment;] (e) "Consumer dispute'' means a dispute where the person against whom a complaint has been made, denies or disputes the allegations contained in the complaint; (f) "Defect" means any fault, imperfection or short coming in the quality, quantity, potency, purity or standard which is required to be maintained by or under any law for the time being in force or
28

[under any contract

express or implied or] as is claimed by the trader in any manner whatsoever in relation to any goods; (g) "Deficiency" means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service 9. Establishment of Consumer Disputes Redressal Agencies. There shall be established for the purpose of this Act, the following agencies, namely: (a) A Consumer Disputes Redressal Forum to be known as the "District Forum" establishment by the State Government each district of the State by notification:
30 29

[* * *] in

[Provided that the State Government may if it deems fit, establish

more then one District Forum in a district.] (b) A Consumer Disputes Redressal Commission to be known as the "State Commission" established by the State Government 1[***] in the State by notification; and (c) A National Consumer Disputes redressal Commission established by the Central Government by notification.

27

Added by Act 62 of 2002, sec.2, (w.e.f. 15-3-1993).

Subs. by Act 62 of 2002, sec.2, for "Explanation.- for the purposes of sub-clause (i), " commercial purpose" does not include use by a consumer of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self-employment:" (w.e.f. 15-3-2003). 29 The words 'with prior approval of the Central Government" Omitted by Act 50 of 1993. Sec. 7 (w. r. e. f. 18th June 1993).
28

30

Ins. by Act 50 of 1993. Sec. 7 (w. r. e. f. 18th June 1993).

10. Composition of the district forum

31

[(1) Each District Forum shall consist of -

(a) A person who is, or who has been or is qualified to be , a District Judge, who shall be its President;
32

[(b) two other members, one of whom shall be a woman, who

shall have the following qualifications, namely: (i) be not less than thirty-five years of age, (ii) posses a bachelor's degree from a recognized university, (iii) be persons of ability, integrity and standing, and have adequate knowledge and experience of at least ten years in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration: Provided that a person shall be disqualified for appointment as member if he(a) has been convicted and sentenced to imprisonment for an offence which, in the opinion of the State Government, involves moral turpitude; or (b) is an undischarged insolvent; or (c) is of unsound mind and stands so declared by a competent court; or (d) has been removed or dismissed from the service of the Govt. or a body corporate owned or controlled by the Government; or (e) has, in the opinion of the State Government, such financial or other interest as is likely to affect prejudicially the discharge by him of his functions as a member; or (f) has such other disqualifications as may be prescribed by the State Government.]
33

[(1-A) Every appointment under sub-section (1) shall be made

by the State Government on the recommendation of selection Committee consisting of the following namely: (i) The President of the State Commission- Chairman, (ii) Secretary, Law Department of the State- Member, (iii) Secretary, incharge, of the Department dealing with Consumer affairs in the State- Member.]

31

Subs. by Act No. 50 of 1993 sec. 8, for sub-section (1) (w. r. e. f. 18-6-1993)

Subs. by Act 62 of 2002, sec. 6, for clause "(b) two other members, who shall be persons of ability, integrity and standing, and have adequate knowledge or experience of , or have shown capacity in dealing with, problems relating to economics, law, commerce, accountancy, industry, public affairs or administration, one of whom shall be a woman" (w. e. f. 15-3-2002).
32 33

Inserted by Act 50 of 1993, sec.8 (w.e.f. 18-6-1993).

