Page 1
chapter
11
Learning Objectives
After studying this
chapter, you should be
able to:
¾ state the importance of
consumer protection;
¾ briefly explain legal
framework for consumer
protection in India;
¾ describe consumer
rights in India;
¾ briefly desc ribe the ways
and means of consumer
protection; and
Consumer Prote Ction Banks r esPonsiBle for f ailed
t ransaCtions and n o Cash in atm s In a landmark consumer forum judgement,
now, if you do not get money from ATMs, it
would be considered as deficiency of services
on part of bank,.On May 4, 2017, a petition in
the Consumer Forum in Raipur was filed where
the complainant submitted photos and video
recording of three failed ATM transactions due
to non-availability of cash bank’s ATMs.
In front of the forum, the bank argued
that ATM runs with Internet connectivity, so
at the time when users use ATM, he/she is
not directly the bank client. Hence, if the said
money not withdrawn from the ATM, then it
cannot be termed as a deficiency in service.
The forum rejected the bank’s logic
completely. The petitioner has presented
photo and video recording at the time of
withdrawal as evidence in front of forum.
Forum acknowledged that the consumers at
various times go to ATM to withdrawn money
every time the message of ‘cash not available’
is the lack in service.
The forum accepted the petition. After
hearing the arguments of both the parties, the
forum ordered that if the bank will not provide
ATM service to the customer, then it will be
considered a reduction in service Consumer
Forum imposed a fine of Rs. 2,500 on the bank
including Rs1,500 as compensation for mental
harassment and Rs1,000 for legal expenses
for non-availability of cash in its ATMs as
deficiency in bank services.
Source:http://dailypost.in/news/
consumer-forum-fines-sbi-ignoring-
customers/, 2017.
Ch_11.indd 289 10-08-2022 10:03:34
Rationalised 2023-24
Page 2
chapter
11
Learning Objectives
After studying this
chapter, you should be
able to:
¾ state the importance of
consumer protection;
¾ briefly explain legal
framework for consumer
protection in India;
¾ describe consumer
rights in India;
¾ briefly desc ribe the ways
and means of consumer
protection; and
Consumer Prote Ction Banks r esPonsiBle for f ailed
t ransaCtions and n o Cash in atm s In a landmark consumer forum judgement,
now, if you do not get money from ATMs, it
would be considered as deficiency of services
on part of bank,.On May 4, 2017, a petition in
the Consumer Forum in Raipur was filed where
the complainant submitted photos and video
recording of three failed ATM transactions due
to non-availability of cash bank’s ATMs.
In front of the forum, the bank argued
that ATM runs with Internet connectivity, so
at the time when users use ATM, he/she is
not directly the bank client. Hence, if the said
money not withdrawn from the ATM, then it
cannot be termed as a deficiency in service.
The forum rejected the bank’s logic
completely. The petitioner has presented
photo and video recording at the time of
withdrawal as evidence in front of forum.
Forum acknowledged that the consumers at
various times go to ATM to withdrawn money
every time the message of ‘cash not available’
is the lack in service.
The forum accepted the petition. After
hearing the arguments of both the parties, the
forum ordered that if the bank will not provide
ATM service to the customer, then it will be
considered a reduction in service Consumer
Forum imposed a fine of Rs. 2,500 on the bank
including Rs1,500 as compensation for mental
harassment and Rs1,000 for legal expenses
for non-availability of cash in its ATMs as
deficiency in bank services.
Source:http://dailypost.in/news/
consumer-forum-fines-sbi-ignoring-
customers/, 2017.
Ch_11.indd 289 10-08-2022 10:03:34
Rationalised 2023-24
BUSINESS STUDIES
290
IntroductIon Each one of us is a consumer in one
way or another. It is important for us
to be an aware and informed consumer
of goods and services available to us in
the market.The above case is just one
of the examples of the many problems
that consumers face in the purchase,
use and consumption of goods and
services. But, very few consumers
are aware of their rights given to
them by the Consumer Protection
Act 2019. The Consumer Protection
Act 20192019 has replaced the Act
1986 and seeks to widen its scope in
addressing consumer concerns.
