Table of Contents:-
- Consumer Protection Act 1986
- Objectives of Consumer Protection Act 1986
- Provisions for Settlement of Grievances under the Consumer Protection Act, 1986
- Importance of Consumer Protection Act 1986
Consumer Protection Act 1986
In 1986, the Indian government enacted the Consumer Protection Act, which subsequently took effect on July 1, 1987. The main objectives of the Act are to improve consumer protection and put in place comprehensive safeguards against various types of exploitation. These include providing defective goods and services and unfair trade practices. It also makes provisions for simple, speedy, and inexpensive machinery for the redressal of consumers’ grievances.
It provides constitutional rights of consumers, grievance lodging and redress mechanism. Being an informed cone and with a successful movement against corruption led by Anna Hazare, individuals can hope everyone would do their bit by knowing their rights as consumers and preventing any corruption committed by service providers.
The primary objective of the Consumer Protection Act 1986 is to advance and protect the rights and interests of consumers. The Consumer Protection Act aims to protect consumers’ legal rights from traders, suppliers, and other entities. Its primary objective is to ensure businesses provide adequate protection to consumers. This legislation aims to establish a fair and transparent marketplace, allowing consumers to confidently engage in transactions without fear of exploitation or unfair practices.
The Consumer Protection Act of 1986
It is important to recognize that a substantial number of consumers, referred to as small consumers, may not have significant legal knowledge. The Act not only provides inexpensive and expeditions remedies but also arms the Forums constituted under the Act with the power to enforce their orders by the coercive process by imposing imprisonment and fines. The Consumer Protection Act, of 1986 has opened up a new era in the field of business in India. It imparts a new dimension to the concept of law as a tool of social engineering.
The term ‘good’ under this Act has the same meaning as under the Sale of Goods Act. It includes all kinds of movable assets, except money, and covers items like stocks, shares, and growing crops, among others. The term ‘service’ means service of any description made available to potential users and includes banking, financing, transport, housing construction, entertainment, insurance, supply of electrical and other energy, boarding and lodging, amusement, etc. The Consumer Protection Act includes the services provided by doctors, engineers, architects, lawyers, and others.
Objectives of Consumer Protection Act 1986
The main objectives of the Act (according to the Preamble to the Act) is to provide for better protection of the interests of consumers. The government has established consumer councils and other authorities to resolve consumer disputes and related matters. According to the Act, its objective is as follows.
1) Protection of the Rights of Consumers
The Act takes measures to uphold consumers’ rights as specified in Section 6.
i) The Act ensures that consumers are provided with a variety of goods at competitive prices.
ii) Protection against goods that pose hazards to life and property is an assured right of consumers.
iii) The Act safeguards the right of consumers to receive information about the quality, quantity, potency, purity, standard, and price of goods.
iv) The Act ensures that consumers can seek redressal for unfair trade practices or unethical exploitation.
v) The Act guarantees consumers the right to voice their concerns and have their interests taken into account at appropriate forums.
vi) The right to a healthy environment.
vii) The right to consumer education.
2) Better Protection of the Interests of Consumers
The objective of this Act is to enhance the safeguarding of consumer interests. To achieve this, the Act proposes the establishment of Consumer Councils and other authorities responsible for resolving consumer disputes and related matters (as stated in the Preamble to the Act).
3) Quasi-Judicial System for Speedy Redressal of Consumer Disputes
The Act aims to offer a fast and straightforward resolution for consumer disputes. A quasi-judicial system operates at the District, State, and Central levels to fulfil this objective. These quasi-judicial bodies are responsible for upholding the principles of natural justice and are vested with the following powers:
i) To provide relief of a specific nature, and
ii) To award, wherever appropriate, compensation to the consumer.
4) Consumer Protection Councils
The establishment of Consumer Protection Councils at both the Central and State levels reflects a dedication to promoting and protecting consumer rights. Their unwavering efforts improve a just and transparent marketplace, empowering consumers to make informed choices and have confidence in the products and services they buy.
- nature of marketing
- difference between questionnaire and schedule
- features of marginal costing
- placement in hrm
- limitations of marginal costing
- nature of leadership
- difference between advertising and personal selling
Provisions for Settlement of Grievances under the Consumer Protection Act, 1986
The judicial machinery set up under the Consumer Protection Act, of 1986 consists of consumer courts (forums) at the district, state and national levels. These are known as the District Forum, State Consumer Disputes Redressal Commission (State Commission) and National Consumer Disputes Redressal Commission (National Commission) separately.
