Consumer Protection NCERT Solutions | Business Studies (BST) Class 12 - Commerce PDF Download

State whether the following statements are true or false.

1. Consumer protection has a moral justification for business.
 Answer True

2. In addition to rights, a consumer also has some responsibilities.
 Answer True

3. A complaint can to be made to a district forum when the value of the goods or
 services in question, along with the compensation claimed, exceeds ₹ 20 lakhs.
 Answer False
In district forum complaint can be made when goods or services, along with the
compensation claimed, does not exceed ₹ 20 lakhs.

4. The Consumer Protection Act provides for six consumer rights.
 Answer True

5. lSI is the quality certificate mark used in case of food products.
 Answer False
lSI is certification mark on electrical goods and FPO mark on food products

6. Under the Consumer Protection Act, a compliant can be filed by a consumer for a
 defective good also for deficiency in service.
 Answer True

Very Short Answer Type Questions

Question 1. Under which consumer right does a business firm set up consumer grievance cell? 

Answer A business firm sets up a consumer grievance cell under the consumer right to seek redressal.

Question 2. Which quality certification mark is used for agricultural products? 

Answer "AGMARK" certification ensures agricultural product quality and conformity to Indian government standards.

Question 3. What is the jurisdiction of cases that can be filed in a State Commission? 

Answer A complaint can be made to the appropriate state commission when the value
of the goods and services, along with compensation claim exceeds ₹ 20 lakhs but does
not exceed ₹ 1 crore. The appeals against the orders of a District Forum can also be
filed before the state commission.

Question 4. State any two relief available to consumers under CPA. 

Answer Reliefs under CPA include compensation for damages suffered and the replacement or repair of defective goods or deficient services.

Question 5. Name the component of product mix that helps the consumer to exercise the right to information. 

Answer The labeling component of the product mix helps consumers exercise the right to information by providing details about the product.

Short Answer Type Questions

Question 1. Enumerate the various Acts passed by the Government of India which help
 in protecting the consumer’s interest?
 Answer The Indian legal framework consists of a number of regulations which provide
protection to consumers. Some of these regulations are as under

1. The Consumer Protection Act, 1986 The Act provides safeguards to
Consumers against defective goods, deficient services, unfair trade practices etc.

2. The Contract Act, 1982 The Act lays down the conditions in which the promises
made by parties to a contract will be binding on each other.

3. The Sale of Goods Act, 1930 The Act provides some safeguards and reliefs to the
buyers of the goods in case, the goods purchased do not comply with express or
implied conditions or warranties.

4. Essential Commodities Act, 1955 The Act alms at controltinq, production, supply,
distribution and price of essential commodities.

5. The Agricultural Produce Act, 1937 The Act prescribes grade standards for
agricultural commodities and livestock products.

6. The Prevention of Food Adulteration Act, 1954 The Act aims to check adulteration
of foods articles and ensure their purity, so as to maintain public health.

7. The Standards of Weights and Measures Act, 1976 It provides protection to
consumers against the malpractice of under-weight or under-measure.

8. The Trade Marks Act, 1999 The Act prevents the use of fraudulent marks on
products and thus provides protection to the consumers against such products.

9. The Competition Act, 2002 The Act provides protection to the consumers In case
01 practices adopted by business firms which hamper competition in the market.

10. The Bureau of Indian Standard Act, 1986 The bureau has two major
activities: formulation of quality standards for goods and their certification through
the BIS certification scheme. The bureau has also set up a grievance cell, where
consumers can make a complaint about quality of products carrying the lSI mark.

Question 2. What are the responsibilities of a consumer?

Answer A consumer should keep in mind the following responsibilities while
purchasing, using and consuming goods and services
1. Be aware about various goods and services available in the market, so that an
intelligent and wise choice can be made.
2. Buy only standardised goods as they provide quality assurance. Thus, look for lSI
mark on electrical goods. FPO mark on food products and Hallmark on jewellary
etc.
3. Learn about the risks associated with products and services.
4. Read labels carefully, so as to have information about prices, weight,
manufacturing and expiry dates etc.
5. Assert yourself to get a fair deal.
6. Be honest In your dealings. Choose only from legal goods and services.
7. Ask for a cash-memo on purchase of goods and services. This would serve as a
proof of the purchase made.
8. File a complaint in an appropriate consumer forum in case of a shortcoming in the
quality of goods purchased or services availed.
9. Form consumer societies which would play an active part in educating consumers
and safeguarding their interests
10. Respect the environment, avoid waste, littering and contributing to pollution.