Have you ever thought what
would be the plight of consumers if
adequate protection is not provided
to them? With growing competition
and in an attempt to increase
their sales and market share,
manufacturers, sellers and service-
providers may be tempted to engage
in unscrupulous, exploitative and
unfair trade practices like defective
and unsafe products, adulteration,
false and misleading advertising,
hoarding, black-marketing, etc.
This means that a consumer might
be exposed to risks due to unsafe
products, might suffer from bad
health due to adulterated food
products, might be cheated because
of misleading advertisements or sale
of spurious products, might have
to pay a higher price when sellers
engage in overpricing, hoarding or
black-marketing, etc. As a result,
consumer becomes unsafe, feels
cheated and is exposed to many risks
and health problems.
Can business afford to ignore the
interests of consumers? The market
forces have changed from a seller
market i.e., the earlier approach of
caveat emptor which means Let the
buyer beware, to a consumer market
i.e., caveat venditor which implies
Let the seller beware. A consumer
is said to be a KING in the free
market economy. Hence, consumer
protection has significance for both
consumers and business alike. Under
the Consumer Protection Act 2019, the
Government of India has conferred a
legal protection to safeguard interests
of a consumer.
Importance of c onsumer p rotectIon The concept of consumer protection
is to safeguard the interests of the
consumers. It adopts measures to
protect consumers from unethical
malpractices by businesses and
provide a swift redressal of their
grievances with regard to:
1. Sale of adulterated goods such as
adding inferior substances to the
product being sold.
2. Sale of counterfeit goods such as
selling a product of lesser value
than the real product.
3. Sale of sub-standard goods such
as the sale of products that do
not meet the prescribed quality
standards.
4. Sale of duplicate goods.
Ch_11.indd 290 10-08-2022 10:03:34
Rationalised 2023-24
Page 3
chapter
11
Learning Objectives
After studying this
chapter, you should be
able to:
¾ state the importance of
consumer protection;
¾ briefly explain legal
framework for consumer
protection in India;
¾ describe consumer
rights in India;
¾ briefly desc ribe the ways
and means of consumer
protection; and
Consumer Prote Ction Banks r esPonsiBle for f ailed
t ransaCtions and n o Cash in atm s In a landmark consumer forum judgement,
now, if you do not get money from ATMs, it
would be considered as deficiency of services
on part of bank,.On May 4, 2017, a petition in
the Consumer Forum in Raipur was filed where
the complainant submitted photos and video
recording of three failed ATM transactions due
to non-availability of cash bank’s ATMs.
In front of the forum, the bank argued
that ATM runs with Internet connectivity, so
at the time when users use ATM, he/she is
not directly the bank client. Hence, if the said
money not withdrawn from the ATM, then it
cannot be termed as a deficiency in service.
The forum rejected the bank’s logic
completely. The petitioner has presented
photo and video recording at the time of
withdrawal as evidence in front of forum.
Forum acknowledged that the consumers at
various times go to ATM to withdrawn money
every time the message of ‘cash not available’
is the lack in service.
The forum accepted the petition. After
hearing the arguments of both the parties, the
forum ordered that if the bank will not provide
ATM service to the customer, then it will be
considered a reduction in service Consumer
Forum imposed a fine of Rs. 2,500 on the bank
including Rs1,500 as compensation for mental
harassment and Rs1,000 for legal expenses
for non-availability of cash in its ATMs as
deficiency in bank services.
Source:http://dailypost.in/news/
consumer-forum-fines-sbi-ignoring-
customers/, 2017.
Ch_11.indd 289 10-08-2022 10:03:34
Rationalised 2023-24
BUSINESS STUDIES
290
IntroductIon Each one of us is a consumer in one
way or another. It is important for us
to be an aware and informed consumer
of goods and services available to us in
the market.The above case is just one
of the examples of the many problems
that consumers face in the purchase,
use and consumption of goods and
services. But, very few consumers
are aware of their rights given to
them by the Consumer Protection
Act 2019. The Consumer Protection
Act 20192019 has replaced the Act
1986 and seeks to widen its scope in
addressing consumer concerns.
