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 consumer’s 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
1
P. K. Majumdar: Law of Consumer Protection in India , 5 Th 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-udDin 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 Sultan’s 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-Din’s 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 articles8.The prices fixed for the Delhi market
were also applied in the provincial capitals and towns.
2
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.,
3
During the British regime (1765-1947)9, also known as the ‘Colonial Era’,
Government’s economic polices in India were concerned more with protecting
and promoting the British interests than with advancing the welfare of the
native population. The administration’s primary per-occupation 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 India’s independence was over by 15th 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.
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
9
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
Bhopal in 1984. Thus the Bhopal catastrophe, perhaps for the first time,
focused considerable attention on the industrialization hazards, environmental
pollution, Government responsibility and business 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
consumer’s 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 consumer’s 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)
Persons who have suffered loss or damage as a result of any unfair
trade practice adopted by any trader.
(ii)
Persons who have purchased goods for which the trader has 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)
Persons who have purchased goods for consideration which are
found suffer from one or more defects.
(iv)
Persons who have hired any services for consideration when 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 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
13
Lucknow Development Authority v. M.K. Gupta, (1994) 1 SCJ 103 at 110
Id at 110
15
id., at 110
14
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
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 Hon’ble
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 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 goods either for the purpose of resale or for
the purpose of being used in profit making activity 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.
16
AIR 2000 SC 3138.
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 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 seller’s 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 evils of
profiteering,
hoarding
and
black-marketing,
corruption,
nepotism,
irresponsiveness and arrogance towards 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.
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
17
Joel Dean. Managerial Economics, New Delhi: Prentice-Hall
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”
.
Be it enacted by Parliament in the Thirty-seventh Year of the Republic of 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
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
;
(ii) Recognized by a State Government, subject to such guidelines as may
be
prescribed
by
the
Central
Government
in
this
behalf;
or
(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;]
18
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).
19
Substituted by Act 50 of 1993, sec. 2 for clause (a) w.e.f. 18-6-1993.
(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
having the same interest;]
21[(v)
in case of death of a consumer, his legal heir or 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;
(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;
20
Ins. by Act 62 of 2002, sec.2 (w.e.f. 15-3-2003).
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).
Subs. by Act 50 of 1993, sec. 2, for "the services mentioned in the complaint" (w.e.f. 18-61993).23
24 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).
21
22
(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 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
27[Explanation.
for
any
commercial
purpose];
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
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
27
Subs. By Act 50 of 1993, sec.2, for "hires" (w.r.e.f. 18-6-1993).
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. 153-2003).
28
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
29[*
* *] in each
district of the State by notification:
30[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.
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,
The words 'with prior approval of the Central Government" Omitted by Act 50 of 1993. Sec. 7
(w. r. e. f. 18th June 1993).
29
30
31
Ins. by Act 50 of 1993. Sec. 7 (w. r. e. f. 18th June 1993).
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
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)
the
Every appointment under sub-section (1) shall be made by
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.]
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:
33
Inserted by Act 50 of 1993, sec.8 (w.e.f. 18-6-1993).
34
Inserted by Act 62 of 2002, sec.6 (w. e. f. 15-3-2003).
35
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 subsection (1) in relation to the category of the member who has resigned." (w. e. f. 15-3-2003).
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 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
rupees twenty lakhs]
36[does
not exceed
.
(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,
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. 15-32003)
36
actually and voluntarily resides or
37[carries
on business or has a
branch office, or] personally works for gain;
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[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
39[carry
gain,
on business or have a branch office], or personally works for
as
the
case
may
be,
acquiesce
in
such
institution;
or
(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 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
or
not;
or
(c) one or more consumers, where there are 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:
37
Subs. by Act 50 of 1993, sec.9 for "carries on business or" (w. r. e. f. 18-6-1993).
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.]
3813.
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 days as
may be granted by the District Forum
;
(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
38
Subs. by Act 62 of 2002, sec. 9, for "Procedure on receipt of a complaint" (w. e. f. 15-3-2003).
39
Subs. by Act 62 of 2002, sec. 9, for "on receipt of a complaint" (w. e. f. 15-3-2003).
days of the receipt of the reference or within such extended period as
may be granted by the District Forum
;
(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
;
(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
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).
40
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
41(3)
his
case
within
the
time
given
by
the
Forum.
No proceedings complying with the procedure laid down in sub-
sections (1) and (2) shall be called in question in any court on the 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
:-
(i) the summoning and enforcing attendance of any defendant 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(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.