Question 3. Who can file a complaint in a consumer court?
 Answer A complaint can be made by
1. Any consumer.
2. Any registered consumer’s association.
3. The Central Government or any State Government.
4. One or more consumers. on behalf of numerous consumers having the same
Interest.
5. A legal heir or representative of a deceased consumer.

Question 4. FSSAI (Food Safety and Standards Authority of India) has made a proposal for hotels and other food outlets to declare the kind of oil/fat used in cooking each of the food items on their menus. Name and explain the Consumer Right being reinforced by this proposal. 

Answer The proposal made by FSSAI reinforces the consumer right to information. This right ensures that consumers have access to accurate, clear, and transparent information about the products they purchase or consume. By requiring hotels and food outlets to declare the kind of oil or fat used in cooking each food item on their menus, consumers can make informed choices based on their dietary preferences, allergies, or health considerations.

This initiative empowers consumers to make healthier choices by being aware of the types of oils or fats used in the preparation of their food. For example, individuals who are conscious about their cholesterol levels can opt for dishes cooked in healthier oils, while those with allergies or dietary restrictions can avoid foods prepared with certain types of fats.

Overall, by providing such information, the proposal enhances consumer awareness and enables them to make decisions aligned with their preferences and health goals, thereby promoting their right to information and ensuring their well-being.

Question 5.  Who is a consumer as per CPA? 

Answer According to the Consumer Protection Act (CPA), a consumer is defined as any person who:

1. Buys any goods for a consideration that 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

2. Hires or avails of any services for a consideration that 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 than 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.

Long Answer Type Questions

Question 1. Explain the importance of consumer protection from the point of view of business.
 Answer A business can not survive without paying attention on protecting – the
consumers interest and adequately satisfying them. This is important because of the
following reasons

1. Long Term Interest of Business BUSiness firms should aim at long term profit
maximisation through customer satisfaction. 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.

2. Business uses Society’s Resources Business organisation uses resources which
belong to the society, thus they have a responsibility to supply such products and
render such services which are in public interest.

3. Social Responsibility A business has social resposibility 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 stakeholders of business and like other stakeholders, their interest has to be
well taken care of.

4. Moral Justification The moral duty of any business is to take care of consumer’s
interest and securing them from exploitation. Thus, a business must avoid
insecure loss, exploitation and unfair trade practices like defective and unsafe
products. adulteration. false and misleading advertising hoarding. black marketing
etc.

5. Government Intervention A business engaging in any form of exploitation time
trade practices would invite government intervention or action. Thus, it is
advisable that business organisation voluntarily resort to such practices, where the
customers need and interests will be taken care of.

Question 2. Explain the rights and responsibilities of a consumer.
 Answer The Consumer Protection Act provides six rights to consumers. They are as
follows
1. Right to Safety The consumer has a right to be protected against goods and
services which are hazardous to life. e.g., sometimes we purchased the food
items of low quality which causes severe problems. Thus, in this case, we should
purchased good quality and FPO labelled products,
2. Right to be Informed The consumer has a right to have complete information
about the product. which he intends to buy including its ingredients, date of
manufacture, price, quantity, directions for use etc. Under the legal framework of
India manufactures have to provide such information on the package and label of
the product.
3. Right to Choose The consumer has the freedom to choose from a variety of
products. The marketers should offer a wide variety of products and allow the
consumer to make a choice and choose the product which is most suitable.
4. Right to be Heard The consumer has a right to file a complaint and to be heard in
case of dissatisfaction with a good or a service. It is because of this reason that
many enlightened business firms have set up their own consumer service and
grievance cells.
5. Right to Seek Redressal The Consumer Protection Act provides
a number product, of reliefs to the removal of defect consumer including
replacement of the in the product, compensation paid for any loss or injury
suffered by the consumer etc.
6. Right to Consumer Education The consumer has a right to acquire knowledge
about products. He should be aware about his rights and the reliefs available to
him in case of a producVservice falling short of his expectations Many consumer
organisations and some enlightened businesses are taking an active part in
educating consumers in this respect.