Have you ever thought what
would be the plight of consumers if
adequate protection is not provided
to them? With growing competition
and in an attempt to increase
their sales and market share,
manufacturers, sellers and service-
providers may be tempted to engage
in unscrupulous, exploitative and
unfair trade practices like defective
and unsafe products, adulteration,
false and misleading advertising,
hoarding, black-marketing, etc.
This means that a consumer might
be exposed to risks due to unsafe
products, might suffer from bad
health due to adulterated food
products, might be cheated because
of misleading advertisements or sale
of spurious products, might have
to pay a higher price when sellers
engage in overpricing, hoarding or
black-marketing, etc. As a result,
consumer becomes unsafe, feels
cheated and is exposed to many risks
and health problems.
Can business afford to ignore the
interests of consumers? The market
forces have changed from a seller
market i.e., the earlier approach of
caveat emptor which means Let the
buyer beware, to a consumer market
i.e., caveat venditor which implies
Let the seller beware. A consumer
is said to be a KING in the free
market economy. Hence, consumer
protection has significance for both
consumers and business alike. Under
the Consumer Protection Act 2019, the
Government of India has conferred a
legal protection to safeguard interests
of a consumer.
Importance of c onsumer p rotectIon The concept of consumer protection
is to safeguard the interests of the
consumers. It adopts measures to
protect consumers from unethical
malpractices by businesses and
provide a swift redressal of their
grievances with regard to:
1. Sale of adulterated goods such as
adding inferior substances to the
product being sold.
2. Sale of counterfeit goods such as
selling a product of lesser value
than the real product.
3. Sale of sub-standard goods such
as the sale of products that do
not meet the prescribed quality
standards.
4. Sale of duplicate goods.
Ch_11.indd 290 10-08-2022 10:03:34
Rationalised 2023-24
c ONSUMER pROTEc TION
291
5. Use of malfunctioning weights and
measures that lead to underweight
of products.
6. Black marketing and hoarding that
eventually leads to scarcity of the
product and well as a rise in the
price of the same.
7. Overcharging a product, i.e.,
charging a product above its
Maximum Retail Price.
8. Supplying of defective goods.
9. Advertisements that are
misleading, i.e., advertisements
that falsely claim a product or a
service to be shown as superior
quality, grade or standard when
not in real.
10. Supply of inferior services, i.e.,
quality of service lesser than the
condition agreed.
That is why we as an informed consumer
have to wake up and save our self
need for consumer Protection
The need for consumer protection arises
from the need to protect consumers from
the loss or injury or other prevailing
malpractices and to ensure:
1. Physical safety of a consumer.
2. Access to information.
3. Corporate Social Responsibility
to provide quality and quantity of
goods at fair prices.
4. Consumer satisfaction.
5. Social justice and Trusteeship
6. Survival and the Growth of
businesses.
from various types of exploitation and
should complain about it. Consumer
protection has a wide scope. It not only
includes educating consumers about
their rights and responsibilities, but
also helps in getting their grievances
redressed. It not only requires a judicial
machinery for protecting the interests
of consumers but also requires the
consumers to be united and form
themselves into consumer associations
for protection and promotion of their
interests.
From consumers’ point of view
The importance of consumer protection
from the consumers’ point of view can
be understood from the following
points:
(i) Consumer Ignorance: In the
light of widespread ignorance
of consumers about their rights
and reliefs available to them, it
becomes necessary to educate
them about the same so as to
achieve consumer awareness.
(ii) Unorganised Consumers: Consumers need to be organised
in the form of consumer
organisations which would
take care of their interests.
Though, in India, we do have
consumer organisations which
are working in this direction,
adequate protection is required
to be given to consumers till
these organisations become
powerful enough to protect
and promote the interests of
consumers.
