LAW OF CONSUMER

PROTECTION
-
LA1205
 SYLLABUS
• Background and history of consumer protection, Objects, Reasons and purpose,
Important definitions – consumer, consumer dispute, defect, deficiency, goods,
manufacturer, restrictive trade practice, service, unfair trade practice, Consumer
Protection Council, Consumer Disputes Redressal Agencies – District forum, State
commission, National commission – Composition, Power, Procedure and appeal,
Contemporary issues in Consumer Affairs, Leading Cases.

References:

1. Gupta Sen, Consumer Protection Act, 3rd edition, Kamal Law House, 2014.
2. Saharay H.K., Textbook on Consumer Protection Law, 1st edition, Universal Law,
2010.
3. Myneni S.R. Consumer Protection Law, 9th edition, Asia Law House, 2012.
4. Chakraborty Anirban, Law of Consumer Protection, 5th edition, Lexis Nexis, 2014.
5. Bare Act: Consumer Protection Act, 2019
 ORIGIN AND
DEVELOPMENT

British Post-
Vedic Period Independenc
Period
e Era
SOURCES OF HINDU LAW
 CONT.
 Vedic Period:
• This was the formative stage of Indian Civilization.
• This is the sources of Hindu Law.
• The Vedas and its traditions are considered to develop
law relating to consumer protection.
• They were considered as the source of knowledge.
CONT.
Later Smriti (Dharmashastra)
It laid down the duties and conduct of consumer protection . It also created the legal
mechanism for regulation of weight and measures.
Manu Smriti: (Code of conduct to traders)
• Problem of adultery – one commodity mixed with another must not be sold (as pure), nor a
bad one (as good) not less (than the property weight and quantity) nor anything that is at
hand or concealed.
• Punishment – man who behaves dishonestly shall be fined.
• Inspection- proper process to inspect all weights and measures and were noted.
Arthashastra: Kautilya
• Director of trade – responsible to monitor market situations.
• Traders were made responsible for fair trade practices. Overall check was made by the
King.
• Maintenance of official standards of weights and measures.
• Stamping of weights and measures in every four months.
• Punishment- severe punishments cutting-off one hand or fine for cheating etc.
CONT.
• Goods sold – the goods should be sold in appointed markets
only.
• Declaration – particulars as to quantity, quality and prices
which were examined and registered in the books.
• License – license to sell required for every trader.
• Superintendent of Commerce – fixation of wholesale price.
Speculation and cornering to influence prices were prohibited.
• Punishments – Severe punishment for smuggling and
adulteration of goods.
• Remedies – Easy access to justice for all including consumers
was of great importance.
 CONSUMER PROTECTION DURING
MUGHAL RULE

• The Muslim law was introduced in India with the begin of Islamic rule.
• Though Hindus were governed by Hindu law, yet few new features were introduced by Mughal
Rulers.
• Strict Price control regulation of weight and measures, restriction on Unfair Trade Practices
were targeted to protect the consumer interest.
• This was the time when law was strictly applied with no scope of tolerance.
• The burden was made upon manufacturer and seller with regards “ Duty of Care”, which means
seller were made responsible for any goods which were defective in nature and which could not be
determined by the buyer.
• This System continued till the advent of British rule when the formation of a unified
nationwide modern legal system were defined.
CONT.

• However, the ancient rules were not ignored during British era and

the laws were formed in consonance with structural features.

For example: personal laws were adapted as per the customary

practices, Dharmas and customs were given equal importance.

• Therefore, both British and Indian legal system were

fabricated together towards formation Modern Indian law.

 BRITISH ERA
 The Indian Penal Code, 1860:
• Section 264-267: fraudulent use of false instruments for weighing
and their possession, manufacturing or sale; etc.
• Section 272-276: offences related to adulterated food, drinks,
noxious foo/ drink and sale of adulterated drugs.
 The Indian Contract Act, 1872:
• Section 27- Agreement is restrain of trade as void
CONT.