34

[Provided that where the President of the State Commission is, by

reason of absence or otherwise, unable to act as Chairman of the Selection Committee, the State Government may refer the matter to the Chief Justice of the High Court for nominating a sitting Judge of that High Court to act as Chairman.]
35

[(2) Every member of the District Forum shall hold office for a term of

five years or up to the age of sixty-five years/ whichever is earlier: Provided that a member shall be eligible for re-appointment for another term of five years or up to the age of sixty-five years, whichever is earlier, subject to the condition that he fulfils the qualifications and other conditions for appointment mentioned in clause (b) of sub-section (1) and such reappointment is also made on the basis of the recommendation of the Selection Committee : Provided Further that a member may resign his office in writing under his hand addressed to the State Government and on such resignation being accepted, his office shall become vacant and may be filled by appointment of a person possessing any of the qualifications mentioned in sub-section (1) in relation to the category of the member who is required to be appointed under the provisions of sub-section (1A) in place of the person who has resigned : Provided Also that a person appointed as the President or as a member, before the commencement of the Consumer Protection (Amendment) Act, 2002, shall continue to hold such office as President or member, as the case may be, till the completion of his term. ] (3) The salary or honorarium and other allowances payable to, and the other terms and conditions of service of the members of the
34

35

Inserted by Act 62 of 2002, sec.6 (w. e. f. 15-3-2003). Subs. by Act 62 of 2002, sec.6, for sub-section "(2) Every member of the District Forum

shall hold office for a term of five years or up to the age of 65 years, whichever is earlier, and shall not be eligble for re-appointment:

Provided that a member may resign his office in writing under his hand addressed to the State Government and on such resignation being accepted, his office shall become vacant and may be filled by the appointment of a person possessing any of the qualification mentioned in sub-section (1) in relation to the category of the member who has resigned." (w. e. f. 15-3-2003).

District Forum shall be such as may be prescribed by the State Government: [Provided that the appointment of a member on whole-time basis shall be made by the State Government on the recommendation of the President of the State Commission taking into consideration such factors as may be prescribed including the work load of the District Forum.] 11. 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 exceed rupees twenty lakhs]
36

[does not .

(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 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
39 37

[carries on

business or has a branch office, or] personally works for gain;

[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 institution;
39

[carry on business or have a branch office], or or

personally works for gain, as the case may be, acquiesce in such

(c) The cause of action, wholly or in part arises. 12. Manner in which complaint shall be made .

(1) A complaint in relation to any goods sold or delivered or agreed to

Substituted by Act 50 of 1993, sec.9 for "is less than rupees one lakh"(w. e. f. 18-6-1993) and again subs. by Act 62 of 2002, sec. 7, for "does not exceed rupees five lakhs" (w. e. f. 15-3-2003)
36

37

Subs. by Act 50 of 1993, sec.9 for "carries on business or" (w. r. e. f. 18-6-1993).

be sold or delivered or any service provided or agreed to be provided, may be filed with a District Forum, by(a) the consumer to whom such goods are sold or delivered or agreed to be sold or delivered or such service provided or agreed to be provided; (b) any recognized consumer association whether the consumer to whom the goods sold or delivered or agreed to be sold or delivered or service provided or agreed to be provided is a member of such association (c) one or more or consumers, where not; there are or numerous

consumers having the same interest, with the permission of the District Forum, on behalf of, or for the benefit of, all consumers so interested; or (d) the Central Government or the State Government, as the case may be, either in its individual capacity or as a representative of interests of the consumers in general. (2) Every complaint filed under sub-section (1) shall be accompanied with such amount of fee and payable in such manner as may be prescribed. (3) On receipt of a complaint made under sub-section (1), the District Forum may, by order, allow the complaint to be proceeded with or rejected: Provided that a complaint shall not be rejected under this subsection unless an opportunity of being heard has been given to the complainant: Provided Further that the admissibility of the complaint shall ordinarily be decided within twenty-one days from the date on which the complaint was received . (4) Where a complaint is allowed to be proceeded with under sub-section (3) the District Forum may proceed with the complaint in the manner provided under this Act :

Provided that where a complaint has been admitted by the District Forum, it shall not be transferred to any other court or tribunal or any authority set up by or under any other law for the time being in force. Explanation: For the purposes of this section, "recognized consumer association" means any voluntary consumer association registered under the Companies Act, 1956 (1 of 1956), or any other law for the time being in force.]

