Chapter 11 Consumer Protection
Chapter 11 Consumer Protection
Consumer Protection Text Book Questions and Answers
1. Select the correct alternative and write answer to the following questions :
1.When was the Consumer Protection Act passed?
(A) 1956
(B) 1932
(C) 1986
(D)2015
2. Who has introduced the principles of Trusteeship?
(A) Jawaharlal Nehru
(B) Subhash Chandra Bose
(C) Indira Gandhi
(D) Gandhiji
3. Out of the following, which has not been included in the Consumer Protection Act 1986, as consumers’ right?
(A) Protection
(B) Basic needs
(C) Awareness
(D) Choice
4. Which one of the following options is not included as Redressal Forum according to the Consumer Protection Act?
(A) LokAdalat
(B) District Level Forum
(C) State Level Commission
(D) National Level Commission
5. How many members exist in the District Level Forum?
(A) Total 3
(B) At least 3
(C) At least 5
(D) Total 5
6. Members of which commission are appointed by the Central Government?
(A) District Level
(B) State Level
(C) National Level
(D) International Level
7. In which court, can the public interest litigation be filed?
(A) Criminal Court
(B) Civil Court
(C) District Court
(D) Supreme Court
8. With which consumer protection organizational set-up is Ahmedabad connected?
(A) Consumer Education and Research Centre
(B) Consumer Guidance Society of India
(C) Consumer Unity and Trust Society
(D) Consumer Co-ordination Council
9. Which organization works towards compilation and co-ordination of the work of the various institutions working for consumer protection?
(A) Consumer Protection Council
(B) Consumer Protection and Research Council
(C) Consumer Co-ordination Council
(D) Consumer Unity and Trust Society
10. Which of the following is not done by consumer protection institutions?
(A) Educating the people regarding consumer rights
(B) Publish information which has consumer interest
(C) List of consumers given to the industries
(D) Protect the interest of consumers
2. Answer the following questions in one sentence each :
1.Who is the king of the market in a free market system?
Ans :-
In a free market system consumer is king of the market.
2.Under which heads can consumer exploitation be divided?
Ans :-
Consumer exploitation can be divided mainly into three heads:
(1) Physical and Mental exploitation
(2) Economic exploitation and Oxploitation
(3) Damage/loss of public interest
3.According to the principles of Trusteeship who is the important person in an organization?
Ans :-
According to the principle of Trusteeship, the consumer is the most important person visiting business premises.
4.Which two rights are favoured by the United Nations Organisation in its directive for the consumer?
Ans :-
Two right are favored by the United Nations Organization:
Hygienic environment.
(1) Primary needs and
(2) Hygiene environment
5.What proof should compulsorily be produced by the consumer to prove his purchase?
Ans :-
As a proof of purchase, consumer is compulsorily required to produce bill.
6.If the complainant is not satisfied by the judgement of District Level Forum, then to whom should he appeal for reconsideration and within what period?
Ans :-
If the complainant is not satisfied with the judgement of district level forum, then he has to make an appeal within 30 days for reconstruction before state level commission.
7.If the complainant is not satisfied by the judgement of State Level Commission, then to whom should he appeal for reconsideration and within what period?
Ans :-
If the party is not satisfied by the judgement of state level commission, then party can appeal to the National Level Commission for reconsideration within 30 days of order.
8.If the complainant is not satisfied with the judgement of the National Level Commission, then to whom should he appeal for reconsideration and within what period?
Ans :-
If the complainant is not satisfied with the judgement of the national level commission, then appeal can be made to the Supreme Court for reconsideration in due course of time.
9.In which courts can public interest litigation be filed?
Ans :-
The public interest litigation can be made to the high court of respective state or to supreme Court.