 The Sale of Goods Act of 1930:

• It was praised as Consumer Charter because protection was given to buyer
against the sellers who used to sell defective goods. There was the shift in the
principal Caveat Emptor(Lets the Buyer be aware ) to Caveat venditor (Let the
Seller be aware)which stressed upon skill and judgments of seller, merchantable
quality of goods while selling.
• Until 1986 was SoGA was relied for the protection of Consumer interest.
 Other enactments related to protection of Consumer right:
• The Agricultural Produce (Grading & Marking) Act, 1937
• The Drugs and Cosmetics Act, 1940
 POST INDEPENDENT ERA

The Acts which were enacted in Independent India are given below-
• The Drug (Control) Act, 1950
• The Industries (Development and Regulation) Act, 1951
• The Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954
• The Prevention of Food Adulteration Act, 1954
• The Essential Commodities Act, 1955
• The Trade and Merchandise Marks Act, 1958
• The Monopolies and Restrictive Trade Practices Act, 1969
• The Cigarettes (Regulation of Production, Distribution, and Supply) Act, 1975
• The Standards of Weights and Measures Act, 1976
• The Prevention of Black Marketing and Maintenance of Supplies of Essential Commodities Act,
1980
• The Standards of Weights and Measures (Enforcement) Act, 1985
• The Bureau of Indian Standards Act, 1986
 SOME MAJOR CONSUMER PROTECTION ACTS
 Prevention of Food and Adulteration Act, 1954
• The Act was enacted to eradicate the anti-social evil of food adulteration and
ensure purity.
• Prohibition was imposed upon adulteration and misbranding of food.
• The central government and state governments framed rules regarding Central
Food Laboratory, Standard of quality, public analysts and inspectors, ceiling,
fattening and dispatch of samples, coloring matter, packing and labeling of foods,
prohibition and regulating sales, conditions for sale and license, preservative,
poisonous metals, and solvent-extracted oils and edible flour etc.
 Monopoly and Restrictive Trade Practices Act, MRTP Act, 1969
The Act was enacted so that there would not be any concentration of economic
power as a result of economic system operations, and prohibition of Monopoly and
restrictive trade practices. MRTP commission established under an act to enquire
into monopolistic and restrictive Trade practices. The Commission has power to
grant injunction and provide compensation
CONT.

 The Bureau of Indian Standards Act, 1986

An Act to provide for the establishment of a Bureau for the
harmonious development of the activities of standardization,
marking and quality certification of goods and for matters
connected therewith or incidental thereto.
 The Essential Commodities Act, 1955
Act was enacted in the interest of the general public, for the
control of the production, supply and distribution of, and trade
and commerce, in certain commodities.
• The benefit of these Acts was that they do not require the consumer to prove mens rea.
Rather, “the offenses were of strict liability, and were not dependent on any particular
intention or knowledge.
• Consumer rights were also protected through criminal law since the Consumer dispute
were treated as public interest issue rather than a private issue.
• The remedy for consumer dispute were also protected under law of torts but with the
introduction of new legislations, law of torts was not considered as appropriate remedy.