38

13. PROCEDURE ON RECEIPT OF COMPLAINT

39

(1) The District Forum shall, on receipt of a complaint, if it -

relates to any goods,

(a) refer a copy of the complaint to the opposite party mentioned in the complaint directing him to give his version of the case within a period of thirty days or such extended period not exceeding fifteen ; (b) where the opposite party on receipt of a complaint referred to him under clause (a) denies or disputes the allegations contained in the complaint, or omits or fails to take any action to represent his case within the time given by the District Forum, the District Forum shall proceed to settle the consumer dispute in the manner specified in clauses (c) to (g) ; (c) where the complaint alleges a defect in the goods which cannot be determined without proper analysis or test of the goods, the District Forum shall obtain a sample of the goods from the complainant, seal it and authenticate it in the manner prescribed and refer the sample so sealed to the appropriate laboratory along with a direction that such laboratory make an analysis or test whichever may be necessary, with a view to finding out whether such goods suffer from any defect alleged in the complaint or from any other defect and to report its findings thereon to the District Forum within a period of forty-five days of the receipt of the reference or within such extended ; (d) before any sample of the goods is referred to any appropriate laboratory under clause (c), the District Forum may require the complainant to deposit to the credit of the Forum such fees as may be specified, for payment to the appropriate laboratory for carrying out the necessary analysis or test in relation to the goods in question; (e) the District Forum shall remit the amount deposited to its credit under clause (d) to the appropriate laboratory to enable it to carry out the analysis or test mentioned in clause (c) and on receipt of the report from the appropriate laboratory, the District Forum shall forward a copy of the report along with such remarks as the District Forum may feel appropriate to the opposite party
Subs. by Act 62 of 2002, sec. 9, for "Procedure on receipt of a complaint" (w. e. f. 15-32003).
38 39

days

as

may

be

granted

by

the

District

Forum

period

as

may

be

granted

by

the

District

Forum

Subs. by Act 62 of 2002, sec. 9, for "on receipt of a complaint" (w. e. f. 15-3-2003).

(f) if any of the parties disputes the correctness of the findings of the appropriate laboratory, or disputes the correctness of the methods of analysis or test adopted by the appropriate laboratory, the District Forum shall require the opposite party or the complainant to submit in writing his objections in regard to the report made by the appropriate laboratory ; (g) the District Forum shall thereafter give a reasonable opportunity to the complainant as well as the opposite party of being heard as to the correctness or otherwise of the report made by the appropriate laboratory and also as to the objection made in relation thereto under clause (f) and issue an appropriate order under section 14. .
40

(2) The District Forum shall, if the complaint received by it

under section 12 relates to goods in respect of which the procedure specified in sub-section (1) cannot be followed, or if the complaint relates to any services, (a) refer a copy of such complaint to the opposite party directing him to give his version of the case within a period of thirty days or such extended period not exceeding fifteen days as may be granted by the District Forum ; (b) where the opposite party, on receipt of a copy of the complaint, referred to him under clause (a) denies or disputes the allegations contained in the complaint, or omits or fails to take any action to represent his case within the time given by the District Forum, the District Forum shall proceed to settle the consumer dispute, (i) on the basis of evidence brought to its notice by the complainant and the opposite party, where the opposite party denies or disputes the allegations contained in the complaint, or (ii) on the basis of evidence brought to its notice by the complainant where the opposite party omits or falls to take any action to represent his case within the time given by the Forum.
41

(3) No proceedings complying with the procedure laid down in sub-

sections (1) and (2) shall be called in question in any court on the
Subs. by Act 62 of 2002, sec. 9, for clause "(a) refer a copy of the complaint to the opposite party mentioned in the complaint directing him to give his version of the case within a period of thirty days or such extended period not exceeding fifteen days as may be granted by the District Forum;"(w. e. f. 15-3-2003). 41 Subs. by Act 62 of 2002, sec. 9, for "complaint received" (w. e. f. 15-3-2003).
40

ground that the principles of natural justice have not been complied with.
42

(4) For purposes of this section, the District Forum shall have

the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908), while trying a suit in respect of the following matters, namely or witness and examining the witness on oath; (ii) the discovery and production of any document or other material object producible as evidence; (iii) the reception of evidence on affidavits; (iv) the requisitioning of the report of the concerned analysis or test from the appropriate laboratory or from any other relevant source; (v) issuing of any commission for the examination of any witness; and (vi) any other matter which may be prescribed.
43