Ch_11.indd 291 10-08-2022 10:03:34
Rationalised 2023-24
Page 4
chapter
11
Learning Objectives
After studying this
chapter, you should be
able to:
¾ state the importance of
consumer protection;
¾ briefly explain legal
framework for consumer
protection in India;
¾ describe consumer
rights in India;
¾ briefly desc ribe the ways
and means of consumer
protection; and
Consumer Prote Ction Banks r esPonsiBle for f ailed
t ransaCtions and n o Cash in atm s In a landmark consumer forum judgement,
now, if you do not get money from ATMs, it
would be considered as deficiency of services
on part of bank,.On May 4, 2017, a petition in
the Consumer Forum in Raipur was filed where
the complainant submitted photos and video
recording of three failed ATM transactions due
to non-availability of cash bank’s ATMs.
In front of the forum, the bank argued
that ATM runs with Internet connectivity, so
at the time when users use ATM, he/she is
not directly the bank client. Hence, if the said
money not withdrawn from the ATM, then it
cannot be termed as a deficiency in service.
The forum rejected the bank’s logic
completely. The petitioner has presented
photo and video recording at the time of
withdrawal as evidence in front of forum.
Forum acknowledged that the consumers at
various times go to ATM to withdrawn money
every time the message of ‘cash not available’
is the lack in service.
The forum accepted the petition. After
hearing the arguments of both the parties, the
forum ordered that if the bank will not provide
ATM service to the customer, then it will be
considered a reduction in service Consumer
Forum imposed a fine of Rs. 2,500 on the bank
including Rs1,500 as compensation for mental
harassment and Rs1,000 for legal expenses
for non-availability of cash in its ATMs as
deficiency in bank services.
Source:http://dailypost.in/news/
consumer-forum-fines-sbi-ignoring-
customers/, 2017.
Ch_11.indd 289 10-08-2022 10:03:34
Rationalised 2023-24
BUSINESS STUDIES
290
IntroductIon Each one of us is a consumer in one
way or another. It is important for us
to be an aware and informed consumer
of goods and services available to us in
the market.The above case is just one
of the examples of the many problems
that consumers face in the purchase,
use and consumption of goods and
services. But, very few consumers
are aware of their rights given to
them by the Consumer Protection
Act 2019. The Consumer Protection
Act 20192019 has replaced the Act
1986 and seeks to widen its scope in
addressing consumer concerns.
Have you ever thought what
would be the plight of consumers if
adequate protection is not provided
to them? With growing competition
and in an attempt to increase
their sales and market share,
manufacturers, sellers and service-
providers may be tempted to engage
in unscrupulous, exploitative and
unfair trade practices like defective
and unsafe products, adulteration,
false and misleading advertising,
hoarding, black-marketing, etc.
This means that a consumer might
be exposed to risks due to unsafe
products, might suffer from bad
health due to adulterated food
products, might be cheated because
of misleading advertisements or sale
of spurious products, might have
to pay a higher price when sellers
engage in overpricing, hoarding or
black-marketing, etc. As a result,
consumer becomes unsafe, feels
cheated and is exposed to many risks
and health problems.
Can business afford to ignore the
interests of consumers? The market
forces have changed from a seller
market i.e., the earlier approach of
caveat emptor which means Let the
buyer beware, to a consumer market
i.e., caveat venditor which implies
Let the seller beware. A consumer
is said to be a KING in the free
market economy. Hence, consumer
protection has significance for both
consumers and business alike. Under
the Consumer Protection Act 2019, the
Government of India has conferred a
legal protection to safeguard interests
of a consumer.
Importance of c onsumer p rotectIon The concept of consumer protection
is to safeguard the interests of the
consumers. It adopts measures to
protect consumers from unethical
malpractices by businesses and
provide a swift redressal of their
grievances with regard to:
1. Sale of adulterated goods such as
adding inferior substances to the
product being sold.
2. Sale of counterfeit goods such as
selling a product of lesser value
than the real product.
3. Sale of sub-standard goods such
as the sale of products that do
not meet the prescribed quality
standards.
