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Friday, December 26, 2014

AHSEC - 12: Consumer Protection Important Notes for Feb' 2018 Exam

Unit – 12: Consumer Protection
Objective Questions (1 Mark):
1. What is the purpose of enacting the consumer protection Act 1986?
Ans: To protect and promote the interest of consumer.
2. Which consumer right gives the business firm freedom to set up their own consumer service and grievance cell?
Ans: Right to be heard.
3. Mohit filed a case against ‘Domestic Cooling ltd.’ in the ‘District Forum’, but was not satisfied with the orders of the District Forum. Where can he appeal further against the decisions of District Forum and in how many days?
Ans: Mohit can further appeal against the decision of District Forum in the ‘State Commission’ within 30 days.
4. Mohit filed a case against ‘Volvo Ltd.’ in the ‘State Commission’. But he was not satisfied with the orders of the ‘State Commission’. Name the authority to which he can appeal against the decisions of ‘State Commission’.
Ans: Amrit can further appeal in ‘National Commission’.
5. Ankit filed a case against ‘Mahindra Ltd.’ in the ‘National Commission’. But he was not satisfied with the orders of the ‘National Commission’. Name the authority to which he can appeal against the decisions of ‘National Commission’.                    2013

Ans: He can appeal in Supreme Court within 30 days.
6. Which claim can be approach before the Supreme Court under Consumer Protection Act?
Ans: An order passed by the national commission in a matter of its original claims exceeding Rs. 1 Crore can appear before the Supreme Court.
7. Ram wants to buy ghee. How can he check the quality of product?
Ans: Through ‘AGMARK’ symbol. “AGMARK” symbol is used for food products.
8. Ram wants to buy an iron. As an aware customer, how can he be sure about the quality of iron?         2012
Ans: Through “ISI” mark. “ISI” mark is used for electronic items.
9. Can a consumer file complaint in consumer court without having cash memo?
Ans: No, without cash memo he cannot file a complaint. Cash memo is the proof of the transaction.
10. List any three consumer organizations in India.
Ans: (i) Consumer Guidance Society of India (Mumbai), (ii) Common Cause (New Delhi), (iii) Citizen Action Group (Mumbai)
12. In what type of activities is Consumer Coordinating Council involved?
Ans: It is the main body of the Consumer Organizations of India. It conducts several programmes on consumer education for activists, etc. It has published training manuals on Consumer Protection Act
13. Name two consumer rights defined by UNO.
Ans: (i) Right to Basic Need. (ii) Right to Healthy Environment.
14. Rajiv, a vegetarian was traveling in Rajdhani Express was served food and later he found out that it had a non vegetarian content. His sentiments were hurt Will Rajiv be able to claim compensation, which right of the consumer is violated?
Ans: Yes, Rajiv will be able to claim the compensation as the railways have violated the Right to Information.
15. Mr. A suffers a loss of Rs.20, 00,000 due to bad quality of goods. Name the commission to which Mr. A approach for claim?
Ans: District Commission
16. Mr. A suffers a loss of Rs.1, 00, 00,000 due to bad quality of goods. Name the commission to which Mr. A approach for claim?
Ans: State Commission
17. Mr. A suffers a loss of Rs.1, 10, 00,000 due to bad quality of goods. Name the commission to which Mr. A approach for claim?
Ans: National Commission
SHORT QUESTIONS (3/ 5/6 Marks)
Q.N.1. Explain briefly the meaning of “consumer” with reference to Consumer Protection Act 1986. Who cannot be considered as consumer?
Ans: Consumer is a person who uses the goods. According to the Consumer Protection Act, 1986, a consumer is one:
a)      Who buys goods or hires services for consideration,
b)      Who uses the goods or hired services with the approval of the buyer or hirer of the service,
c)       Who uses the goods/services to earn livelihood by self-employment.
Who is not a consumer?
a)      An applicant for a passport has been held to be not a consumer.
b)      An applicant for ration card is not a consumer.
c)       The beneficiaries of municipal services are not in the category of consumers.
Q.N.2. Define consumer protection? What are the salient features and objectives of Consumer Protection Act?
Ans: Consumer protection refers to the education to the Consumer about their rights and responsibility, getting their grievances redressed and protection of their interest. For e.g.-: Protecting the consumer from black-marketing, adulteration, and hoarding.