10.Give full forms of the following abbreviations :
(i)CERC :-Consumer Education and Research Centre
(ii)CPC :-Consumer Protection Council
(iii)VOICE:-Voluntary Organization in Interest of Consumer Education
(iv)CGSI:-Consumer Guidance Society of India
(v)CUTS:- Consumer Utility and Trust Society
(vi)CCC:- Consumer Co-ordination Council
(vii)NCH:-National Consumer Helpline
3. Answer the following questions in short :
1.What are the ways in which producers can exploit the consumers to increase their sales of goods and services?
Ans :-
->Under the circumstances of continuous increasing competition and desire to increase their share in total market, the manufacturers of goods and services are found making use of immoral, exploitative and improper methods.
->Because of such systems the consumers experience cheating. ->Through lot of ways and means higher price is charged from the consumers rather than charging fair and reasonable price.
->They are like; insecurity due of defective goods or services, hygiene of consumers being at stake due to adulteration, cheating caused by wrong and misleading advertisement, sale of duplicate products, unwanted price hike caused by hoarding of goods, by black-marketing of goods, etc
2.Explain about consumers’ exploitation.
Ans :-
->The exploitation of consumers can be predominantly categorized under three heads:
1. Physical and Mental Exploitation: Consumers are disappointed and angry when they are forced to purchase sub-standard quality products or duplicate ones. The inferior ingredients used in the product, leads to physical problems.
2. Economic Exploitation: Consumers are facing financial losses due to hoarding of goods, black marketing and charging higher price than the printed price.
3. Against Public Interest: Public interest is not safeguarded when some products are produced by using certain materials which can cause harm to environment
3.Write a note on the Principles of Trusteeship and Consumer Protection.
Ans :-
Physical and mental exploitation:
->If the consumer is fooled or forced to purchase a sub-standard quality or a duplicate product, then it leads to mental agony as well as physical loss.
->Getting disappointed, angry and frustrated and feeling cheated are forms of mental exploitation that the consumer faces whereas loss of money, adverse effect on human body by using the product, etc. are the form of physical loss or physical exploitation.
4.Explain consumer protection from the point of view of consumers.
Ans :-
Importance of Consumer Protection from the View Point of Consumer:
1. Extensive Exploitation of Consumers:
->It is widely seen that business units are trying to increase their profit by producing sub-standard, adulterated and duplicate products and resorting to misleading advertisement, black marketing, hoarding of goods and other unethical and exploitative polices.
->Such wrong and irrelevant policies adopted by business units have resulted in a need for consumer protection.
2. Ignorance of Consumers:
->Consumers are not aware about laws which empower them with rights or even if they are aware, they hesitate in taking legal steps or they have insufficient and misleading information.
->The prime importance is to spread awareness amongthe consumers regarding the laws which are in existence and the procedure therein.
3. Lack of Unity among Consumers:
->An individual a consumer always proves himself weak but if a large group of consumers unites and form a consumer protection forum, it becomes easy and effective to protect their interests.
->Such organizations have become active in India too.
->But till such organizations become strong, protection of consumers through law becomes essential.
5.How does Lok Adalat help in creation of consumer awareness?
Ans :-
Lok Adalat:
->Lok Adalat or People’s Court is India’s innovative contribution to the world for resolving cases quickly.
->The concept of Lok Adalat was started in Gujarat.
->It is an effective way to provide speedy and economical justice to the poor, weak and exploited section of the society.
->Generally, the Lok Adalats hear cases related to accident and its compensation, divorce, alimony, general debts, personal complaints, police complaints, etc.
->Lok Adalats consist of advocates, social workers, educationalists, reputed citizens, businessmen, police officers, insurance officers, judges and judicial officers.
->The Lok Adalats try to solve the cases amicably in such a way that both the parties get satisfied.
6.Write in brief about Public Interest Litigations (PIL).
Ans :-
Public Interest Litigation- PIL:
->Everyone is not capable enough to file complaints individually in a court either because of economic reasons or due to lack of time.
->There are certain aspects which affect an entire society rather than an individual or groups of individual.
->An affected person or a group or any common man of the society can write an application on a plain paper to the High Court of the concerned State or directly to the Supreme Court.
