Aims and objects of the CPA, 1986

Making money quickly is a very tempting proposition. Businesses, companies, shopkeepers, retailers, and sellers are all interested in maximizing their profits. In doing so, very often they neglect the best interests of the buyer. Many times, a buy gets a defective product, or a product that fails to perform as promised. Besides losing money put in purchasing a product, sometimes, due to defects in the product, the buyer is injured as ell. In all such cases, there is a violation of a legal right of the buyer and he is entitled to sue the seller. Before enactment of the !onsumer "rotection #ct, $%&', filing a civil suit for damages as the only option available to an aggrieved buyer. (o ever, such a suit is very expensive and time consuming, because of hich, buyers ere not able to use this mechanism for relatively smaller amounts. ) his gave a field day to the traders because making substandard products or not delivering on promises as a cheap option to make quick money, after all, very fe buyers ould go to court. # common man as completely helpless because of no control and penalty over unscrupulous sellers. In this background, the !"# $%&' gave po er in the hands of the buyer by allo ing, an easier and cheaper ay to redress their grievances, thereby holding the sellers accountable for their actions more often. It provides redress to a consumer hen the purchased product is defective or hen there is a deficiency in service. )he follo ing are aims and objectives of this act * $. )he most important objective of this act is to provide a fast and cheap consumers to hold the sellers accountable for their products or services. +. ,ustice to consumers. ay for

-. "rotection of consumers from fraudsters or companies selling substandard products and services. .. "enalty to sellers for substandard product or service. /. !heck on sellers and service providers. Besides the above objectives, 0ection ' of !"# $%&' also provides certain rights as objectives to the consumers. )hese are * $. 1ight to be protected against goods that are hazardous or dangerous to life and property. +. 1ight to be informed about the quality, quantity, potency, purity, standard and price or a product and service. -. 1ight to competitive pricing. .. 1ight to be heard and to be assured that consumer interest consideration at appropriate forum. ill receive due

/. 1ight to redressal against unfair trade practices and exploitation of consumers.

'. 1ight to consumer education. It is a complete code in the sense that it provides complete details of the constitution and jurisdiction of the commission and procedure for filing the complaint and appealing the decision. It does not depend on !"! and the cases can be finalized completely under this act. In fact, as held in Ansal Properties vs Chandra Bhan Kohli 1991, !onsumer 2isputes 1edressal #gencies provide complete machinery for justice including a final appeal to the 0upreme !ourt and so are outside the scope of (igh !ourts and (!s can3t entertain rit petitions against their judgments. 4nder Section 9 of this act, three agencies are established to hear consumer complaints * 1. # !onsumer 2isputes 1edressal 5orum in each district 65or amounts up to +7 8akhs9 . # !onsumer 2isputes 1edressal !ommission in each state. 65or amounts from +7 8akhs to $ !rore9 !. # :ational !onsumer 2isputes 1edressal !ommission in the center. 65or amounts above $ crore9

"istrict #or$m
Composition %Section 1&' $. ;ach 2istrict 5orum shall consist of * a. # person ho is, or ho has been or is qualified to be, a 2istrict ,udge, ho shall be its "resident b. t o other members, one of hom shall be a oman, ho shall have the follo ing qualifications, namely * $. be not less than thirty*five years of age, +. posses a bachelor3s degree from a recognized university, -. be persons of ability, integrity and standing, .. and have adequate kno ledge and experience of at least ten years in dealing ith problems relating to economics, la , commerce, accountancy, industry, public affairs, or administration $*#. ;very appointment under sub*section 6$9 shall be made by the 0tate <overnment on the recommendation of selection !ommittee consisting of the follo ing namely= $. )he "resident of the 0tate !ommission * !hairman, +. 0ecretary, 8a 2epartment of the 0tate * Member, -. 0ecretary, in charge, of the 2epartment dealing ith !onsumer affairs in the 0tate * Member.

+. ;very member of the 2istrict 5orum shall hold office for a term of five years or up to the age of sixty*five years> hichever is earlier=

-. )he salary or honorarium and other allo ances payable to, and the other terms and conditions of service of the members of the 2istrict 5orum shall be such as may be prescribed by the 0tate <overnment.

($risdiction %Section 11' $. Pec$niar) ($risdiction * 0ubject to other provisions of this #ct, the 2istrict 5orum shall have jurisdiction to entertain complaints here the value of the goods or services and the !ompensation if any, claimed does not exceed rupees t enty lakhs.

+. *erritorial ($risdiction + # complaint shall be instituted in a 2istrict 5orum ithin the local limits of hose jurisdiction, * $. )he opposite party or each of the opposite parties, here there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office, or? personally orks for gain or +. #ny of the opposite parties here there are more then one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office, or personally orks for gain, provided that in such case either the permission of the 2istrict 5orum is given, or the opposite parties ho do not reside, or carry on business or have a branch office, or personally orks for gain, as the case may be, acquiesce in such institution@ or -. )he cause of action, holly or in part arises. 5or a complaint to lie in a district forum, at least a part of the transaction of the actual business must have occurred in that district. In ,ational -ns$rance Co vs Sonic S$r.ical &&!, a fire accident took place in #mbala and a part of the claim as partly processed in !handigarh. It as held that merely processing of claim in one place does not form a ground to file a case in that district. #$nctionin. of a "istrict #or$m /ho can file a complaint %Section 1 ' )he follo ing can file a complaint * $. )he consumer to hom the goods or services have been sold or are agreed to be sold.