Features of Consumer Protection Act are:
a)      The Act applies to all goods and services unless specially exempted by Union Government.
b)      It covers all sectors – public, private or cooperative.
c)       Provisions of the Act are compensatory in nature.
d)      It contains all consumers’ rights - to choose, to be heard, to be informed, to safety, education and redressal.
e)      It empowers consumers seeking discontinuance of trader’s malpractices, defective goods, service deficiencies or withdrawal of hazardous goods from the market.
a)      To assist in achieving or maintaining adequate protection for their consumers;
b)      To facilitate production and distribution patterns responsive to the needs and desires of consumers;
c)       To encourage high levels of ethical conduct for those engaged in the production and distribution of goods and services to consumers;
d)      To facilitate the development of independent consumer groups;
e)      To further international cooperation in the field of consumer protection;
Q.N.3. Who can file a complaint under the CP Act 1986 and under what circumstances? What are the features of a “Complaint”?
Ans:  A complaint before an appropriate consumer forum can be made by complainant who can be:
a)      Any consumer,
b)      Any registered consumer association,
c)       Central/state govt.,
d)      One or more consumer on behalf of many consumer having same interest,
e)      Legal representative of deceased consumer within two years.
"Complaint" can be made in the following cases:
a)      An unfair trade practice or a restrictive trade practice has been adopted by any trader;
b)      The goods suffer from one or more defect;
c)       The services suffer from deficiency in any respect;
d)      Price charged for the goods mentioned in the complaint is in excess of the price fixed under any law.
e)      Goods which will be hazardous to life and safety.
Features of Complaint: Complaint which is a written allegation made by any complainant should have the following features:
a)      The complaint must be in writing;
b)      The complaint must be made with a view to obtain any relief under the Act;
c)       The Complaint must make any of the five allegations mentioned above.
d)      The complaint must be filed in a manner prescribed under law.
e)      The complaint must be filed before appropriate consumer commission having jurisdiction to entertain complaint.
Q.N.9. How Complaints are filed? What are the remedies/reliefs available to consumers under the Consumer Protection Act 1986?                                                             2016
Ans: Procedure for filling complaint: The complainant or his authorised agent can present the complaint in person or send it by post to the appropriate forum or Commission, as the case may be, within a period of 2 years from the date on which the cause of action has arisen. No fee is charged for filing a complaint before the District Forum or the State Commission or the National Commission. A complaint should always be supported and verified by an affidavit.
The District Forum, State Commission and National Commission are required to decide complaints, as far as possible, within three months from date of notice received by the opposite parties. For those complaints which require laboratory analysis or testing of commodities, the period is extended to five months. The consumer has the right to file an appeal within 30 days with the next higher forum if he feels justice has not been done to him. If a consumer is not satisfied with the decision of national commission he can move to Supreme Court with the require fees within 30 days.
REMEDIES/PROTECTION UNDER THE ACT                             2017
In case it is proved that there exists a defect in the goods or that the services rendered were deficient in nature the following remedies against the seller are available to the Consumer.
a)      To remove the defect pointed out by the appropriate laboratory from the goods in question or;
b)      Replace the goods with new goods of similar description, which shall be free from any defect;
c)       Return to the complainant the price of the goods or the charges for the services rendered and / or;
d)      Pay such amount as compensation for any loss or injury suffered by the Consumer or;
e)      Remove the deficiency in the service and/ or;
f)       Discontinue the unfair or restrictive trade practice and not to repeat them and / or;
g)      Not to offer hazardous goods for sale and / or;
h)      Withdraw the hazardous goods for sale and / or;
i)        Provide adequate costs to the parties.
Q.N.4. Explain in brief rights and Responsibilities of consumers as provided under the Consumer Protection Act, 1986. 
Ans: Rights of Consumers:                           2012, 2017
a)      The right to safety: It refers to the right to be protected against products which are hazardous to health or life.
b)      The right to be informed: Consumers have a right to be informed about the quality, quantity and price of goods or services so that they can make the right decision.
c)       The right of choice: The consumer has the right to be assured of a choice of various goods and services of satisfactory quality and competitive price.
d)      Right to representation (or right to be heard): It is a right and the responsibility of civil society to ensure consumer interest prevails while formulating and executing policies which affect the consumers, as well as right to be heard while developing or producing a product or service.
e)      Right to seek redressal of grievances: The consumer has the right go to court against unfair or restrictive trade practices and receives compensation for supply of unsatisfactory goods or services.
f)       Others Rights: The right to consumer education, Right to basic needs, Right to healthy environment.
Main responsibilities of consumer are given as under:                  2012, 2015
a)      Be aware about their right: Consumer must be aware of their own rights.
b)      Quality conscious: while making purchase, consumer should look for quality certification.
c)       Must obtain cash memo: Consumer must insist on cash memos as cash memo act as proof of purchase.
d)      Be Assertive: The consumer must be assertive in his dealings.
e)      Be Honest: Consumer must act honestly and choose goods/services, which are legitimate.