4. Sale of duplicate goods.
Ch_11.indd 290 10-08-2022 10:03:34
Rationalised 2023-24
c ONSUMER pROTEc TION
291
5. Use of malfunctioning weights and
measures that lead to underweight
of products.
6. Black marketing and hoarding that
eventually leads to scarcity of the
product and well as a rise in the
price of the same.
7. Overcharging a product, i.e.,
charging a product above its
Maximum Retail Price.
8. Supplying of defective goods.
9. Advertisements that are
misleading, i.e., advertisements
that falsely claim a product or a
service to be shown as superior
quality, grade or standard when
not in real.
10. Supply of inferior services, i.e.,
quality of service lesser than the
condition agreed.
That is why we as an informed consumer
have to wake up and save our self
need for consumer Protection
The need for consumer protection arises
from the need to protect consumers from
the loss or injury or other prevailing
malpractices and to ensure:
1. Physical safety of a consumer.
2. Access to information.
3. Corporate Social Responsibility
to provide quality and quantity of
goods at fair prices.
4. Consumer satisfaction.
5. Social justice and Trusteeship
6. Survival and the Growth of
businesses.
from various types of exploitation and
should complain about it. Consumer
protection has a wide scope. It not only
includes educating consumers about
their rights and responsibilities, but
also helps in getting their grievances
redressed. It not only requires a judicial
machinery for protecting the interests
of consumers but also requires the
consumers to be united and form
themselves into consumer associations
for protection and promotion of their
interests.
From consumers’ point of view
The importance of consumer protection
from the consumers’ point of view can
be understood from the following
points:
(i) Consumer Ignorance: In the
light of widespread ignorance
of consumers about their rights
and reliefs available to them, it
becomes necessary to educate
them about the same so as to
achieve consumer awareness.
(ii) Unorganised Consumers: Consumers need to be organised
in the form of consumer
organisations which would
take care of their interests.
Though, in India, we do have
consumer organisations which
are working in this direction,
adequate protection is required
to be given to consumers till
these organisations become
powerful enough to protect
and promote the interests of
consumers.
Ch_11.indd 291 10-08-2022 10:03:34
Rationalised 2023-24
BUSINESS STUDIES
292
Compensation for impurities in cold drinks
(iii) Widespread Exploitation of
Consumers: Consumers might
be exploited by unscrupulous,
exploitative and unfair trade
practices like defective and
unsafe products, adulteration,
false and misleading advertising,
hoarding, black- marketing,
etc. Consumers need protection
against such malpractices of the
sellers.
From the point of view of Business
A business must also lay emphasis
on protecting the consumers and
adequately satisfying them. This is
important because of the following
reasons:
(i) Long-term Interest of
Business: Enlightened
businesses realise that it is
in their long-term interest to
satisfy their customers. Satisfied
customers not only lead to
repeat sales but also provide
good feedback to prospective
customers and thus, help in
increasing the customer-base of
business. Thus, business firms
should aim at long-term profit
maximisation through customer
satisfaction.
Ch_11.indd 292 10-08-2022 10:03:34
Rationalised 2023-24
Page 5
chapter
11
Learning Objectives
After studying this
chapter, you should be
able to:
¾ state the importance of
consumer protection;
¾ briefly explain legal
framework for consumer
protection in India;
¾ describe consumer
rights in India;
¾ briefly desc ribe the ways
and means of consumer
protection; and
Consumer Prote Ction Banks r esPonsiBle for f ailed
t ransaCtions and n o Cash in atm s In a landmark consumer forum judgement,
now, if you do not get money from ATMs, it
would be considered as deficiency of services
on part of bank,.On May 4, 2017, a petition in
the Consumer Forum in Raipur was filed where
the complainant submitted photos and video
recording of three failed ATM transactions due
to non-availability of cash bank’s ATMs.
In front of the forum, the bank argued
that ATM runs with Internet connectivity, so
at the time when users use ATM, he/she is
not directly the bank client. Hence, if the said
money not withdrawn from the ATM, then it
cannot be termed as a deficiency in service.
The forum rejected the bank’s logic
completely. The petitioner has presented
photo and video recording at the time of
withdrawal as evidence in front of forum.