For example- Doctrine of negligence required to plaintiff to proof all the requirements of
the case.
Case: Mahanagar Telecom Nigam v. Vinod Karkari (inflated telephone bill was given to
the plaintiff and his connection was disconnected on the non-payment of unjustified bill.
Such act was considered as negligent but required consumer to prove all the ingredients
of wrong.)
• Thus, it was appropriate in the interest of consumers to opt for separate legislation.
• Unfortunately, not many cases were adjudicated protecting the consumer interest under law
of torts and Indian Contract Act which increase the demand for specific legislation to
protect the consumer, Hence Consumer protection Act, 1986 was enacted providing cheap,
simple speedy justice.
CONT.
But all these Acts were not as successful as they were expected
to be and that is why to provide for better protection of the
interests of consumers and to save them from the evils of unfair
trade practices, Consumer Protection Act, 1986 was enacted by
Indian Government and this Act is an additional Act not the
derogation of any other existing law.
IMPORTANCE OF CONSUMER PROTECTION ACT
Importance from the Consumer’s Point of view:
• Unorganized Consumers -In developing countries like India,
consumers are not organized. There are very few consumer
organizations that are working to protect the interest of
consumers. Consumer protection provides power and rights to
this organization as these organizations can file a case on behalf
of the customer.
• Consumer Ignorance-It spreads awareness so that consumers
can know about the various redressal agencies that they can
approach to protect their interests.
• Wide Spread Exploitation of Consumer’s-There is a lot of
exploitation of consumers as businessmen use various unfair trade
practices to cheat and exploit consumers. Consumer protection
provides safeguard to consumers from such exploitation.
 BACKGROUND OF CONSUMER
PROTECTION BILL, 1986
• The series of enactments were adopted yet the consumer were not given desired protection.
• Thus, an attempt was made to enact separate legislation to protect consumer rights.
• The Bill of Consumer protection law was introduced in 1977 but it failed in the Parliament.
• In1984, the Law Commission in its 105th Report for Quality Control and Inspection of
Consumable Goods under the Chairmanship of KK Mathew suggested the need of separate
legislation protecting the consumer rights.
• Meanwhile, MP Government has introduced MP Consumer Protection Bill, 1984 which
had the provision to establish consumer education and research training centre, price review
commission, fair trade practices forum, Consumer council at district, village and ward
level.
• India wanted to improve the productivity of Indian economy which required the upliftment
of weaker section, thus, the then Prime minister Shri Rajiv Gandhi has also targeted
consumer protection as an important aspect among the socio-economic program of the
country.
 GUIDELINES OF UNITED NATION

Consumer movements in early 20th century was started in USA and Europe.
The international consumer movement reached in its peak in 1960 which
was spreading to japan, UK, France, Norway and Sweden but the consumer
in developing Countries were still the victims of market forces. In 1981,
UN Secretary General was requested to make consultation with Economic
and Social Council of United Nation (ECOSOC). Resultantly, UN in 1985
has adopted General guideline for consumer protection, whereby member
countries were asked to adopt legal framework within their territorial
Boundaries to protect consumer interest.
 UN GUIDELINES FOR
CONSUMER PROTECTION
• National policies for consumer protection
• Physical safety
• Promotion and protection of the economic interests of consumers
• Standards for safety and quality of goods and services
• Distribution facilities for essential goods and services
• Dispute resolution and redress
• Education and information programmes
• Promotion of sustainable consumption
• Electronic commerce
• Financial services
CONT.
• Based on UN guidelines, meetings and workshop were conducted
whereby suggestion and recommendation made by state governments,
consumer organization and Central Ministries also law of various
countries were studies and draft of consumer protection bill were
prepared and submitted to Lok Sabha on 9th December 1986
• Consequently, the bill was passed and received the assent of president on
24th December 1986
• The Act came into effect on 15th April 1987.
 CAVEAT EMPTOR
 It is a Latin term, adopted in India from England. Caveat means
“warning” and emptor means “buyer.” it is the duty of buyer to
satisfy himself.
Cases:
1. Burn by v. Bollet (1847)
2. 2. Rarelto v. T.R Prince (1939)
Present Picture:
More importance to the principle is given since there is increase in
trade and globalization.
Complex structure of modern goods makes the consumer comes at
vulnerable place which require the need for protection from
exploitation done by sellers.
 INTRODUCTION OF CONSUMER
PROTECTION ACT 1986
• The Indian Legal system has evolved with enactment of Consumer
Protection Act (CPA) which was specifically enacted to protect consumer
interest.
• The Act intended to provide:-
1. Easy access to justice
2. Right to have unadulterated and defect free commodity at appropriate
prices.
3. A cost effective and users friendly legal remedy under three level quasi
judicial redressal agencies
• CPA empowered consumer group, Central and State Government to file
complaint against any violation.
• CPA includes both goods and services in its ambit which empower the
consumer to file complain about defective product and deficiency in
services, whether provided by government or private companies.
CONT.
• The preamble of the Act provides- That the Act was enacted for :
1. Better protection of consumer interest
2. Establishment of Consumer council
3. Other authorities for settlement of consumer dispute and matters connected therewith.
The objective of the Act was:
4. Promotion and protection of consumer rights (right to be protected, informed,
assured, heard, seek redressal and consumer education)
5. Protection of consumer rights through consumer protection council established at
national and state level and district level.
6. Speedy and simple redressal mechanism through the quasi-judicial body at district,
state and national levels.
7. Redressal of consumer dispute through relief granting mechanism which can be
specific in nature including compensation to the consumer and penalties for non-
compliance of the order.
8. Amendments in 1991, 1993 and 2002 were introduced with the objects that were expanded
after experiencing few difficulties.
 A SHIFT FROM CPA, 1986 TO CPA, 2019
Despite various amendments, many shortcoming were noticed under CPA 1986, namely-
1. Although the purpose of dispute redressable agencies was served considerably but the
disposal of cases were not speedy.
2. Consumer market was transformed drastically with many product and services.
3. Establishment of global supply chains and increase in the international trade has shifted
the consumer for e- commerce with new delivery system.
4. Although new options were given to consumers, but modern trading system has also
increased the misleading advertisements, unfair and unethical trade practices which
was determinantal to the consumer interest.
• In 2011 the Consumer Protection Bill was introduced but it lapsed due to dissolution of
Lok Sabha.
• Consumer Protection Bill 2015 was again introduced in newly resolved Lok Sabha which
was further sent to Standing Committee.
• Consumer Protection Bill, 2018 was again introduced based on recommendation of
Standing Committees in Lok Sabha but it got lapsed with the dissolution of Lok Sabha.
 CONT.
• Hence, the Consumer Protection Bill, 2019 was introduced with
certain new elements in it aiming towards protection of consumer
interests:
1. Establishment of CCPA (Central Consumer Protection Authority)
2. Provisions of product liability actions
3. Insertion of ADR mechanism
4. Increased pecuniary jurisdiction of dispute redressal commissions
5. Provisions regarding e-commerce trading has been included
6. Provision for filing electronic complaints has been added.
• The Bill was passed by both the Houses and received the President’s
assent on 9th August 2019.
 OBJECTIVES OF
CONSUMER PROTECTION
ACT, 2019
• Increase the monetary jurisdiction of district/state/national
forums and commissions.
• Confer additional powers on the redressal agencies by way of
awarding costs, removal of defects and to empower recall of
goods likely to endanger safety of the public.
• Impose punishment on complainant in case of frivolous or
vexatious complaints.
 COMPARISON BETWEEN CONSUMER
PROTECTION ACT 1986 AND 2019
CPA 1986 CPA 2019

