Consumer Protection Act, 1986

 Consumer Protection Act, 1986 provides for protection of consumer interests of consumers and contains provision for the establishment of consumer councils and other authorities for the settlement of consumers' grievances and disputes.

The act was enacted by Parliament in the Thirty-seventh Year of the Republic of India.

Salient features of Consumer Protection Act, 1986

Some of the important features if Consumer Protection Act, 1986 are:

1. It aims at providing overall/holistic protection to the consumers.

2. The act is applicable to entire, except for the state of Jammu and Kashmir.

3. The act is applicable to all goods and services, unless explicitly stated by the Central Government.

4. The act protects consumer against defective and hazardous goods, deficient and inappropriate services and unfair trade practices like hoarding, black marketing, insider trading, monopolies; etc.

5. The act provides redressal of consumer grievances in a simple and inexpensive way.

6. The most important aspect of the act is that it has a set time-frame for settlement.

7. Consumers having common interests and grievances can collectively file complaint, under ‘class action’ provided under the act. 8. The act cover both public and private sector suppliers of goods and services.

9. The act provides for formation of Consumer Protection Councils, which promote consumer protection under the consumer rights (Section 6, Consumer Protection Act, 1986). It is important that these councils do not have any legal authority under the act and merely facilitate addressal of consumer grievances.

10. The act has a comprehensive definition of services. The considers services of any description rendered/ offered by any individual or organisation, including public sector undertakings or government agency. This excludes free services and contracts of personal services. The following services also donot fall under the purview of the act:

(a) Civil amenities provided by municipal authorities.

(b) Medical services provided by government hospitals.

11. The at also provides for unfair trade practices like food adulteration, overcharging or short weighing on fixed price items and packaged commodities; etc. Such grievances can be directly taken to District Forums directly.

12. The act is considered as a progressive instance of social welfare legislation. The act has fortified consumer movement in India. The act is one of its kinds, as it pertains to market and seeks redressal of complaints arising out the market interactions.

13. The act is customer-oriented and safeguards the interests of the consumers against unjust and exploitative business practices like selling of defective goods, rendering poor services; etc. 

14. The act provides for a simple procedure for filing grievances. The complaint can be made in a simple form, where the name and address of aggrieved party and opposing party are duly mentioned. The complaint can be written in form of a letter to the Redressal Forum. It is not obligatory for the parties to engage advocate. The act allows the complainant or authorised agent to appear before the Redressal Forum.

Definitions of Expressions Used in the Act

Goods: The act defines 'goods' as every kind of movable property other than claims and money, and includes stocks, shares, crops, grass and other things attached to or forming part of land which are agreed to be served before sale or under contract of sales of Sales of Goods Act, 1930.

Services: The act has a comprehensive definition of services. The considers services of any description rendered/offered by any individual or organisation, including public sector undertakings or government agency.

This excludes free services and contracts of personal services. The following services also donot fall under the purview of the act:

• Civil amenities provided by municipal authorities
• Medical services provided by government hospitals

Services include 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.

Manufacturer: Section 2(1) of Consumer Protection Act defines manufacturer as:

• A person who manufactures goods or a part thereof.
• A person who assembles parts.
• A person who assembles parts.

Consumer:

• A person who buys any goods for a consideration – It includes a person who buys goods for a consideration or own use or for other user of such goods with the approval of the buyer. This excludes goods bought for resale or commercial use.
• A person who avails any service for a consideration–It includes beneficiary of services.

The consideration for goods and services may have been wholly or partly paid or promised in cash or under deferred system of payment.

Person: The act defines a person as:

• A firm (registered or unregistered).
• A Hindu undivided Family (HUF).
• Association of Person (AOP) [registered or unregistered under the Societies Registration Act].
• A Cooperative Society.

Trader: A person who sells, or distributes goods for selling is called a trader, and includes manufacturers and distributors. If the goods are sold/ distributed in packaged form, the term trader also includes the packer of such goods.

Consumer Dispute: Section 2(1)c of Consumer Protection Act defines consumer dispute as a dispute wherein the person against whom compliant has been filed or allegations have been made denies the same.

Defect: Section 2(1)c of Consumer Protection Act defines defect as a fault, shortcoming or imperfection in quality, potency, quantity, purity or standard of the product,

Deficiency: Deficiency corresponds to defects in case of goods. Section 2(1) g of Consumer Protection Act defines deficiency fault, shortcoming or imperfection in quality, manner of performance/ delivery, nature potency, quantity, purity or standard of the product.