:-

(i) the summoning and enforcing attendance of any defendant

(5) Every proceeding before the District Forum shall be deemed to be

a judicial proceeding within the meaning of sections 193 and 228 of the Indian Penal Code (45 of 1860), and the District Forum shall be deemed to be a civil court for the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).
44

(6) Where the complainant is a consumer referred to in sub-clause

(iv) of clause (b) of sub-section (1) of section 2, the provisions of rule 8 of Order I of the First Schedule to the Code of Civil Procedure, 1908 (5 of 1908) shall apply subject to the modification that every reference therein to a suit or decree shall be construed as a reference to a complaint or the order of the District Forum thereon. 14. `FINDING OF THE DISTRICT FORUM .

(1) If, after the proceeding conducted under section 13, the District Forum is satisfied that the goods complained against suffer from any of the defects specified in the complaint or that any of the allegations contained in the complaint about the services are proved, it shall issue an order to the opposite party directing him to the following things, namely laboratory from the goods in question
Subs. by Act 62 of 2002, sec. 9, for "on the basis of evdence" (w. e. f. 15-3-2003). Ins. by Act 62 of 2002, sec. 9 (w. e. f. 15-3-2003). 44 Ins. by Act 50 of 1993, sec. 11 (w. e. f. 18-6-1993).
42 43 45

45

(do) one or more of : ;

(a) to remove the defect pointed out by the appropriate

Subs. for take by the Consumer (Amendment ) Act, 1993 (w.e.f. 18-6-1993)

(b) to replace the goods with new goods of similar description which shall be free from any defect the charges paid by the complainant (d) to pay such amount as may be awarded by it ; ; as ; (c) to return to the complainant the price, or, as the case may be,

compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party
46

(e) to remove the defects or deficiencies in the services in

question; (f) to discontinue the unfair trade practice or the restrictive trade practice or not to repeat them (g) not to offer the hazardous goods for sale sale; (i) to provide
47

; ;

(h) to withdraw the hazardous goods from being offered for

(2) Every proceeding referred to in sub-section (1) shall be conducted together :

by the President of the District Forum and at least one member thereof sitting Provided that where the member, for any reason, is unable to conduct the proceeding till it is completed, the President and the other member shall conduct such proceeding de novo. (2A) Every order made by the District Forum under sub-section (1) shall be signed by its President and the member or members who conducted the proceeding : Provided that where the proceeding is conducted by the President and one member and they differ on any point or points, they shall state the point or points on which they differ and refer the same to the other member for hearing on such point or points and the opinion of the majority shall be the order of the District Forum. (3) Subject to the foregoing provisions, the procedure relating to the conduct of the meetings of the District Forum, its sittings and other matters shall be such as may be prescribed by the State Government. 15. APPEAL Any person aggrieved by an order made by the District Forum may prefer an appeal against such order to the State : Commission within a period of thirty days from the date of the order, in such form and manner as may be prescribed Provided that the State Commission may entertain an appeal after the
46

Ins. by the Consumer Protection (Amendment)Act of 1993, (w. e. f. 18-6-1993). Subs. by Act 34 of 1991, sec.2, for sub-section (2) (w. r. e. f. 15-6-1991).