Pecuniary Jurisdiction- District forum (up to 20 District forum (up to 1 crore), State commission
lakhs), state commission (above 20 lakhs to 1 (from 1 crore to 10 crore), National commission
crore), national commission (above 1 crores) (from 10 crore and above)
Earlier MRP was a criteria to decide pecuniary Now discounted price/ actual purchase price is
jurisdiction criteria
Regulator- no provision Central Consumer protection authority to be
formed
E- Commerce – no facilities E- Commerce included

No implicit provision of Mediation Included in the Act

No provision of Product manufacturer/ service Specific provision regarding product

provider manufacturer/ service provider

Territorial Jurisdiction was where seller has office Territorial Jurisdiction is where complainant
resides or works
 CONSUMER PROTECTION
ACT, 2019
 SECTION 1: Short Title, extent, commencement and application
• This Act is known as Consumer Protection Act, 2019
• The Act extends to whole of India.
NOTE: After J&K Reorganization Act, 2019, the Act has repealed all the
commissions established under the special Acts for J&K and now central
legislations are made applicable in J&K also.
• The Act shall come into force by the notification made by the Central
government and different dates may be appointed for different states.
• The Act shall be applicable on all goods and services
• The CPA, 2019 was made applicable on 20 th July 2020.
 SECTION 107
Applicability
of CPA