+. #ny recognized consumer association even if the consumer is not a member of the association. 1ecognized means any voluntary association registered under !ompanies #ct $%/' or any other la for the time being in force. -. Ane or more consumers, here there are numerous consumers all having same interest, ith the permission of district forum. .. )he state or central government. )he complaint must be accompanied as may be prescribed. ith such amount of fee and payable in such manner

)he forum may accept or reject the complaint. )he complainant must be given an opportunity to be heard before rejection. )he acceptance or rejection ill be decided in +$ days. Provisions for Appeal %Section 10' 5rom 2istrict 5orum to 0tate !ommission order %Section 10' ithin a period of -7 days from the date of the

5rom 0tate !ommission to :ational !ommission ithin a period of -7 days from the date of the order %Section 19' 5rom :ational !ommission to 0upreme !ourt of the order %Section !' ithin a period of thirty days from the date

/ho is Cons$mer1 #s per 0ection + 6$9 6d9 of !"# $%&' * B!onsumerB means any person ho, *

6i9 Buys any goods for a consideration hich 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 ho buys such goods for consideration paid or promised or partly paid or partly promised or under any system of deferred payment hen such use is made ith the approval of such person but does not include a person ho obtains such goods for resale or for any commercial purpose@ or 6ii9 (ires or avails of any services for a consideration hich 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 than the person ho hires or avails of the services

for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, hen such services are availed of ith the approval of the first mentioned person but does not include a person o avails of such services for any commercial purpose@ Based on this definition, the follo2in. are essential elements of a Cons$mer3 1. B$)s .oods or 4ires Services + "hysical products such as !ar, )C, 4tensils etc as ell as intangible services ranging from (air !utting 0aloon to Banking etc. are both valid purchases for being a consumer. )he scope of services is quite ide and more and more things are coming into its ambit slo ly. 5or example, in the landmark case of -ndian 5edical Association vs 6P Shantha and others 1990 , 0! held that patients treated by a medical professional is also a consumer of medical services and is covered by !"#.

. #or consideration * )o be a consumer, paying consideration is a must. (o ever, consideration may be an immediate payment or a promise of future payment in full or in part. It can also be any arrangement of deferred payments. 5urther, unlike in 0ale of <oods #ct, consideration need not only be in the form of money but transaction of services, exchange or barter is also valid. In 5otor Sales 7 Service vs 8enji Sebastian 1991, the complainant booked a motor cycle to be delivered on a given date for a consideration. (is turn as ignored. )he dealer as ordered to give him the motorcycle for the price of that date and also /77>* as compensation. !. #or personal 9se * )he goods or service must be bought for personal use. Ariginally, a person ho bought a product or a service for commercial use as not considered a consumer but after the amendment in $%%-, use of such goods for making a livelihood is accepted. )hus, a self employed person ho buys a "hotocopy machine for his o n shop is a consumer. (o ever, goods must not be bought for resale. In Anant 8aj A.encies vs *:;C< 1996, a company bought a car for personal use of a director of the company. It as held that since the car as bought for personal use and not for commercial use or for making a profit on a large scale, the company as a consumer.

In 6as$ndhara 7 Bl$estar Co. vs B.K =o)al %1996' CP( 69 %,C', a ater cooler as purchased and it as installed at a bus stand for the use of general public free of charge. It as held that since the ater cooler as bought for use of general public free of charge and not for commercial use or for making a profit on a large scale, the complainant as a consumer.

>. 9se b) the p$rchaser or an) bod) else + It is not necessary that only the purchaser of the goods or services be the user. #nybody ho uses the goods or services ith due permission of the purchaser, is also a consumer. )hus, in a landmark case of Sprin. 5eado2s 4ospital vs 4arjot Ahl$2alia A-8 1998, SC held that the parents of the child ho as treated by the hospital ere hirers of the service hile the child as the beneficiary and thus both ere consumers.

"eficienc) in service
Service #s per Section %1' %o' B0ervicesB means service of any description hich is made available to potential users and includes, but not limited to, the provision of facilities in connection ith banking, 5inancing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction entertainment, amusement or the purveying of ne s or other information, but does not include the rendering of any service free of charge or under a contract of personal service@ Based on this definition, the scope of services is quite ide. It ill not be an exaggeration to says that any thing for hich a customer pays and that is not a physical product is a service. !inema halls, (ealth clubs, 4niversity, !ollege, are all service providers. In the landmark case of -ndian 5edical Association vs 6P Shantha and others 1990 , 0! held that patients treated by a medical professional is also a consumer of medical services and is covered by !"#. In 9nion of -ndia vs 5rs S Pra?ash 1991, )elephone facility as held as a service and the telephone rental paid by the consumer as the consideration for the service.

)he service must be a paid service. 5ree or non*profit services do not fall under this category and claims cannot be made regarding such services under the !"#. In A Srinivas 5$rth) vs Chairman, Ban.alore "evelopment A$thorit) 1991 , the question before the court as hether a tax payer is a consumer or not. # person, ho paid house tax, as bitten by a stray dog and he sued Bangalore 2evelopment #uthority for not taking care of the menace of stray dogs. It as held that there as no quid pro quo

bet een the tax and the services rendered by B2#. )he removal of stray dogs as a voluntary action of B2# and as done free of cost. )hus, the complainant as not a consumer and removal of dogs as not a service under this act. ,ust like a defect, hich renders a product not as useful as promised, there can be a deficiency in service, hich render a service not as useful as promised at the time of sale. !"# $%&' allo s consumers of services to take action against service providers for compensating for the deficiency in the promised service. "eficienc) #s per section %1'%.', B2eficiencyB means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance hich is required to be maintained by or under any la for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or other ise in relation to any service. )hus, in 5ahana.ar *elephone ,i.am vs 6inod Kar?are 1991, ith the telephone dept. as pending for more than six months, it deficiency in service. In -ndian Airlines vs S , Sin.h 199 , a metallic traveler because of hich his gums ere hurt. (e for deficiency in service. hen a complaint as held to be a

ire as present in the food given to a as a arded +777 1s as compensation