47

expiry of the said period of thirty days if it is satisfied that there was sufficient cause for not filing it within that period. 16. COMPOSITION OF THE STATE COMMISSIONEach State Commission shall consist of (a) a person who is or has been a Judge of a High Court, appointed by
48

the

State

Government,

who

shall

be

its

President

(Provided that no appointment under this clause shall be made except

after consultation with the Chief Justice of the High Court); (b) two other members, who shall be persons of ability, integrity and standing and have adequate knowledge or experience of, or have shown capacity in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration, one of whom
49

shall be a woman

(Provided that every appointment made under this clause shall be :, , .

50

made by the State Government on the recommendation of a selection committee consisting of the following, namely (i) President of the State Commission Chairman (ii) Secretary of the Law Department of the State Member the State Member) other terms and conditions of service Government.
51

(iii) Secretary, incharge of Department dealing with consumer affairs in (2) The salary or honorarium and other allowances payable to, and the (***) of the members of the State Commission shall be such as may be prescribed by the State (3) Every member of the State Commission shall hold office for

a term of five years or up to the age of sixty-seven years,

48

Ins. by the Consumer Protection (Amendment) Act of 1993, (w. e. f. 18-6-1993).

49

Subs. by Act 62 of 2002, sec. 12, for clauses "(b) two other member, who shall be persons of ability, integrity and standing and have adequate knowledge or experience of, or have shown capacity in dealing with, problems relating to economics law, commerce, accountancy, industry, public affairs or administration, one of whom shall be a woman: Provided that every appointment made under this clause shall be made by the State Government of the recommendation of a selection committee consisting of the following, namely:(i) President of the State Commission -Chairman (ii) Secretary of the Law Department of the State -Member (iii) Secretary, incharge of Department dealing with consumer affairs in the State-Member (w. e .f. 15-3-2003).
The words "(including tenure of office)" omitted by Act 50 of 1993, sec. 13 (w. e. f. 18-61993). 51 Subs. by Act 50 of 1993, sec. 13 (w.e.f. 18-6-1993) and again subs by Act 62 of 2002, Sec. 12, for sub-section "(3) Every member of the State Commission shall hold office for a term of five years or up to the age of sixty-seven years, whichever is earlier and shall not be eligible for re-appointment." and sub-section "(4) notwithstanding anything contained in sub-section (3), a person appointed as a President or as a member before the Commencement of the Consumer Protection (Amendment) Act, 1993 (50 of 1993), shall continue to hold such office as President or member, as the case me be, till the completion of his term." (w.e.f. 15-32003).
50

whichever

is

earlier

and

shall

not

be

eligible

for

re-

appointment. (4) Notwithstanding anything contained in sub-section (3), a person appointed as a President or as a member before the commencement of the Consumer Protection (Amendment) Act, 1993, shall continue to hold such office as President or member, as the case may be, till the completion ] of his term.
52

17. JURISDICTION OF THE STATE COMMISSION have jurisdiction (a) to entertain compensation, if any, claimed exceeds rupees does : not exceed rupees
53

. (twenty lakhs but CRORE and

Subject to the other provisions of this Act, the State Commission shall

(i) complaints where the value of the goods or services and ONE

(ii) appeals against the orders of any District Forum within the State; and (b) to call for the records 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 Commission 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 of its jurisdiction illegally or with material irregularity. 19. Appeals Any person aggrieved by an order made by the State Commission in exercise of its powers conferred by sub-clause (i) of clause (a) of section 17 may prefer an appeal against such order to the National Commission within a period of thirty days from the date of the order in such form and manner as may be prescribed : Provided that the National Commission may entertain an appeal after the expiry of the said period of thirty days if it is satisfied that there was
54

sufficient

cause

for

not

filing

it

within

that

period:

[ Provided Further that no appeal by a person, who is required

to pay any amount in terms of an order of the State

Section 17 re-numbered as sub-section (1) thereof by Act 62 of 2002, sec.13 (w.e.f. 15-32003).
52

Subs. by Act 62 of 2002, sec. 13, for "exceeds rupees five lakhs but does not exceed rupees twenty lakhs" (w.e.f. 15-3-2003). 54 Ins. by Act 62 of 2002, Sec. 16 (w.e.f. 15-3-2003).
53