Consumer Responsibilities

A consumer must be aware about these responsibilities while purchasing, using and
consuming goods and services
1. Consumer must be aware of all their rights.
2. Consumer must be careful while purchasing a product.
3. He should file complaint for the redressal of genuine grievances.
4. Consumer must buy a standardised good.
5. He should ask for a cash-memo on purchase of goods and services.

Question 3. What are various ways in which the objective of consumer protection can
 be achieved? Explain the role of consumer organisations and NGOsin this regard?
 Answer There are various ways in which the objective of consumer protection can be
achieved

(i) Self Regulation by Business Socially responsible firms follow ethical standards and
practices in dealing with their customers. Many firms have set up their customer service
and grievance cells to redress the problems and grievances of their consumers.

(ii) Business Associations The associations of trade, commerce and business like
Federation of Indian Chambers of Commerce of India (FICCI) and Conference of Indian
Industries (CII) have laid down their code of conduct which lays down for their members
the guidelines in their dealings with the customers.

(iii) Consumer Awareness A consumer, who is well informed about his rights and the
reliefs, would be in a position to raise his voice against any unfair trade practices or
exploitation.

(iv) Consumer Organisations Consumer organisations plays an important protecting role
in educating consumers about their rights and them. These organisations can force
business firms to avoid malpractices and exploitation of consumers.

(v) Government The Government can protect the interests of the consumers by
enacting various legislations. The legal framework in India encompasses various
legislations which provide protection to consumer, the most important of these
regulations is the Consumer Protection Act, 1986. The Act provides for a three-tier
machinery at the District, State and National levels for redressal of consumer grievance.
 Question 4. Explain the redressal mechanism available to consumers under the Consumer Protection Act, 2019
 Answer The Consumer Protection Act, 2019, provides a comprehensive redressal mechanism for consumers to seek remedies in case they face issues with goods or services. Here's an overview of the redressal mechanism available under the Act:

1. District Consumer Disputes Redressal Commission (DCDRC): This is the first tier of dispute resolution. Consumers can file complaints regarding goods or services valued up to ₹1 crore ($135,000) before the DCDRC, which is located at the district level.

2. State Consumer Disputes Redressal Commission (SCDRC): If a consumer is dissatisfied with the decision of the DCDRC or if the value of the dispute exceeds ₹1 crore ($135,000), they can appeal to the SCDRC, which operates at the state level.

3. National Consumer Disputes Redressal Commission (NCDRC): The apex consumer court in India, the NCDRC, hears appeals against the orders of the SCDRC and cases involving disputes valued over ₹1 crore ($135,000). It also deals with cases that involve substantial questions of law.

4. Alternate Dispute Resolution (ADR) Mechanisms: The Consumer Protection Act encourages the use of mediation, conciliation, and arbitration as alternative methods for resolving consumer disputes. These mechanisms aim to provide quicker and less formal avenues for resolving disputes outside the traditional court system.

5. Consumer Commissions' Powers: The Consumer Protection Act empowers consumer commissions to issue various orders, such as refund of the price paid, replacement of goods, removal of defects, payment of compensation for any loss or injury suffered, discontinuance of unfair trade practices, and discontinuance of the restrictive trade practices.

6. Online Consumer Disputes Redressal: The Act recognizes the importance of online transactions and provides for the establishment of an online dispute resolution mechanism to facilitate the resolution of disputes arising from e-commerce transactions.

Overall, the Consumer Protection Act, 2019, aims to provide consumers with efficient and accessible mechanisms to seek redressal for grievances related to defective goods, deficient services, unfair trade practices, or exploitation by sellers or service providers.