National Commission: National Commission is Consumer Disputes Redressal Commission established by Central Government under Section 9(c) of Consumer Protection Act, 1986.

State Commission: State Commission is Consumer Disputes Redressal Commission established by State Government under Section 9(b) of Consumer Protection Act, 1986.

District forum: District forum is Consumer Disputes Redressal Forum, established by State Government under Section 9(a) of Consumer Protection Act, 1986, in each district of the state. If the state government deems it fit, it can establish more than one district forum in a district. 

Restrictive Trade Practices (RTP): Restrictive trade practices prevent, distort or restrict the buying, hiring or availing of goods or services by the consumers. The act defines restrictive trade practices as one which affect (distort, prevent or restrict) open competition in any manner and in particular:

• Practices who prevent capital or resource flow into the production.
• Practices which tend to tend to manipulate the prices or delivery conditions or free flow of supplies in the market relating to goods or services in a way that imposes unjustified costs or restrictions on consumers.

There are various types of restrictive trade practices under Section 33 of MRTP that are remittable with the director general. They are:

1. Refusal to Deal: This is an agreement under which there is restriction for the goods to be purchased or sold.

2. Tie-up Sales and full line forcing: This is called as tying arrangement. It is the agreement that requires a purchaser of goods as a precondition of the deal to purchase the other hoods.

3. Exclusive Dealing: This is any agreement that restricts the purchasers during trading to acquire or deal other goods other than from the seller or any other person.

4. Collective Agreement: This is an agreement where the buyers and sellers work jointly to make in huge gains.

5. Discriminatory Dealings: It is the practice of concession granting or benefit granting that also includes allowing of discounts or rebates on certain discriminatory basis.

6. Re-sale Price Maintenance: This is an agreement signed between the buyers and the sellers where the dealers are advised to sell the products either at a minimum price, or a maximum price as asked by the dealers.

7. Territorial Restrictions: This agreement restricts the supply of goods in any particular area.

8. Controlling Manufacturing Process: Under this agreement, there is a complete restriction of employment via any method, machinery or process during the manufacturing of goods.

9. Boycott: This is an agreement where the trader boycotts himself from the trade associations to share certain personal benefits.

10. Predatory Pricing: It is the agreement that asks the dealers to sell the goods at such a price that can eliminate competitors or the competition.

11. Restrictive on class of Suppliers from whom the Products are Purchased: Under this agreement, there is a restriction on number of whole sellers of dealers who are selling the goods.

12. Abstinence from Bids in Auction: This is an act where the concept of abstinence from bidding in auction is encouraged for certain personal benefits.

However, those that are exempted from being registered are:

1. Agreements taking place in J&K.

2. Agreements via undertakings that are exempted under section 3 falling under MRTP Act.

3. The restrictive trade practices that are must for safeguarding rights of patentees.

4. The restrictive trade practices that relate to production, supply or control of goods for exporting.

5. For an agreement, where there is dealing between buyer and seller for making personal gains by consuming the goods on their own.

6. Certain restrictive trade practices approved by central government and agreements to which the central government is also a party.

7. Certain agreements with no substantial economic significance.

Unfair Trade Practices (UTP): Section 36A of Consumer Protection Act, 1986 defines unfair trade practices are practices which for the purpose of sales, use o supply of goods or for the provisions of the services, adopt unfair methods, or deceptive practices. Some of the deceptive practices included under the definition are:

False Representation and Misleading Advertisement: The stated standards, quality, quantity, grade, model, style or composition in an advertisement are not in the actual product.

Product Non: compliance with safety standards

• Holding and destruction of goods to create artificial inflation
• Conducting promotional schemes or contests to offer gifts, discounts, free product, etc with an intention of not giving them
• Baiting
• Switch selling
• Bargain sales
• Unfair Trade Practices have been defined in both MRTP Act, 1969 and Consumer Protection Act, 1986.

No relief to Consumers in Case of Unfair and Restrictive Trade Practice

In case of Restrictive Trade Practices (RTP) and Unfair Trade Practices (UTP), the district forum may order the involved entities to do away from these or ask not to report such cases.

Person who can File a complaint under the Act

A person who can file a complaint under the under can be from any of the following categories:

• A consumer (who bought/received certain goods/services).
• Group of Consumers having Common Interest/ Grievances or complaints.
• Central Government.
• Any State Government.
• A Voluntary Consumer Association, registered under Companies Act, 1956 or other law in force.
• Consumer Protection Councils. 

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