41
Subs. by Act 62 of 2002, sec. 9, for "complaint received" (w. e. f. 15-3-2003).
42
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).
43
44
Ins. by Act 50 of 1993, sec. 11 (w. e. f. 18-6-1993).
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
following
things,
45(do)
one or more of the
namely
:
(a) to remove the defect pointed out by the appropriate laboratory
from the goods in question
;
(b) to replace the goods with new goods of similar description which
shall be free from any defect
;
(c) to return to the complainant the price, or, as the case may be, the
charges paid by the complainant
;
(d) to pay such amount as may be awarded by it as 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
;
(h) to withdraw the hazardous goods from being offered for sale;
(i) to provide
47(2)
Every proceeding referred to in sub-section (1) shall be conducted by
the President of the District Forum and at least one member thereof
sitting
together
:
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
45
Subs. for “take” by the Consumer (Amendment ) Act, 1993 (w.e.f. 18-6-1993)
46
Ins. by the Consumer Protection (Amendment)Act of 1993, (w. e. f. 18-6-1993).
47
Subs. by Act 34 of 1991, sec.2, for sub-section (2) (w. r. e. f. 15-6-1991).
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
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
the
State
48(Provided
after
Government,
who
shall
be
its
President
:
that no appointment under this clause shall be made except
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
shall
be
49(Provided
a
woman
:
that every appointment made under this clause shall be 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
,
(iii) Secretary, incharge of Department dealing with consumer affairs in
the State – Member)
.
(2) The salary or honorarium and other allowances payable to, and the
other terms and conditions of service
48
50(***)
of the members of the State
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).
50
The words "(including tenure of office)" omitted by Act 50 of 1993, sec. 13 (w. e. f. 18-6-1993).
Commission shall be such as may be prescribed by the State
Government.
51(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.
(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.
5217.
JURISDICTION OF THE STATE COMMISSION
.
Subject to the other provisions of this Act, the State Commission shall
have jurisdiction
-
(a) to entertain
-
(i) complaints where the value of the goods or services and compensation,
if any, claimed exceeds rupees
53(twenty
lakhs but does not exceed
rupees ONE CRORE and
:
(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
:
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. 15-3-2003).
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).
53
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
sufficient
54[
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 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
in
writing
by
such
Commission:
Provided Further that the State Commission or the National 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
after consultation with the Chief Justice of India
2[(b)
;]
not less than four, and not more than such number of members,
as may be prescribed, and one of whom shall be a woman, who shall
have the following qualifications, namely:54
Ins. by Act 62 of 2002, Sec. 16 (w.e.f. 15-3-2003).
55
Ins. by Act 62 of 2002, Sec. 17 (w.e.f. 15-3-2003).
(i) be not less than thirty-five years of age
;
(ii) possess a bachelor's degree from a recognized university; and
(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 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
district
level
court
or
any
tribunal
at
equivalent
level:
Provided further that a person shall be disqualified for appointment, if
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(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
56
Subs. by Act 62 of 2002, Sec. 19 for "rupees twenty lakhs" (w. e. f. 15-3-2003).
that such State Commission has exercised a jurisdiction not vested in it
by law, or has failed to exercise a jurisdiction so vested, or has acted in
the exercise of its jurisdiction illegally or with material irregularity.
5722.
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-sections (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 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
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).
Commission shall, if no appeal has been preferred against such order
under the provisions of this Act, be final
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 three-tier
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
59
Ins. by Act 50 of 1993, Sec. 19 (w. r. e. f. 18-6-1993).
establishment60 and then with the smooth functioning of these
mechanisms61.
(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-à-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 Ethics’62. 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,
Common cause v.Union of India &Ors., 1991(2)CPR523(SC)
Gurjeet Singh(1996): The Law of Consumer Protection in India:Justic With Reach, New
Delhi: Deep & Deep Publication.
62
‘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).
60
61
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, these Forums
still lack basic infrastructural facilities. The members sit only parttime and 90 days decision-making 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,
posts
and
telegraphs
and
telecommunications had presumably given these services an 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
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
63
their rights, much less of being assertive about them64. Though the
Government appears to be serious of this issue65, 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.
64
65
Pushpa Girimaji (1993): “Most Consumers Ignorant of Rights.” In : The Tribune (22 Oct.) ; p 12
“Government Aim Protection of Consumers.” In The Tribune (14 th Dec.) p 7