Commission, shall be entertained by the National Commission unless the appellant has deposited in the prescribed manner fifty per cent, of the amount or rupees thirty-five thousand, whichever is less.] 19A. Hearing of appeal
55

[19A. Hearing of appeal.-

An appeal filed before the State Commission or the National Commission shall be heard as expeditiously as possible and an endeavor shall be made to finally dispose of the appeal within a period of ninety days from the date of its admission : Provided that no adjournment shall be ordinarily granted by the State Commission or the National Commission, as the case may be, unless sufficient cause is shown and the reasons for grant of adjournment have been recorded that in the writing State by such or Commission: the National Provided Further Commission

Commission, as the case may be, shall make such orders as to the costs occasioned by the adjournment as maybe provided in the regulations made under this Act: Provided Also that in the event of an appeal being disposed of after the period so specified, the State Commission or, the National Commission, as the case may be, shall record in writing the reasons for the same at the time of disposing of the said appeal.] 20. Composition of the National Commission (1) The National Commission shall consist of(a) a person who is or has been a Judge of the Supreme Court, to be appointed by the Central Government, who shall be its President:
1

[Provided that no appointment under this clause shall be made except ;] [(b) not less than four, and not more than such number of

after consultation with the Chief Justice of India

2

members, as may be prescribed, and one of whom shall be a woman, who shall have the following qualifications, namely:(i) be not less than thirty-five years of age and (iii) be persons of ability, integrity and standing and have adequate knowledge and experience of at least ten years in dealing with ; (ii) possess a bachelor's degree from a recognized university;

55

Ins. by Act 62 of 2002, Sec. 17 (w.e.f. 15-3-2003).

problems

relating

to

economics,

law,

commerce,

accountancy,

industry, public affairs or administration: Provided that not more than fifty per cent, of the members shall be from amongst the persons having a judicial . background

Explanation.--For the purposes of this clause, the expression "persons having judicial background" shall mean persons having knowledge and experience for at least a period of ten years as a presiding officer at the he(a) has been convicted and sentenced to imprisonment for an offence which, in the opinion of the Central Government, involves moral turpitude; or (b) is an undischarged insolvent; or (c) is of unsound mind and stands so declared by a competent court; or (d) has been removed or dismissed from the service of the Government or a body corporate owned or controlled by the Government; or (e) has, in the opinion of the Central Government, such financial or other interest as is likely to affect prejudicially the discharge by him of his functions as a member; or (f) has such other disqualifications as may be prescribed by the Central Government: Provided also that every appointment under this clause shall be made by I. Central Government on the recommendation of a Selection Committee consisting the following, namely 21. JURISDICTION OF THE NATIONAL COMMISSION Subject to the other provisions of this Act, the National Commission shall have jurisdiction (a) to entertain (i) complaints where the value of the goods or services and compensation, if any, claimed exceeds rupees
56

district

level

court

or

any

tribunal

at

equivalent

level:

Provided further that a person shall be disqualified for appointment, if

:-

(one crore); and

(ii) appeals against the orders of any State Commission; and (b) 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
56

Subs. by Act 62 of 2002, Sec. 19 for "rupees twenty lakhs" (w. e. f. 15-3-2003).

vested, or has acted in the exercise of its jurisdiction illegally or with material irregularity.
57

22. POWER OF AND PROCEDURE APPLICABLE TO THE NATIONAL COMMISSION The National Commission shall, in the disposal of any complaints or any proceedings before it, have (6) of section 13 ; (a) the powers of a civil court as specified in sub-sections (4), (5) and (b) the power to issue an order to the opposite party directing, him to do any one or more of the things referred to in clauses (a) to (i) of subsection (1) of section14, and follow such procedure as may be prescribed by the Central Government).

23.