Applicability Applicability
of CPA, 1986 of CPA, 2019

Made
Applied before Applied in applicable on
20th July 2020 pending cases and after 20th
July 2020
 CONT.
 Section 6 of General clauses Act, 1897:
• It provides that repealing of any enactment shall not affect the rights, liabilities,
obligations and investigation made under the previous Act.
• After the enactment of new legislation, the pending proceedings filed under the
Old Act shall not abate on the passing of the New Act.
• Case: SEBI v. Classic Credit Ltd, SC observed that unless the amending
provision by express words, or by necessary implication, mandates the ‘transfer’
of proceedings to the ‘forum’ introduced by the amendment, the ‘forum’
postulated by the unamended provision would continue to have the jurisdiction
to adjudicate upon pending matters.
 Section 107- Repeal and Savings
• Anything done or any action taken or purported to have done or taken under CPA
1986, shall be deemed to have been done under the correspondence of CPA,
2019.
Provided the provisions of CPA1986 is not inconsistent with the provisions
of new Act.
DEFINITIONS

 CONSUMER: SECTION 2(7)

• The one who purchases goods or services for private use or
consumption.
• The person who comes at the end of production chain and
covers every person who pays money as the price for goods
and services.
• As per the Black’s Law Dictionary- consumer is one who
consume, individual who purchase, use , maintain and dispose
of the product and services;
• Belongs to class of people who are affected by pricing policies,
financial practices, quality of goods and services and other
trade practices for which state consumer protection laws are
enacted.
 CONT.
 Person- section 2(31)-
• Consumer includes a person.
• The definition of person is inclusive definition which include
natural person, person created under statute, body of person
forming of association.
• In the earlier Act, only four categories of person was
mentioned in the definition. Hence the supreme Court in
Karnataka Power Transmission vs Ashok Iron Works Pvt
Ltd. Held that it is inclusive definition and not exhaustive.
 CONT.
• THE GOODS ARE BOUGHT FOR CONSIDERATION - There must be a sale transaction between a seller and
a buyer. The terms sale, goods, and consideration have not been defined in the Consumer Protection Act. The
meaning of the terms ‘sale’, and ‘goods’ is to be construed according to the Sale of Goods Act, 1930 and the
meaning of the term ‘consideration’ is to be construed according to the Indian Contract Act, 1872.
• ANY PERSON WHO USE THE GOODS WITH THE APPROVAL OF THE BUYER IS A CONSUMER - When a
person buys goods, they may be used by his family members, relatives and friends. Any person who is
making actual use of the goods may come across the defects in goods. Thus the law construe users of the
goods as consumers although they may not be buyers at the same time.
CASE: Dinesh Bhagat v. Bajaj Auto Ltd. (1992) III CPJ 2