->If the court feels the application to be relevant, it can be converted into a case and after hearing the arguments of both the parties, judgment is given by the respective court.
4. Answer the following questions in brief :
1. State the importance of consumer protection from the viewpoint of business.
Ans :-
Importance of Consumer Protection:
->The list of the functions of consumer protection is broad and detailed.
->The functions are not limited to only spreading awareness regarding consumer’s rights and responsibilities but also solving the genuine complaints of consumers.
->To legally protect consumers is not the end of the work.
->Consumers also should unite for their goods and at various levels, consumer protection forum should be set-up.
->Business units sold understand the importance of the work of consumer protection.
->They can also maximize consumers’ welfare and protect them from malpractices earnestly.
Importance of Consumer Protection from the View Point of Business:
1. Use of Public Resources and Wealth:
->As every business is utilizing public resources and wealth continuously, it becomes their responsibility to promote social welfare by producing such goods and services which are useful to the society.
2. Social Responsibility:
->It is proven that business has social responsibility towards various stakeholders’ group.
->Business returns are based on sale which is made to the consumers.
->Consumers also are the main stakeholders among the various groups of stakeholders.
->Business units safeguard the interest of various other groups in the same way they should do so honestly for consumers also.
3. Part of the Society:
->Any business is a part of a society.
->Every seller is a customer of another seller.
->If consumer exploitation is inevitable then every person will have to experience exploitation.
->Hence, every seller should adopt such a policy which will increase the faith of the buyer and distance him from consumers’ exploitation.
4. Impression of the Society:
->Business impacts the habits of the people of society, their life styles, thoughts, living standards, food habits, fashions, clothing etc.
->Thus can be changed through advertisement.
->That is why business policy should be proper and good business ethics remains the moral responsibility of the businessmen.
5. Consumers’ Protection is good for Business:
->Business units have realised that consumer’s wellbeing is essential for the wellbeing of business.
->The basic requirement of a competitive market is to reach out to the consumers and produce goods according to consumers’ preferences.
->Those manufacturers who fail to understand this, will lose market to their competitors.
->Therefore, it is in the interest of the business that the producer realise that he should develop his business by protecting and understanding the preference of the consumers. E.g. Nokia
->A satisfied consumer just not purchase the product again, but also recommends the product to various groups of people in the society which will attract new consumers.
6. Principles of Trusteeship and Consumer Protection:
->According to Gandhiji’s principle of Trusteeship, whatever wealth the society has given to person should be used for the welfare of the people of the society.
->According to Gandhiji “Consumer is the most important person visiting the place of business.
->He is not dependent on the seller but we (sellers) are dependent on him.
->He does not interfere in our work but he is the objective of our business.
->He is not an outsider for our business but he is a part of our business.
->We do not favour him by providing a product of his choice but he does a favour by giving an opportunity to serve him.”
2.What are the rights made available to consumers as per the Consumer Protection Act?
Ans :-
Rights of Consumer:
->Every consumer should get his due rights so that he can get protection from exploitation.
->Consumer Protection Act gives six rights to consumers.
->The Consumer Protection which has been set up under the direction of Consumer Protection Law, encourages and protects the rights of consumers.
1. Safety:
->Every consumer is entitled to get protection from products which are harmful to health.
->For instance, sub-standard electrical appliances can cause dangerous injuries to the consumer and hence such appliances should not be used.
->Standardised and superior quality appliances should be used so that consumers can be protected.
2. Information:
->Consumer should get all information regarding the products like ike ingredients, manufacturing date, directions for use, price, quality, purity etc.
->For this, legally, a manufacture is bound to display all informations either, on the packing or on the label.
3. Choice:
->Every consumer has a right to choose and hence they have a right to choose either goods or services.
->He must get them at a competitive price, right quantity, right place and right time.
->This right to selection on part of the consumer has brought in market variety in goods and services by way of quality, brand, price, size etc. by the producers.