Forum acknowledged that the consumers at
various times go to ATM to withdrawn money
every time the message of ‘cash not available’
is the lack in service.
The forum accepted the petition. After
hearing the arguments of both the parties, the
forum ordered that if the bank will not provide
ATM service to the customer, then it will be
considered a reduction in service Consumer
Forum imposed a fine of Rs. 2,500 on the bank
including Rs1,500 as compensation for mental
harassment and Rs1,000 for legal expenses
for non-availability of cash in its ATMs as
deficiency in bank services.
Source:http://dailypost.in/news/
consumer-forum-fines-sbi-ignoring-
customers/, 2017.
Ch_11.indd 289 10-08-2022 10:03:34
Rationalised 2023-24
BUSINESS STUDIES
290
IntroductIon Each one of us is a consumer in one
way or another. It is important for us
to be an aware and informed consumer
of goods and services available to us in
the market.The above case is just one
of the examples of the many problems
that consumers face in the purchase,
use and consumption of goods and
services. But, very few consumers
are aware of their rights given to
them by the Consumer Protection
Act 2019. The Consumer Protection
Act 20192019 has replaced the Act
1986 and seeks to widen its scope in
addressing consumer concerns.
Have you ever thought what
would be the plight of consumers if
adequate protection is not provided
to them? With growing competition
and in an attempt to increase
their sales and market share,
manufacturers, sellers and service-
providers may be tempted to engage
in unscrupulous, exploitative and
unfair trade practices like defective
and unsafe products, adulteration,
false and misleading advertising,
hoarding, black-marketing, etc.
This means that a consumer might
be exposed to risks due to unsafe
products, might suffer from bad
health due to adulterated food
products, might be cheated because
of misleading advertisements or sale
of spurious products, might have
to pay a higher price when sellers
engage in overpricing, hoarding or
black-marketing, etc. As a result,
consumer becomes unsafe, feels
cheated and is exposed to many risks
and health problems.
Can business afford to ignore the
interests of consumers? The market
forces have changed from a seller
market i.e., the earlier approach of
caveat emptor which means Let the
buyer beware, to a consumer market
i.e., caveat venditor which implies
Let the seller beware. A consumer
is said to be a KING in the free
market economy. Hence, consumer
protection has significance for both
consumers and business alike. Under
the Consumer Protection Act 2019, the
Government of India has conferred a
legal protection to safeguard interests
of a consumer.
Importance of c onsumer p rotectIon The concept of consumer protection
is to safeguard the interests of the
consumers. It adopts measures to
protect consumers from unethical
malpractices by businesses and
provide a swift redressal of their
grievances with regard to:
1. Sale of adulterated goods such as
adding inferior substances to the
product being sold.
2. Sale of counterfeit goods such as
selling a product of lesser value
than the real product.
3. Sale of sub-standard goods such
as the sale of products that do
not meet the prescribed quality
standards.
4. Sale of duplicate goods.
Ch_11.indd 290 10-08-2022 10:03:34
Rationalised 2023-24
c ONSUMER pROTEc TION
291
5. Use of malfunctioning weights and
measures that lead to underweight
of products.
6. Black marketing and hoarding that
eventually leads to scarcity of the
product and well as a rise in the
price of the same.
7. Overcharging a product, i.e.,
charging a product above its
Maximum Retail Price.
8. Supplying of defective goods.
9. Advertisements that are
misleading, i.e., advertisements
that falsely claim a product or a
service to be shown as superior
quality, grade or standard when
not in real.
10. Supply of inferior services, i.e.,
quality of service lesser than the
condition agreed.
That is why we as an informed consumer
have to wake up and save our self
need for consumer Protection
The need for consumer protection arises
from the need to protect consumers from
the loss or injury or other prevailing
malpractices and to ensure:
1. Physical safety of a consumer.
2. Access to information.
3. Corporate Social Responsibility
to provide quality and quantity of
goods at fair prices.