Question 5. Explain the role of consumer organisations and NGOs in protecting and
 promoting consumers’ interest.
 Answer Consumer organisation and NGOs perform several functions for the protection
and promotion of interest of consumers. In India, these associations are performing lots
of functions some of them are
1. Educating the general public about consumer rights by organiSing training
programmes, seminars and workshops.
2. Publishing periodicals and other publications to impart knowledge about consumer
problems, legal reporting, reliefs available and other matters of interest.
3. Carrying out comparative testing of consumer products in
accredited laboratories to test relative qualities of
competing brands and publishing the test results for the benefit of consumers.
4. Encouraging consumers to strongly protest and take an action against
unscrupulous, exploitation and unfair trade practices of sellers.
5. Providing legal assistance to consumers by providing aid, legal advice etc in
seeking legal remedy.
6. Filing complaints in appropriate consumer courts on behalf of the consumers.
7. Taking an Initiative in filing cases in consumer court in the interest of the general
public, not for any individual.

Question 6. Mrs. Mathur sent a jacket to a laundry shop in January 2018. The jacket was purchased at a price of `4,500. She had previously sent the jacket for dry cleaning with Shine Dry Cleaners and the jacket was cleaned well. However, she noticed that her jacket had white discoloration marks when she collected the jacket this time. On informing the dry cleaner, Mrs. Mathur received a letter confirming that discolouration indeed appeared after the jacket was dry cleaned. She contacted the dry cleaner multiple times and requested for compensation for discoloured jacket but to no avail. 

Upon Consumer court’s intervention, Shine Dry Cleaners agreed to compensate Rs. 2,500 to Mrs. Mathur for the discoloured jacket. 

(a) Which right was exercised by Mrs. Mathur at the first instance. 

(b) Name and explain the right which helped Mrs. Mathur to avail the compensation. 

(c) State which consumer responsibility has been fulfilled by Mrs. Mathur in the above case. 

(d) State any other two responsibilities to be assumed by the consumers. 

Answer (a) Mrs. Mathur exercised her right to seek redressal for grievances, specifically regarding the quality of service provided by Shine Dry Cleaners. 

(b) The right that helped Mrs. Mathur to avail compensation is the right to seek redressal. This right ensures that consumers have access to a fair and efficient mechanism to resolve disputes and seek remedies for any deficiencies in goods or services purchased. By approaching the consumer court and seeking intervention, Mrs. Mathur exercised her right to seek redressal, which ultimately led to Shine Dry Cleaners agreeing to compensate her for the discolored jacket.

(c) Mrs. Mathur fulfilled her responsibility to be vigilant and assertive. She noticed the issue with her jacket immediately upon collection from the dry cleaner and took proactive steps to address the problem. By contacting the dry cleaner multiple times and pursuing the matter until a resolution was reached, she demonstrated diligence in asserting her rights as a consumer. 

(d) Two other responsibilities assumed by consumers include:

1. Responsibility to be Informed: Consumers have a responsibility to gather information about the products or services they purchase, including their quality, price, and terms of service. Being informed allows consumers to make educated decisions and choose products or services that best meet their needs.

2. Responsibility to Provide Feedback: Consumers should provide feedback to businesses regarding their experiences with products or services. Whether positive or negative, feedback helps businesses improve their offerings and ensures better satisfaction for future consumers. Additionally, providing feedback can also help other consumers make informed decisions.

Question 1. What new measure is the ministry of consumer affairs taking to make filing
 a complaint easy?
 Answer Online registration of complaints has been initiated by the ministry of consumer
affairs to make filing of complaint easy.

Question 2. What roll can you as a student play to contribute to the cause of consumer
 protection?
 Answer A student can play an active role in bringing out an awareness campaign on

‘Consumer Protection’.

1. Special assemblies can organised to show the display of consumer rights and
responsibilities
2. When school organises any exhibilion the commerce students can put a stall and
give demonstration on responsibilities of a consumer,
3. The Biology and Chemistry laboratories can be used for testing adulterated goods.
(e.g milk, paneer, spices etc).
4. Essay writing competitions, debate competition and quiz can be organised to
promote the awareness on consumer protection,
5. Encourage students to boycott goods/eatables which are adulterated or defective
in school canteen.
6. To set up voluntary complaint centre for consumer guidance and counseling,

Question 3. What scenario of consumer protection do you foresee when the measures
 proposed in the above news report are implemented?
 Answer With the Implementation of online registration, educated and technology
friendly consumer will gain but in my opinion the unaware, ignorant and Simple
consumers who still are far away from e-governance would stand in need of the 3
forums working efficiently and effectively Thus both the systems should work parallel,
hand in hand to protect the interests of different types of consumers.