Let’s briefly explore their composition and roles:
1) State Commission
State governments establish this within their respective states. The State Commission consists of a President and not less than two and not more than such number of members as may be prescribed, one of whom shall be a woman. The Commission is led by an individual holding the rank of a High Court Judge. A written complaint can be filed before the State Commission where the value of goods or services and the compensation claimed exceeds 20 lac but does not exceed 1 crore. In case the aggrieved party is not satisfied with the State Commission’s decision, they can choose to appeal to the National Commission within 30 days of receiving the order.
2) District Forum
Each district’s state government supervises this institution. District forums comprise a Chairman and two additional members, with one of them mandated to be a woman. A District Judge leads the district forums. A written complaint can be filed before the District Consumer Forum where the value of goods or services and the compensation claimed does not exceed 20 lac. If a consumer disagrees with the District Forum’s decision, they can file an appeal with the State Commission within 30 days from the date of the order.
3) National Commission
The Central Government established the National Commission in 1988. It serves as the highest authority within the government’s three-tier judicial system established for addressing consumer complaints. Its office is situated at Janpath Bhawan (Old Indian Oil Bhawan), A Wing, 5 Floor, Janpath, New Delhi. It consists of a President and not less than four and not more than each member as may be prescribed, one of whom shall be a woman. A serving or retired judge of the Supreme Court heads the National Commission.
Consumers can file complaints directly with the National Commission if the value of goods or services and compensation exceeds 1 crore. An appeal can be filed against the order of the National Commission to the Supreme Court within 30 days from the date of the order passed.
It may be noted that to attain the objectives of the Consumer Protection Act, the National Commission has also been conferred with the powers of administrative control over all the State Commissions by calling for periodical returns regarding the institution, disposal and pending cases and issuing instructions for the adoption of uniform procedures, etc.
Importance of Consumer Protection Act 1986
1) Consumer Education
The importance of consumer protection is to create awareness among consumers about their rights and responsibilities by organising workshops and seminars and giving them the confidence to take legal action against companies that have defaulted.
2) Redressal of Complaints
Consumer protection ensures that consumer complaints find effective resolution in the appropriate consumer courts, securing justice for consumers.
3) Bulletins and Periodicals
Consumer protection organizations play an important role in advocating for fair treatment and protecting consumers’ interests. They effectively expose unfair trade practices through the publication of journals and periodicals. This educational effort informs the public and exerts pressure on businesses to prioritize consumer welfare. In this way, these organizations contribute to a more equitable marketplace and empower consumers to make informed choices.
4) Encouraging Honest Businessmen
The importance of consumer protection is to encourage honest businessmen organisations to give credit to the business organisations which aim at consumer satisfaction by publishing favourable reports in their periodicals. This helps in building goodwill for such organisations.
5) Connecting Link
Consumer protection organizations serve as a vital intermediary between dissatisfied consumers filing complaints and businesses that may have fallen short in meeting their obligations. These organizations play an important role in serving justice to the ultimate beneficiaries, the consumers.
Consumer protection serves as a powerful unifying force, rallying consumers in their fight against unfair trade practices. It champions unity, fairness, and accountability, empowering consumers to actively shape a marketplace that prioritizes their rights and well-being. Together, we can create a more equitable and transparent business environment that benefits everyone. Consumers are encouraged to form cooperative societies so that the focus is on providing services to members rather than earning profit at the cost of customers.
7) Protection from Exploitation
In the absence of consumer protection, consumers can fall prey to exploitation in various forms. These include the sale of unsafe products, hoarding and adulteration of goods, improper use of weights and measures, overpricing, and the distribution of low-quality items. Consumer protection is necessary for safeguarding the interests of individuals engaged in commercial transactions. However, when this protection is lacking, consumers can endure unscrupulous practices that harm their well-being. Various Consumer Protection Acts: business organisations are under pressure to keep away from exploiting consumers.
8) Getting Public Support
The importance of consumer protection does not isolate the business. Financial institutions and banks provide finance to businesses. The government provides support and incentives. Employees contribute their time, skill and labour. Consumers are ready to pay for value. Businessmen can get the best support from all these parties only when they stop exploiting their customers.
9) Quality Life for Consumers
Consumer protection is highly important because it aims to efficiently address consumer complaints and hold business organizations accountable for delivering a high quality of life to consumers. Moreover, prioritizing the delivery of justice to consumers is important.
10) Ethical Obligations
Consumer protection is of utmost importance. In the contemporary business landscape, ethics play a crucial and indispensable role. Businesses must maintain ethical values; any departure from these principles is akin to involvement in criminal activities. Protecting the interests of the consumer includes the absence of unfair business practices such as black marketing, profiteering, publishing false advertisements, etc. A businessman mustn’t practice such uneven means thereby protecting the interest of consumers.