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Social & Legal Issues

Consumer Protection Act 1986 The Consumer Protection (Amendment) Act 2002 The Consumer Protection (Amendment) Act 2005

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Objectives of the Act


1. 2. 3. 4. 5. 6. 7. Protection of Interest of Consumers Protection of Rights of Consumer: Right to be protected against marketing of goods and services which are hazardous to life and property Right to be assured of Goods and services at competitive price Right to be informed about the quality quantity, potency, purity standard and Price Right to be Heard Right to seek redressal Right to consumer Education: Consumer protection councils Quasi-judicial machinery

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Who is a Consumer
Consumer means any person who: a) Buys any goods for consideration which has paid, or promised or partly paid or 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 persons, but does not include a person who obtain such goods for resale or any other commercial purpose

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Who is a Consumer contd


b) Hires or avails of any services for a consideration which has been paid or promised or partly paid or partly promised, or under system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised or partly paid or partly promised, or under 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. Commercial purposes does not include use by a person of goods bought and used by him and services availed by him exclusively for the purpose of earning his livelihood by means of self employment.

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Goods
According to the sale of Goods Act- Goods means every kind of movable property other than the actionable claims and money; and includes stocks and shares, growing crops, grass and things attached to or forming part of land which are agreed to be severed before sale or under the contract of sale. Flats and housing was included under goods in 1993

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Services

Services of any description which is available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information Housing construction is a service

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Complainant
a) b) Acc to the Act, Complainant meansA consumer; or Any voluntary consumer association registered under the companies act,1956 or under any other law for the time being in force, or The central government or any state government; One or more consumers, where there are numerous consumers having the same interest In case of a death of a consumer, his legal heir or representative; who or which makes complaint

c) d) e)

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Complaint Complaint means any allegation in writing made by a complainant with a view to obtain any relief under the Act

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Restrictive Trade Practice


According to Act: Restrictive trade practice means a trade practice which tends to bring about manipulation of price or its conditions of delivery or to affect the flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include: Delay beyond the period agreed to by a trader in supply of such goods or in providing the services which has led or is likely to lead to rise in the prices Any trade practice which requires a consumer to buy, hire or avail of any goods or, as the case may be, services as condition precedent to buying, hiring or availing of other goods or services.

a) b)

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Unfair Trade Practices


Unfair means and deceptive practices Misleading advertisements Making of false statements Publication of any advertisement for the sale at a bargain price that are not intended to be offered for sales Not providing gifts/prizes after declaration of results

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CASE

Amit bought a television set from an electronic store for using it at home. The television was defective. Is Amit a consumer? Sumit, on a holiday with his family, hired a taxi service. The taxi was in poor condition, the driver did not have adequate rest and drove rashly. The taxi broke down on two occasions and eventually all of them in the middle of the hills. They could not reach in time to catch their flight. Is Sumit a consumer?

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Case Amit bought a pressure cooker for use by his family. In the first use itself, while his wife Simi was using it, the pressure cooker burst, hurting her. Is Amit a consumer? Is Simi a consumer? Amit bought a pressure cooker for use by his family. He paid only 30% of the price while remaining was to be paid a week later. The cooker was defective. It burst in the second use. Is Amit a consumer?

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Case
Sujit bought a pressure cooker for domestic use. The money for it was to be paid next week. It burst in the second use? Is Sujit a consumer? Suman bought a cell phone for personal use .The payment of the phone was to start the following month. The payment was to be one in six monthly installments. The phone was defective. Is Suman a consumer?

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Cases A manufacturer of pens was distributing his pens free to the visitors to an exhibition. The pens were defective and leaking. The pens spoilt the clothes of several persons. Sunita is one of the persons who has spoilt her clothes. Is she a consumer?

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Consumer Dispute Redressal Agencies


Point of Distinction District Forum State Commission National Commission

Territorial Jurisdiction

1 or more districts

One or more state Serving, or Retired Judge of high court

All India

Qualification of Serving, President Retired or qualified district judge

Serving, or Retired Judge of supreme court

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Contd.
Composition President and two members-1 woman Age 35,graduate, 10 yrs ex. in eco,law,a/c,ecommerce Yes President and President and min. 2 members- min. 4 members1 woman 1 woman Same as District Forum Same as District Forum

Qualification

Re-appointment

Yes

Yes

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Contd
Monetary Jurisdiction Upto 20 lakhs 20 lakhs-1 crore More than one crore

Administra-tive State Control commission

National commission

Penalties

Imprisonment for not less than 1 mth but can extend to 3 yrs. Fine not less than 2000.

Frivolous complaint

Dismiss the complaints and costs upto Rs 10000/-

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Procedure for making a Complaint


A complainant can make a complaint before the appropriate consumer dispute redressal agency. The complaint relating to any goods and services is given to the opposite party within 21 days . The opposite party is allowed to put forth his version within 30 days. In case of defect in goods, a sample of the goods is sent to the lab for a report within 45 days. The report is given to the opposite party. A complaint shall be decided within 3 months if no lab test is required and within 5 months if the lab test is required.

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Findings
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. The following orders can be made by the consumer dispute redressal agency: To remove the defect To replace the goods To return to the complainant the price To pay compensation To remove the defects in goods or deficiencies in services. To discontinue the unfair trade practice Not to offer hazardous goods To cease manufacture of hazardous goods. To issue corrective advertisement To provide for adequate cost

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Decisions of National commission and Supreme court


Doctors are within the purview of this act Government hospitals/health centres who render service for free the provisions of the act do not apply. Damages are payable if there is negligence of the opposite party . Provident fund subscribers are also consumers. Deficiency of railway services. Confirmed ticket not providing a seat is a deficiency of service. Nursing home not able to manage emergency is a negligence of service.

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Decisions of National commission and Supreme court


Deceased husbands premium was not deduced from salary wife can claim the benefits Unauthorized escalation of price due to delay of delivery. Full payment done for flat, but due to some reasons flat not allotted and advised to opt for another scheme is not valid This is deficiency of service

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Cases

Consumer and Commercial Use Synco Textiles private limited vs Greaves Cotton Interpretation of Livelihood Western India State Motors v.Sobhag Mal Meena Privity of Contract R.Balraj v Grindlays Bank and State Bank of India