Consumer Protection: An Overview Video Lecture | Business Studies (BST) Class 12 - Commerce

consumer protection and overview we are
aware that manufacturers and service
providers offer products and services to
fulfill needs and wants of consumers on
the one hand and to increase their level
of profit sales and market share on the
other however in an attempt to increase
their sales and market share these
producers may be tempted to engage in
unfair trade practices like defective
and unsafe products adulteration false
and misleading advertising like
marketing just to name a few
hence there is a need to provide
adequate protection to consumers again
such practices of the sellers according
to the Cambridge Advanced Learning
dictionary consumer protection is the
protection of buyers of goods and
services against low-quality or
dangerous products and advertisements
that deceive people consumer protection
includes educating consumers about their
rights and responsibilities and helping
them to seek redress of their grievances
importance of consumer protection from
consumers point of view the importance
of consumer protection from the
consumers point of view can be
understood from the following points
one consumer ignorance majority of the
consumers are ignorant about the rights
and reliefs available to them hence it
becomes necessary to educate them about
the same to achieve consumer awareness
to unorganized consumers consumers need
to get together and form themselves into
powerful consumer organizations to
protect and promote their own interests
three widespread exploitation of
consumers consumer protection plays a
vital role as 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
importance of consumer protection from
the point of view of business it is also
important for business units to protect
consumers and adequately satisfying them
due to the following reasons
one long-term interest of business
business firms should aim at long term
profit maximization through customer
satisfaction customer satisfaction not
only leads to repeat sales but also
increase the customer base of
business-to-business uses society's
resources business organizations use
resources which belong to the society
hence it is a responsibility of business
firms to offer those products and
services that are in public interest
three social responsibility business
organizations make money by selling
goods and providing services to
consumers
hence consumers form an important group
of stakeholders and business
organizations should take care of the
group for moral justification it is the
moral duty of any business organization
to take care of consumers interest and
avoid any form of their exploitation
five government intervention a business
firm should take care of consumers needs
and interests as its involvement in any
form of exploitative trade practices
would invite government intervention or
action such government intervention may
damage the image and position of the
company in the society
legal protection to consumers in order
to provide adequate protection to
consumers the Government of India has
enacted a number of regulations let us
understand some of these regulations one
the Consumer Protection Act 1986 the Act
provides safeguards to consumers against
different forms of exploitation such as
defective goods deficient services
unfair trade practices and so on the Act
also make provisions for establishment
of consumer councils and other
authorities for the settlement of
consumer disputes and matter therewith
connected to the contract Act 1982 this
act lays down the conditions in which
the promises made by parties to a
contract will be binding on each other
the Act also specifies the remedies
available to parties in case of breach
of contract 3 the Sale of Goods Act 1930
this act provides some safeguards and
reliefs to the buyers of the codes if
the goods purchased to not comply with
implied conditions or warranties for the
essential commodities Act 1955 this act
was enacted to ensure the easy
availability of essential commodities to
consumers and to protect them from
exploitation by profit ears
hoarders and black marketers the Act
provides for the regulation and control
of production distribution and pricing
of essential commodities
five the agricultural produce grading
and marking act 1937 this act prescribes
great standards for agricultural
commodities and allied commodities these
are known as AG mark standards an
acronym for agricultural marketing the
Act lays down the procedure for grading
marking and packing of agricultural
produce six the prevention of food
adulteration Act in 1954 the Act aims to
protect the consumers from poisonous and
harmful foods and prevent the sale of
substandard foods in order to maintain
Public Health seven the standards of
weights and measures act 1976 the
provisions of this act are applicable in
case of those goods which are sold or
distributed by weight a measure or
number the Act aims at ensuring that
consumers get products with right weight
and measurements
eight the trade marks act 1999 this act
has replaced the trade and merchandise
marks act 1958 the Act provides
protection to consumers by preventing
the use of fraudulent marks on products
9 the Competition Act 2002 this act has
replaced the monopolies and restrictive
trade Practices Act 1969 the Act
provides protection to consumers by
refraining traders to promote any
activity which hampers competition in
the market 10 the Bureau of Indian
Standards Act 1986 this Act provides for
the establishment of the Bureau of
Indian Standards for the harmonious
development of the activities of
standardization marking and quality
certification of goods this Act
permitted manufacturers to use the ISI
mark on their products after ensuring
that the goods conform to the prescribed
quality standards the bureau has also
set up a grievance cell where consumers
can make a complaint about the quality
of products carrying the ISI mark ways
and means of consumer protection there
are various ways of protecting the
interests of consumers one
self-regulation by business
the business organization themselves can
promote consumer protection by
regulating their own behavior and
actions socially responsible firms
follow ethical standards and practices
in dealing with their customers firms
establish customer service and grievance
cells to redress the problems and
grievances of their consumers to