->E.g. In the two wheeler range, there are wide varieties to satisfy the requirement of the consumers and if one wants to purchase a motor cycle, he gets variety for selection with variations regarding engine, power, color, design, etc.
4. Representation:
->If a consumer is dissatisfied with a product or a service, he has the right to complain.
->Hence, most business units have set-up their own complaint redressal department.
->In India, many organizations which work for consumer protection help consumers to initiate the process of complaint.
5. Redressal:
->If a consumer gets sub-standard quality of goods or services as compared to what he has been promised to get then according, he should get relevant relief.
->Consumers are eligible for various types of relief under the Consumer Protection Act like replacement of goods or services or repair of the product or part.
->If there is any damage to the consumer a compensation is offered, Consumer has right to complaint and there is equal right for redressal.
6. Consumer Education:
->Every consumer has the right to know and also remained in formed throughout his life.
->Consumer should get right quality, quantity at the given time, place and at an ideal price.
->To get assurance for all these; the consumer has the right to get educated.
->If a product or a service is sub-standard as against the assured quality, he should know that he is entitled to legal relief.
->Most business units and organizations who work for consumer protection are actively working to educate consumers.
->Apart from this, the United Nations Organisation (UNO) has issued a directive recommending two more rights for the consumers.
(i) Basic Needs
(ii) Hygienic Environment.
(i) Basic Needs: Basic Needs refer to the requirement of goods and services for a decent living.
(ii) Hygienic Environment: Hygienic environment is a protection from various types of pollution so that an individual can lead a quality life. Every individual has the right to get pollution free air, water, food and land.
3.Define consumer and state who can complain to the dispute settlement institutions?
Ans :-
Meaning of consumer:
According to the Consumer Protection Act, a consumer is “A person who receives goods or services against an exchange, who pays or agrees to compensate partly or fully or promises to compensate on a future date or has participated in some future payment plan. Any user of the product or service who uses it on the basis of the permission of the purchaser is a consumer. But the one who purchases on a resale basis or for further production is not included under the definition of a consumer.”
Any of the following can complain to the dispute settlement institutions:
->Consumer himself
->Registered consumer union on behalf of consumer
->State government or central government on behalf of consumers
->Legal heirs or representatives of deceased consumers
4.How is consumer awareness created?
Ans :-
->The process of making consumers aware about their rights related to the products and services they buy is called consumer awareness.
->Today, many items having similar features but belonging to different brands are . available in the market.
->Illiterate, ignorant and unaware consumers who do not have complete knowledge or information about such things get fooled easily by buying fake or poor quality goods.
->There are several middlemen between producers and consumers and so the consumers get exploited in many ways.
->The system which sees that the goods and services the consumer buys are of good quality, proper weight and at a reasonable price is known as consumer protection.
->Consumer protection is a movement which is undertaken to make consumers aware about their rights.
->Consumer protection is a well-organized programme for the people of the society so that they become mature consumers. The programme aims at controlling anti-consumer activities, exploitation and deception that the consumers face.
->Every year, 15th March is celebrated as World Consumer Rights Day.
5. Answer the following questions in detail :
1.Explain the responsibilities of consumers according to Consumer Protection Act.
Ans :-
Meaning:
->We are all aware that without responsibilities, rights cannot be available.
->Every consumer should be conscious about the purchase of product or service, its use and after consumption responsibilities.
1. Conscious Use of Rights:
->Every consumer has number of rights which are legally available and the use of these rights require complete knowledge about it.
2. Beware of Misleading Advertisements:
->Very often sellers and producers, in order to promote sales, resort to wrong and misleading advertisements.
->E.g. Consumption of a specific product will increase the energy level in a person immediately or specific types of drink will increase the height of person in a short span.
->While taking a decision regarding purchase of a product, such misleading advertisement should be overlooked and the consumer should compare the product with other products.
->Inappropriate advertisements should be discontinued by drawing attention of the advertisers.