A purchased a scooter which was in B’s possession from the date of

purchase. B was using it and taking it to the seller for repairs and
service from time to time. Later on B had a complaint regarding the
scooter. He sued the seller. The seller pleaded that since B did not buy
the scooter, he was not a con­sumer under the Act. The Delhi State
Commission held that B, the complainant was using it with the approval
of A, the buyer, and therefore he was consumer under the Act.
NOTE: This is an exception to the general rule, “stranger to the contract
cannot sue.”
 CONT.
• The definition of consumer is divided in two parts:
1. Goods
2. services
• Their ambit is enlarged using inclusive clause. Not only purchaser or hirer is
included but even the beneficiaries with the approval of person who
purchased goods or services are included.
• So, consumer of goods:
1. Any person buys any goods for consideration or
2. Lawful user of goods with the approval of buyer
Exception is:
3. Goods used for resale; (means goods are not for immediate final
consumption but there is only transfer of goods)
4. For commercial purpose. (will be discussed in later PPT)
 CONT.
• Consumer of services:
1. Services availed by any person or
2. Beneficiary of services
Thus, the definition of consumer is inclusive and extensive.
Because the Act does not only limit itself to original
purchaser/hirer, but it also includes subsequent beneficiary.
• However, the definition excludes:
1. Services which are availed for commercial purpose;
2. Services hirer or availed free of charge;
3. Delivered under a contract of personal service.
 COMMERCIAL PURPOSE
• The definition of consumer, excludes the goods or services purchased
or availed for commercial purpose because the intention of the
legislature to the restrict the benefit of the Act only towards the
ordinary consumers who are using the goods and services for their own
consumption.
• The number of factors has to be seen for defining “commercial
purpose,” such as scope of business, investment made, intention of
doing business (whether to earn livelihood or to earn profit)
• Explanation (a) provides that commercial purpose does not include
goods bought by the consumer for earning livelihood, by self
employment.
• Therefore, it is an exception to an exception where a person is using
goods for himself, by employing himself for earning livelihood.
 CONT.
• CASE: SYNCO TEXTILE PVT. LTD. V. GREAVES
COTTON CO. LTD. (1991) 1 CPJ 499
• The reliance was made on to the definition of Commercial
Purpose where the National Commission has held that
commercial means, pertaining to commerce; connected wit or
engaged in commerce; having profit as a main aim.
• Thus, commercial purpose should be distinguish from
commercial organization or commercial activities. And it is the
purpose for which the goods are purchased has to be given
importance.
 CONT.
• CASE: LAXMI ENGINEERING WORKS v. PSG
INDUSTRIAL INSTITUTE, AIR 1995, SC 1428
Appellant was a small scale industry, which has ordered PSG-
450 CNC machine. The machine was delivered late and was
found defective. The Appellant filed a complaint under state
commission, which had allowed the claim to Appellant. But,
National Commission has reversed the Order and the same
was challenged in Supreme Court.
 CONT.
The question was to identify whether the industry is consumer or
falls under the category of Commercial Purpose?
The SC has laid down that it is not the value of goods but for what
purpose it was purchased.(and not depend upon the condition of
large scale or small scale business). The purpose includes, direct
nexus between purchase of goods and the profit or loss from their
disposal.
The explanation clarifies that in certain situations purchase of
goods for commercial purpose would not take purchaser out of the
ambit of definition of “Consumer.”
So, the SC held that the Appellant was not a consumer and the
purpose for purchasing the machines was a commercial purpose.
 CONT.
CASE: Madan Kumar Singh v. District Magistrate, Sultanpur, (2009) 9 SCC 79
Appellant purchased a truck from an auction sale made under the district magistrate
and deposited the money and fulfilled all the formalities. Yet, the possession and
documents were not delivered to him.
Subsequently, possession of truck was delivered but the papers were not transferred.
He filed the complaint but the complaint was dismissed on the grounds that
appellant was not a “Consumer” since he used the truck for commercial purpose. So
the appeal went to SC.
The SC held that appellant is consumer since he bought the truck for consideration
paid by him. The truck was used exclusively for earning his livelihood by mean of
self employment. The intention of the legislature is to exclude those persons who
obtain goods for resale.
Also, direct nexus with the profit or loss would determine the nature of commercial
purpose. Thus, the buyer of goods for self consumption in economic activities
would be consumer. Thus, it was considered that the truck bought by the Appellant
for the purpose of earning livelihood.
 CONT.
• DATA CORE INDIA PVT. LTD. V. WEST BENGAL
STATE COOPERATIVE HOUSING FEDERATION
LTD. (MANU/CF/0004/2010)
The state commission held that purchase of software for
internal accounting of a commercial institution does not
amount to commercial purpose.
Thus, demarcation is made on the basis of whether the
purchase goods or availed services are directly involved in
the commercial institution.
 Goods section 2(21)
• It means every kind of movable property and includes food defined under section
3(1)(j) of FSS Act.
• A good refers to a tangible item received by the consumer from the trader or producer for a
considerable amount.
• It enlarge the scope of the definition under CP Act 2019
• According to Sales of Goods Act- Includes stock and shares, growing crops, grass, and
things attached to or forming part of the land which are agreed to be severed before
sale or under the contract of sale
• Section 3(1)(j)- "food" means any substance, whether processed, partially processed or
unprocessed, which is intended for human consumption and includes primary food, to
the extent defined in clause (ZK) genetically modified or engineered food or food
containing such ingredients, infant food, packaged drinking water, alcoholic drink,
chewing gum, and any substance, including water used into the food during its
manufacture, preparation or treatment but does not include any animal feed, live
animals unless they are prepared or processed for placing on the market for human
consumption, plants prior to harvesting, drugs and medicinal products, cosmetics,
narcotic or psychotropic substances: Provided that the Central Government may
Defective Goods Section 2(10)