APPEAL Any person aggrieved by an order made by the National Commission in exercise of its power conferred by sub-clause (i) of clause (a) of section 21, may prefer an appeal against such order to the Supreme Court within a period of thirty days from the date of the order: Provided that the Supreme Court may entertain an appeal after the expiry of the said period of thirty days if it is satisfied that there was sufficient cause for not filing it within that period.
58

[Provided further that no appeal by a person who is required to pay

any amount in terms of an order of the National Commission shall be entertained by the Supreme Court unless that person had deposited in the prescribed manner fifty per cent. of that amount or rupees fifty thousand, whichever is less.] 24. FINALITY OF ORDERS Every order of a District Forum, State Commission or the National Commission shall, if no appeal has been preferred against such order under the provisions of this Act, be final
57

Ins. by Act 50 of 1993, Sec. 18 (w.e.f. 18-6- 1993) and subs. by Act 62 of 2002, Sec 20 for section "22. Power of and procedure applicable to the National Commission.- The National Commission shall, in the disposal of any complaints or any proceedings before it, have(a) the powers of a civil court as specified in sub-section (4), (5) and (6) of section 13; (b) the power to issue an order to the opposite party directing him to do any one or more of the things referred to in clauses (a) to (i) of sub-section (1) of section 14, and follow such procedure as may be prescribed by the Central Government." (w.e.f. 15-32003)..
58

Ins. by Act 62 of 2002, Sec. 21 (w.e.f. 15-3-2003).

59

(24A. LIMITATION PERIOD (1) The District Forum, the State Commission or the National Commission shall not admit a complaint unless it is filed within two years from the date on which the cause of action has arisen. (2) Notwithstanding anything contained in sub-section (1), a complaint may be entertained after the period specified in sub-section (1), if the complainant satisfies the District Forum, the State Commission or the National Commission, as the case may be, that he had sufficient cause for not filing the complaint within such period: Provided that no such complaint shall be entertained unless the National Commission, the State Commission or the District Forum, as the case may be, records its reasons for condoning such delay.

CHANGING SCENARIO OF CONSUMER MOVEMENT IN INDIA: PROBLEMS AND PROSPECTS

The Consumer Protection Act, 1986, a milestone in the history of socio-economic legislation in India, has considerably consolidated the process of consumer protection and has given rise, during the past few years, to new consumer jurisprudence. The Act introduced a threetier quasi-judicial consumer disputes redressal mechanisms at the district, State and national levels for dispensing inexpensive and time-bound consumer justice. Though passed in 1986, its effective implementation started only in 1990 when the institutions envisaged under the Act were established by and large throughout the country, thereby enabling a large number of consumers and organizations to approach these Forums for the redressal of their grievances. This has contributed to the growth of consumer organizations, the emergence of specialized consumer law reporters and a much higher profile for consumer protection in India than ever before. Ever since 1990 when the consumer protection mechanisms started functioning actively, certain remarkable changes have been witnessed in the Indian legal system. These changes were, however, preceded by a considerable number of problems associated-first with the establishment60 and then with the smooth functioning of these mechanisms61.

Ins. by Act 50 of 1993, Sec. 19 (w. r. e. f. 18-6-1993). Common cause v.Union of India &Ors., 1991(2)CPR523(SC) 61 Gurjeet Singh(1996): The Law of Consumer Protection in India:Justic With Reach, New Delhi: Deep & Deep Publication.
59 60

(I)