->If there are discrepancies between the informations provided in advertisements and the actual product, such discrepancies should be highlighted to the advertisers.
3. Care during Purchase:
->No producer or seller should provide false incentive for the sake of selling the product.
->Consumer should emphasize on getting all the necessary informations regarding the product or service in questions like name of manufacturing unit and address, quality, quantity, direction for use, expiry date, ingredients, manufacturing date,
weight, guarantee or warranty period and other conditions.
4.Solicit for a Bill:
->Whenever a consumer purchases a product or a service, he should ask for the bill from the seller. If the purchased product or service is damaged or of a sub-standard quality or does not fulfill the characteristics of a product and if the consumer wants to complaint to the Consumer Protection Forum, it is mandatory to submit the proof of purchase in the form of a bill.
->Every seller is bound legally to give a bill as a proof of his purchase.
5. Solicit a High Quality:
->Special emphasis should be laid for a permanent solution from sub-standard quality of product and service.
->Problem of adulteration, duplicate products etc. are common.
->While purchasing, care should be taken to confirm whether it has got quality control certificate and standardization mark.
6. Registration of Genuine Complaints:
->If there is any violation of consumer rights after the purchase of a product or a service, complaint should be registered by the consumer to the concerned authority.
->Very often consumers tend to ignore minor problems or violation of consumers rights which is not a correct approach.
->This trend encourages the seller to continue his exploitative tendencies. On the other hand, there are instances where consumers misuse their available rights and claim larger compensation for minor damages, which is also inappropriate.
7. Spread of Consumerism:
->Every consumer should take active part in the set-up of Consumer Protection activity in spreading awareness among consumers regarding their wellbeing and their rights.
8. Environmental Protection:
->Every consumer should contribute to environmental protection.
->After the use of goods, the wastes should be disposed without spreading dirt or pollution.
->This is the primary responsibility of the consumer.
9. No Involvement in Unethical Activities:
->When consumer is making purchase, he must follow legal matters.
->He should not involve himself in black marketing.
->Hoarding of goods or any such kind of unethical practices.
->Thus, for customers first condition is to fulfill all the responsibilities before he should insist for his legal rights.
2.Explain the 3 tier dispute settlement system according to the Consumer Protection Act.
Ans :-
->A three layer mechanism has been set up for complaint redressal of the consumers.
->These three levels are at the District Level, State Level and National Level.
->Generally, a consumer is the one who uses goods or services.
->If there is any defect in product, consumer can take the help of dispute settlement organization.
->He can register complaint individually or in the capacity of a representative of Consumer Association at the District, State or Central level as the case may be.
->If the grievances are common, the consumers can do so collectively too.
->If the consumer is dead his legal heirs or his representative can do so.
->The main objective of maintaining the three tier redressal system is to make it fast and economical.
(A)District Level Forum:
->This is the basic or primary level.
->At the district level, every State Government set up this forum. There are atleast three members appointed by the State Government, one as the President and there should be at least two more.
->The President should be legally qualified and experienced. –>Out of f these three, atleast one should be a woman member.
->If the price and compensation demanded for the disputed product or service is Rs. 20 lakhs or less, the redressal process can take place at the District Level Forum.
->After receiving the complaint, the District Level Forum sends it to the other concerned party by the district level forum.
->If needed, the district forum can send the product for the laboratory for testing.
->The district level forum listens to both the parties and if needed gets the product tested in the laboratory and based on the statement of the laboratory solves the dispute.
->If either of the parties is not happy with the judgment, then he can appeal at the State Level Commission for re-examination within 30 days of the judgment of District Level Forum.
(B) State Level Commission:
->It is the responsibility of the State Government to set up a State Level Commission.
->At least Three members including one as President should be appointed who should be legally qualified.
->There should be at least one woman member.
->If the price and compensation demanded for the disputed product or service is more than Rs 20 lakhs and equals to or less than Rs 1 crore, the redressal process can take place at the State Level Commission.