To claim the defect in the good, these following point must be proved-
1. Any Fault, imperfection or shortcoming
2. Such fault, imperfection or shortcoming should be in the quality, quantity, potency, purity
or standards of goods
3. The standards of goods – according the law in force or claimed by the trade in particular
manner.
For e.g. the complainant suffered from paralysis by the consumption of adulterated food, which
was confirmed by the laboratory test. It was held that complainant was intitled for the damages
(Barsad Ali Vs Managing Director, West Bengal Essential Supplies Commodities Ltd). (1993
CPJ 173 WB)
• It is an exhaustive definition. The forum only consider the defect mentioned in the definition.
But the SC interpretate the provision and held that the approach of the forum has to be
rational consistent with the purpose of the act rather than technical.(H.N Shankar
Shastry vs The Assst. Director of Agriculture, Karnataka. AIR 2004 SC 3474)
 Services 2(42)

1. service” means service of any description which is made avail­able to potential users
and includes the provision of facilities in connection with banking, financing
insurance, transport, processing, supply of electrical or other energy, board or lodging
or both, housing construction, entertainment, amusement or the purveying of news or
other information, but does not include the rendering of any service free of charge
or under a contract of personal service
This definition divided into 3 parts
2. “Any description which is made available to potential users” This part is in
explanatory in nature
3. The words “ any” used in a wide amplitude and The potential users does not only
mean the actual users but the capable of using it like LIC
4. Second part is inclusionary part and last one is Exclusionary part.
5. It includes both the occupational and professional services. Like banking sector,
medical negligence, etc (Indian Medical Association vs. V.P Shanta and others and D.K.
Gandhi vs M. Mathias )
 Cont.

• Two exception define under definition of Services -

1. Free of Cost
2. Services render for personal services- In Indian Medical
Association vs V. P Shanta- The SC emphasis that personal service
stands for Contract of service(Master servant relationship). Thus it
exclude the service render by the employee to his employer or vice
versa under the contract of services.
But Contract for Services come under the ambit of services.
Nivedita Singh vs Dr. Asha Bharti &ors- Since the admitted case of the
appellant is that the appellant has not paid any consideration for availing the
services of the respondents - doctors and the nurses, she would not be covered
under the definition of consumer to avail the remedies under the Act. "
https://www.latestlaws.com/case-analysis/can-a-patient-who-was-
provided-free-medical-care-sue-doctor-in-consumer-court-sc-
replies-180258
 Deficiency Services Section
2(11)
• Any fault, imperfection, shortcoming on inadequacy in the quality nature
and manner of performance.
• The burden of proving of deficiency of services is upon the person who
alleged that.
• SC held that if a loss or damages is caused , it is not enough to hold
deficiency. It has to be shown that the loss or damaged is caused due to
the negligence in the nature or manner of performance of the services.
• One interesting aspect is that deficiency in service should occur during the
happening of performance. Thus it is crucial to determine when the
performance of a service commenced.
• The deficiency must be in relation to a service.
 Unfair Trade Practices Section 2
(47)
• The definition states that any unfair and deceptive practices used for promoting sale or supply of
goods and services at the cost of the consumer interest
• This definition based on the MRTP Act.
• the consumers are exploited by way of numerous forms of unethical and unfair practices such as
defective goods, deficient services, dubious hire purchase plans, high cost of products, spurious
drugs, adulteration of food, poor quality, deficient services, deceptive advertisements, hazardous
products, black marketing among others
• This definition have 3 essential elements-
1. That the practices in question is a trade practice i.e practices of trade or the practices is connected
with trade.
2. That trade practices must be used for promoting trade, sale, use or supply of any goods services
3. That loss or injury caused to the consumer by adoption of such trade practices due to absence or
elimination of restriction of competition.
In a recent case where Big Bazar, a departmental store declared Republic Day as Mega Savings Day,
which led to an unmanageable consumer rush. To restrict entry to legitimate purchasers, the store came
up with a scheme of issuing an entry coupon of Rs 50. The National Commission concluded that Big
Bazar had not indulged in unfair or restrictive trade practice. It held that an entry fee does not bring
about a manipulation in the price of a product or service, but merely regulates customer crowd. The
practice is prevalent worldwide, and is permissible .
 Restrictive Trade Practices
2(41)
• In General term Restrictive Trade practices means - Practices restrictive in nature and put
restrictions on flow of supplies in a market and trade
• Any agreement which is restrictive trade practices in nature, whatsoever may be in the manner of
restriction at the cost of the consumer interest
SC analyzed the definition in TELCO vs Registrar of the Restrictive Trade Agreements , to
identify whether particular practices is Restrictive in nature or not can be decide by applying the
Rule of Reason
1. What facts are peculiar to the business to which the restraint is applied?
2. What was the condition before or after the restriction is applied
3. What is the nature of the restrain and what is its actual or probable effects.
In Mahindra and Mahindra Ltd. Vs Union of India
It was observed by the SC that any Trade practices may have the effect of preventing, distorting or
restricting the competition consider to be restrictive trade practices.
Cont.
• Where sale or purchase of a product or service is made conditional on the sale
or purchase of one more other products and services, it amounts to restrictive
trade practice.
• The effect of such an arrangement is that a purchaser is forced to buy some
goods or services which he may not require along with the goods or services
which he wants to buy. This arrangement is called tie up- sale.
• A, a gas distributor instead his customers to buy gas stove as a condition to give
gas connection. It was held that it was a restrictive trade practice - Re. Anand
Gas RTPE 43/1983
• A is a furniture dealer. He is selling Sofa at Rs.20,000 and Bed at Rs.15,000. He
has an offer that whoever will buy Sofa and Bed both, he will charge Rs.30,000
only. Here the choice is open to the customer to buy the products single or
composite. This is not a restrictive trade practice.
Consumer rights section
2(9)
Consumer rights" includes,—
(i) the right to be protected against the marketing of goods, products or services
which are hazardous to life and property;