Q.N.5. State any Five functions perform by Consumer organisation and Non-Government Organisation. 2013, 2015
Ans: Functions of Consumer organisation and Non-Government Organisations (NGO):
a)      Creating consumer awareness: They publish periodicals brochures journals etc for creating consumer awareness.
b)      Encourage the consumer: They encourage and educate the consumer to protect against exploitative, unfair trade practice of the seller.
c)       Filing complaints: They file suits, complaints, on behalf of consumer.
d)      Focus on consumer problem: They arrange seminars, workshops and conference for the purpose of focusing on problem of consumer.
e)      Problem legal assistance: They provide legal assistant for getting legal remedy against the damage caused to consumer.
Q.N.6. Explain the importance of consumer Protection act from the point of view of consumer?  2014
Ans:  Importance of Consumer Protection from the point of view of consumer:
a)      Consumer’s ignorance: Most of the consumers are ignorant about their light and relief’s available to them. So it was essential to create awareness among consumer for their lights.
b)      Unorganized consumers: Consumer are not much organized so us to protect their interest. Until their organization become strong and powerful, proper protection has to be provided.
c)       Wide Spread Exploitation of Consumer: the balance sheet man through various unfair trades. Practice like loading, black-marketing, adulteration etc.
Q.N.7. Explain the need/importance for consumer protection from the point of view of business.  2013, 2016
Ans: Importance of Consumer Protection from the point of view of business:
a)      Business is a means of human welfare: Business serves the customer. It is in the interest of both the consumer and the businessman to ensure that the business is run well because ignoring the interest of the consumer may be a sure death of the business.
b)      Growth with social justice: Growth with social justice is the prime feature of our economic philosophy. Exploitation of consumers is against the directive principles of State Policy laid down in our Indian Constitution.
c)       Single versus multiple objectives: Business works for all stakeholders – consumers, shareholders, employees, government, and the public. It is both a social and economic institution. Therefore it cannot just make profit by ignoring the interest of the society.
d)      Power Centre: Business has considerable influence over society and government. Therefore it has to set standards regarding food, dress habits, living styles, etc which will not damage the cause of society.
e)       Self interest: Due to liberalization and globalization, firms have to compete with multinationals. Unless they become customer oriented and provide right quality, quantity and price they cannot survive for long time and will be out beaten by competition from multinationals.
Q.N.10. Explain any five ways and means of consumer protection followed in India.
Ans: The following are some of the ways and means of consumer protection followed in India:
a)      Lok Adalats: The Consumer can approach the Adalats with his grievance. The issue is discussed and decision is taken on the spot. This saves time and money. Lok Adalats has become a speedy, effective and economical redressal system.
b)      Publicity Measures:  15th March is celebrated as World Consumer Right Day all over the world ever year. In 1995 this day was organized at Vigyan Bhawan, New Delhi. In addition, the Ministry with the help of DAVP undertook a massive outdoor publicity program such as displaying hoardings, banners, bus panels, etc.
c)       Environmentally Friendly Products: The Ministry of Environment and Forests has introduced an “Eco-Mark” scheme. It is a label that has a symbol of an earthen pitcher. If this label appears on a product, it means that the manufacturer has satisfied the conditions laid down regarding the production processes and used environmental friendly materials. This scheme has been started with consumer items like soap, detergents, paints, food items, edible oil, etc.
d)      Redressal Forums & Consumer Protection Councils: Under the Consumer Protection Act 1986 a judicial machinery such as the District Forums, State and National Commissions have been set up to provide speedy, effective and economical redressal of consumer grievances and disputes.
e)      National Youth Award on consumer protection: To encourage consumers and youths to participate in the field of consumer protection, every year the Union Ministry gives two national awards – National Award on Consumer Protection and National Youth Award on Consumer Protection.
f)       Consumer Awareness: It is not easy to exploit educated and well aware consumers. Consumer must be well aware about his rights, responsibilities and relief available to him.
g)      Government: Government of India has framed a set of laws and legislations to protect the interests of consumers and the most important act framed by Government is Consumer Protection Act, 1986. This act has provided three tier redressal agencies i.e. District Forum, State Commission and National Commission.
Q.N.8. What type of judicial machinery is there to deal with consumer grievances and disputes?
Ans: Government of India has framed a set of laws and legislations to protect the interests of consumers and the most important act framed by Government is Consumer Protection Act, 1986. This act has provided three tier redressal agencies i.e. District Forum, State Commission and National Commission.

District Forum
State Commission
National Commission
It consists of a president and two other members.
It consists of a president and two other members.
It consists of a president and four other members.
Who can be president
A working or retired judge of District Court.
A working or retired judge of High Court.
A working or retired judge of Supreme Court.
Where the value of goods or services is up to Rs. 20 Lakhs.
Where the value of goods or services is more than Rs.20 Lakhs and up to Rs 1 crores.
Where the value of goods or services is more than Rs. 1 crores