business associations the associations
of trade commerce and business like
Federation of Indian Chambers of
Commerce of India or fi CCI and
Confederation of Indian Industries or
CII can check unfair trade practices
used by some business organizations
through their code of conduct three
consumer awareness in order to protect
his interests a consumer should know the
rights and the reliefs available to him
for consumer organizations consumer
organizations awaken consumers by
educating them about their rights these
organizations provide protection to
consumers by taking organized action and
forcing business firms to adopt fair
trade practices five government the
government can protect consumers
interests through legislative executive
and judicial actions the executive
should strictly enforce the laws passed
by the government Government of India
encompasses several legislations to
protect the interests and rights of
consumers redressal agencies under the
Consumer Protection Act in order to
resolve consumer disputes the Consumer
Protection Act 1986 provides for the
establishment of a three-tier
enforcement machinery at the national
state and district levels these are the
national consumer disputes redressal
Commission national Commission the state
consumer disputes redressal Commission
state Commission the district consumer
disputes redressal forum district forum
respectively
the objectives of these councils are to
help the respective governments in
adopting and reviewing policies for
promoting and protecting consumers
rights let us now understand how the
consumer grievances are redressed by the
three-tier machinery under the consumer
protection act District forum under the
consumer protection act the state
government has to set up a district
forum in each district of the state each
district forum consists of a president
who's qualified to be a district judge
and two other members one of whom should
be a woman they are appointed by the
state government concerned the district
forum has the jurisdiction to deal with
all complaints where the value of the
goods or services and the compensation
claimed is less than 20 lakh rupees
state commission like the district forum
the state commissions are set up by the
respective state government in the state
each state commission consists of a
president who is or has been a charge of
a high court and two other members one
of whom should be a woman they are
appointed by the state government
concerned
the state Commission's are in part to
deal with cases where the value or
amount involved exceeds 20 lakh rupees
but does not exceed one crore rupees the
state Commission's also deal with
appeals against the orders of any
district forum in the state national
Commission the National Commission is
set up by the central government the
National Commission consists of a
president who is or has been a judge of
the Supreme Court and four other members
one of whom should be a woman they are
appointed by the central government the
National Commission have jurisdiction to
take up all claims and grievances
exceeding the value of 1 crore rupees
the Commission also has power to
entertain appeals against the orders of
any state Commission the National
Commission state commissions and
district forums need to decide
complaints within a period of three
months from the date of notice received
by consumers if a complain does not
require analysis or testing of
commodities and within 5 months if it
requires analysis or testing of
commodities on the receipt of a
complaint a copy of the complaint is to
be referred to the trader
against whom the complaint is filed the
goods are a sample may be sent for
testing in a laboratory if required
then the complaint will be decided after
considering the test report from the
laboratory and hearing the trader an
order passed by a district forum is
appealable before the concerned state
commission by a state commission is
appealable before the national
commission and by a national commission
is appealable before the Supreme Court
within a period of 30 days on finding a
consumers complaint genuine a consumer
Court may ask a trader against whom the
complaint is filed to remove the defect
in goods or deficiency in service to
replace the defective product with a new
one free from any defect to refund the
price or charges paid for a product or a
service respectively
to pay a reasonable amount of
compensation for any loss or injuries
suffered by the consumer due to the
negligence of the trader or dealer to
pay compensation in excess of actual
damage in appropriate circumstances to
discontinue the unfair restrictive trade
practice and not to repeat it in future
to cease manufacturing of hazardous
Goods and withdraw the same from sale to
pay any amount not less than five
percent of the value of the defective
goods or deficient services provided to
be credited to the consumer welfare fund
or any other organization or person to
be utilized in the prescribed manner and
to issue corrective advertisement to
neutralize the effect of a misleading
advertisement
in a nutshell consumer protection refers
to activities of government business and
independent organizations designed to
protect consumers from unfair trade
practices like defective and unsafe
products adulteration false and
misleading advertising black marketing
just to name a few the Indian legal
framework consists of a number of
regulations which provide protection to
consumers
these include one the Consumer
Protection Act 1986 to the contract Act
1982 three the Sale of Goods Act 1934
the essential commodities act in 1955 5
the agricultural produce grading and
marking act 1937 6 the Prevention of
food adulteration act 1954 7 the
standards of weights and measures act
1976 8 the trade marks act 1999 9 the
Competition Act 2002 10 the Bureau of
Indian Standards Act 1986
the various ways in which the objective
of consumer protection can be achieved
are one self-regulation by business to
business associations three consumer
awareness for consumer organizations
five government the Consumer Protection
Act 1986 mandates establishment of quasi
judicial bodies in each district and
state and at the national level to
provide inexpensive and speedy redressal
of consumer disputes these are known as
the district forums the state consumer
disputes redressal commissions and the
national consumer disputes to address a
commission respectively