(ii) the right to be informed about the quality, quantity, potency, purity, standard
and price of goods, products or services, as the case may be, so as to protect the
consumer against unfair trade practices;

(iii) the right to be assured, wherever possible, access to a variety of goods,

products or services at competitive prices;

(iv) the right to be heard and to be assured that consumer's interests will receive
due consideration at appropriate fora;

(v) the right to seek redressal against unfair trade practice or restrictive trade
practices or unscrupulous exploitation of consumers; and

(vi) the right to consumer awareness;

Consumer Dispute section
2 (8)
• Dispute where the person against whom
complaint has been made, denies, or dispute
the allegation contained in the complaint.
Definition
• 1. Complainant- section2(5)-
• (i) a consumer; or
• (ii) any voluntary consumer association registered under
any law for the time being in force; or
• (iii) the Central Government or any State Government; or
• (iv) the Central Authority; or
• (v) one or more consumers, where there are numerous
consumers having the same interest; or
• (vi) in case of death of a consumer, his legal heir or legal
representative; or
• (vii) in case of a consumer being a minor, his parent or
legal guardian;
 Complaint –section 2(6)
means any allegation in writing, made by a complainant
for obtaining any relief provided by or under this Act, that
—
• (i) an unfair contract or unfair trade practice or a
restrictive trade practice has been adopted by any trader
or service provider;
• (ii) the goods bought by him or agreed to be bought by
him suffer from one or more defects;
• (iii) the services hired or availed of or agreed to be hired
or availed of by him suffer from any deficiency;
Cont.
• (iv) a trader or a service provider, as the case may be, has charged for the
goods or for the services mentioned in the complaint, a price in excess of
the price—
• (a) fixed by or under any law for the time being in force; or
• (b) displayed on the goods or any package containing such goods; or
• (c) displayed on the price list exhibited by him by or under any law
for the time being in force; or
• (d) agreed between the parties;
• (v) the goods, which are hazardous to life and safety when used, are
being offered for sale to the public—
• (a) in contravention of standards relating to safety of such goods as
required to be complied with, by or under any law for the time being in
force;
• (b) where the trader knows that the goods so offered are unsafe to the
public;
Cont.
• vi) the services which are hazardous or likely to be hazardous to
life and safety of the public when used, are being offered by a
person who provides any service and who knows it to be injurious
to life and safety;
• (vii) a claim for product liability action lies against the product
manufacturer, product seller or product service provider, as the
case may be