4. Consumer satisfaction.
5. Social justice and Trusteeship
6. Survival and the Growth of
businesses.
from various types of exploitation and
should complain about it. Consumer
protection has a wide scope. It not only
includes educating consumers about
their rights and responsibilities, but
also helps in getting their grievances
redressed. It not only requires a judicial
machinery for protecting the interests
of consumers but also requires the
consumers to be united and form
themselves into consumer associations
for protection and promotion of their
interests.
From consumers’ point of view
The importance of consumer protection
from the consumers’ point of view can
be understood from the following
points:
(i) Consumer Ignorance: In the
light of widespread ignorance
of consumers about their rights
and reliefs available to them, it
becomes necessary to educate
them about the same so as to
achieve consumer awareness.
(ii) Unorganised Consumers: Consumers need to be organised
in the form of consumer
organisations which would
take care of their interests.
Though, in India, we do have
consumer organisations which
are working in this direction,
adequate protection is required
to be given to consumers till
these organisations become
powerful enough to protect
and promote the interests of
consumers.
Ch_11.indd 291 10-08-2022 10:03:34
Rationalised 2023-24
BUSINESS STUDIES
292
Compensation for impurities in cold drinks
(iii) Widespread Exploitation of
Consumers: Consumers might
be exploited by unscrupulous,
exploitative and unfair trade
practices like defective and
unsafe products, adulteration,
false and misleading advertising,
hoarding, black- marketing,
etc. Consumers need protection
against such malpractices of the
sellers.
From the point of view of Business
A business must also lay emphasis
on protecting the consumers and
adequately satisfying them. This is
important because of the following
reasons:
(i) Long-term Interest of
Business: Enlightened
businesses realise that it is
in their long-term interest to
satisfy their customers. Satisfied
customers not only lead to
repeat sales but also provide
good feedback to prospective
customers and thus, help in
increasing the customer-base of
business. Thus, business firms
should aim at long-term profit
maximisation through customer
satisfaction.
Ch_11.indd 292 10-08-2022 10:03:34
Rationalised 2023-24
c ONSUMER pROTEc TION
293
(ii) Business uses Society’s
Resources: Business
organisations use resources
which belong to the society.
They, thus, have a responsibility
to supply such products and
render such services which are
in public interest and would
not impair public confidence in
them.
(iii) Social Responsibility: A
business has social
responsibilities towards various
interest groups. Business
organisations make money by
selling goods and providing
services to consumers. Thus,
consumers form an important
group among the many stake-
holders of business and like
other stakeholders, their interest
has to be well taken care of.
(iv) Moral Justification: It is the
moral duty of any business to
take care of consumer’s interest
and avoid any form of their
exploitation. Thus, a business
must avoid unscrupulous,
exploitative and unfair trade
practices like defective and
unsafe products, adulteration,
false and misleading advertising,
hoarding, black marketing, etc.
(v) Government Intervention: A
business engaging in any form
of exploitative trade practices
would invite government
intervention or action. This
can impair and tarnish the
image of the company. Thus,
it is advisable that business
organisations voluntarily resort
to such practices where the
customers’ needs and interests
will well be taken care of.
t he c onsumer p rotect Ion a ct , 2019
The Consumer protection Act 2019
seeks to protect and promote the
consumers’ interest through speedy
and inexpensive redressal of their
grievances. It extends to the whole of
India. It is applicable to all types of
businesses whether a manufacturer
or a trader and whether supplying
goods or providing servicesincluding
e-commerce firms. The Act confers
certain rights to consumers with a view
to empowering them and to protect
their interests.
Who Is a c onsumer ?
A ‘consumer’ is generally understood
as a person who uses or consumes
goods or avails of any service. Under
the Consumer Protection Act 2019,
a consumer is a person who buys
any goods or avails services for a
consideration, which has been paid
or promised, or partly paid and partly
promised, or under any scheme of
deferred payment. It includes any
user of such goods or beneficiary of
services if such use is made with the
approval of the buyer. It applies to
both offline and online transactions
through electronic means or by
teleshopping or direct selling or
multilevel marketing. However, any
person who obtains goods or avails
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