->Any consumer who has dissatisfaction over the judgment of the District Level Forum can apply to the State Level Commission within a period of 30 days.
->After receiving the complaint, the State Level Commission sends it to the accused.
->It listens to both the concerned parties, if needed it will send the product to the laboratory for testing.
->The consumer redressal will be taken on the basis of the presentation of both the parties and report of the laboratory.
->If any party is not satisfied with the State Level Commission, then within 30 days of the judgment of State Level Commission, it can appeal for re-examination with the National Level Commission.
(C) National Level Commission:
->The responsibility of setting up this commission lies with the Central Government.
->Along with one President, atleast four other members are appointed and thus there will be atleast five members.
->The President will be either existing or a retired judge of the Supreme Court.
->Out of the members appointed, atleast there will be one woman member.
->If the price and compensation demanded for the disputed product or service is more than Rs 1 crore, the National Level Commission can be approached.
->Any party who is not satisfied with the judgment of the State Level Commission will be handled by the National Level Commission.
->When a complaint is registered with the National Level commission, it will be sent to the Accused party.
->The National Level Commission listens to the arguments of both the parties and if it is needed will get the product tested in a laboratory and considers the report to the settle the dispute.
->If the judgment of the National Level Commission does not satisfy either of the parties, they can appeal for re-examination with the Supreme Court time.
3.What types of relief and compensation arc available to the consumer according to Consumer Protection Act?
Ans :-
If the consumer court accepts the complaints, it can allow one or more reliefs out of the following in the fovour of consumer:
(1) It can direct to remove the defects existing in the product or the service.
(2) It can direct to refund the money for the defects in the product or the service.
(3) It can order to exchange defective product with the new (fresh) product.
(4) If due to the negligence on part of the seller, there the consumer has to suffer any loss or injury; he can be compensated for the same.
(5) If the case so demands, penalty also can be imposed on the seller.
(6) Unfair and prohibitive business practices can be stopped and can order not to repeat the same in future.
(7) Production and sales of harmful products can be stopped.
(8) Harmful products can be stopped from being sold.
(9) If defective product or deficiency in service is found, atleast 5% of amount of total sales should be ordered to deposit in Consumer Protection Fund or to any institution or person working with the objective of utilising the amount for a specificpurpose.
(10) It can direct to remove misleading advertisements and introduce improvised advertisements.
(11) It can order to make reasonable payment to the affected party (Consumer) by way of compensation
4.Explain the working of Consumer Protection Institutions and Non-Government Organizations for protection and maintenance of consumers’ interest.
Ans :-
Role of Consumer Union and Non-Government Organizations (NGOs):
->In India, there are several consumer unions and Non-Government Organizations that are actively working for maintaining and protecting the interests of consumer.
->NGOs are non-profit organizations. They work for the welfare of the people on their own.
->NGOs have their own independent constitution. The workers follow this constitution and work accordingly for public welfare.
->Government does not interfere with the workings of NGOs.
NGOs that work specially for consumer welfare perform the following functions:
->Educating consumers about their rights through seminars, conferences and workshops.
->Publishing periodicals, notices, booklets, etc. to spread awareness regarding problems faced by consumers, for legal awareness, eligibility of compensation and other favourable information.
->Consumers are informed about the comparison of various products and services available in the market, quality analysis by the authorized laboratories and their reports.
->Support to provide legal information to the consumers and aid for the legal formality.
->Essential support is provided to the consumers to oppose unethical, exploitative and unfair sales practices of the sellers.
->Complaints are registered in the consumer court to protect the interest of the consumer.
->Provide complete assistance to consumers who want to complain in the Consumer Court.
->Consumer satisfaction and their related information are compiled and published.
->Releasing films and information for educating consumers.
->Consumer education programmes are organized in schools and colleges and students are educated for consumer protection.
->Awareness is created against food adulteration.
->Providing support to government institutions which work for spreading consumer awareness.
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