PROMINENT

DEVELOPMENTS

IN

THE

ARENA

OF

CONSUMER

PROTECTION IN INDIA

There are at least three prominent developments in the arena of consumer protection in India. These are:(a) Increased amount of business self-regulation;(b) Growth and development of social action litigation vis--vis consumer protection; and (c) Emergence of environmental litigation before the consumer Forums. The increasing ambit and amplitude of the Consumer Protection Act, 1986 has compelled the public as well as the private sector to regulate itself in the interest of consumers. The impact is accordingly visible in case of airlines, banks, education, insurance industry, railways, roadways and telecommunications. On the other hand, selfregulation by the private sector has primarily been reflected in their Business Norms and Codes of Ethics62. If you go the market you will now find that if any consumer says he will complain, the article sold is replaced, though in the cash memo it is mentioned that goods sold will not be taken back. A sense of fright has now come. The manufacturers do not want a bad name for their products. The moment a complaint is filed before a state commission, they offer to replace the article. Thus there is now a greater demand for accountability on the part of both public as well as the private sector. A significant number of decisions by the consumer forums against the corporate sector has brought home the clear message that consumers are not going to tolerate the unethical practices and irresponsible behaviour of the public or private corporate sector any more. (II) PROSPECTS OF CONSUMER MOVEMENT IN INDIA After discussing the three prominent developments in the arena of consumer protection, I now turn to the problems and prospects of the consumer movement in the coming years. As a matter of fact, three major problems are confronting the consumer protagonists in India. The first problem concerns active functioning of the Consumer Forums throughout the country. Not with standing the fact that these Forums have now been established, by and large, throughout the country, consumer activists and organizations have been repeatedly voicing their grievances against the smooth functioning of these Forums. They argue that these Forums have also started behaving like Civil Courts and are likely to have mounting arrears soon. In addition,
62

these

Forums

still

lack

basic infrastructural

Business Norms And Codes Of Ethics of the Advertising Standards Council of India (ASCI), Association Chamber of Commerce and Industry of India(ASSOCHAM),Federation of Indian Chambers of Commerce and Industry(FICCI).

facilities. The members sit only part-time and 90 days decisionmaking requirement is not strictly adhered to. There are also ego and status problems between judicial members and the members with non-judicial background. Another significant problem is that the stay orders from the High Courts have begun to hold up a large number of cases filed before the Consumer Forums, thereby denying the benefits of speedy and inexpensive redressal machinery promised under the Consumer protection Act, 1986. The second problem concerns the applicability of the Consumer protection Act, 1986 to various services. As is evident, ever since the implementation of the 1986 Act, whereas there has hardly been any significant case in which the goods has been vehemently contested, there is a voluminous amount of case law which involved determination of the meaning, definition, and ambit of the term service. Section2(1)(o)of the 1986 Act categorizes certain specific types of services which, inter alia, include banking, financing, insurance, transport, amusement and entertainment. The definition of the term service had already been kept very wide and now with the inclusion of the two terms housing and construction by the Consumer Protection (Amendment) Act, 1993, it has been further widened. Only two types of services have been kept out of the ambit of the 1986 Act. They are services rendered free of charge and services rendered under a contract of personal service63. The non-mentioning of services like education, health, housing, had posts and given telegraphs these services and an telecommunications presumably

impression of their exclusion from the ambit of this legislation. At the initial stages, therefore, these services contested the jurisdiction of the 1986 Act, thereby claiming complete immunity from their governance by it. The Consumer Forums, however, have appreciably stood the test of time and have brought all these services within the ambit of the 1986 Act. Making consumers aware of their rights and taking consumer movement to the rural India is the third and perhaps the most important problem and a challenge before the consumer organizations. As is well known, most consumers are still ignorant of their rights, much less of being assertive about them64.

63

Gurjeet Singh (1994) : The Concept of Contract of Personal Service under The Consumer Protection Act, 1986. In : Consumer Protection & Trade Practices Journal, Vol. 2, No. 3 (March) pp 51-56 64 Pushpa Girimaji (1993): Most Consumers Ignorant of Rights. In : The Tribune (22 Oct.) ; p 12

Though the Government appears to be serious of this issue 65, much however depends upon the consumer organizations. They have still to cover a very long distance so far as taking the movement to rural areas is concerned. In conclusion, it would argue that consumer protection movement has got a bright future in India. A part from Governmental seriousness in the matter, consumer activists, organizations, and other voluntary associations have also to play their part in the furtherance of consumer movement. Above all, the consumers have to be aware of their rights and should assert them selves in the market place.

65

Government Aim Protection of Consumers. In The Tribune (14th Dec.) p 7