Chapter 6: CONSUMER PROTECTION LAWS AFFECTING HOTELS

Objective:

To understand the right of consumer protected under Consumer Protection Act India 1986 

Consumer Protection Councils

Consumer Disputes Redressal Agencies

 Key words

·         Consumer

·         Complainant

·         Deficiency

·         Goods

·         service

I. Introduction

The Consumer Protection Act 1986 is a social welfare legislation which was enacted as a result of widespread consumer protection movement. The main object of the legislature in the enactment of this act is to provide for the better protection of the interests of the consumer and to make provisions for establishment of consumer councils and other authorities for settlement of consumer disputes and matter therewith connected.

In order to promote and protect the rights and interests of consumers, quasi judicial machinery is sought to be set up at district, state and central levels. These quasi judicial bodies have to observe the principles of natural justice and have been empowered to give reliefs, of specific nature and also to impose penalties for non compliance of the orders given by such bodies.

The main object of these bodies is to provide speedy and simple redressal to consumer disputes. It is one of the benevolent pieces of legislation intended to protect the consumers at large from exploitation.

UN GUIDELINES FOR THE CONSUMER PROTECTION

Protect from hazard to health & safety;

Promote & protect economic interests;

Provide adequate information for informed choice;

Consumer education;

Provide effective redress—formal and informal procedures;

Freedom to form groups & present views in decision-making affecting consumers;

  

ii. How the act was enacted? 

The act was passed in Lok Sabha on 9th December,1986 and Rajya Sabha on 10th December, 1986 and assented by the President of India on 24th December, 1986 and was published in the Gazette of India on 26th December, 1986.

This act was enacted in the 37th year of the Republic of India and was amended from time to time in the following years i.e. 1991, 1993 and 2002.

 

iii. The Act - Consumer Protection Act India 1986 

An act to provide for better protection of the interests of consumers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consumer disputes and for matters connected therewith.

  Section 2 of the Act lays down the various definitions under the act out of which certain important definitions are as under:

 Section 2 sub section 1 sub clause (b): “Complainant” 

 Section 2 sub section 1 sub clause (c): “Complaint”

 Section 2 sub section 1 sub clause (d): “Consumer”

 Section 2 sub section 1 sub clause (g): “deficiency”

 Section 2 sub section 1 sub clause (i): “goods”

 Section 2 sub section 1 sub clause (n): “Restrictive trade practice”

 Section 2 sub section 1 sub clause (o): “service”

 Section 2 sub section 1 sub clause (r): “unfair trade practice”

  

iv. Definitions

Who is a consumer?

All of us are consumers of goods and services.

A consumer under the act is:

“One, who buys any goods, hires any service or services for consideration which has been paid or promised or partly paid and partly promised or under any system of deferred payment.

Note: A person is not a consumer if he purchases goods for commercial purpose or resale purpose. However, a person is consumer if he purchases goods for the purpose of earning his livelihood by means of self-employment.

Many acts enacted earlier are in force, whether enforced or not. Under any of these acts, one can seek redressal through the courts of law. But, ‘Consumer Protection Act’ (Act 68 of 1986) provides for redressal through specially-constituted agencies at different levels

A glimpse of the provisions is presented herein below

1.      It provides for the notification of Central and State Consumer Protection Councils by the respective governments with a view to protect the rights of consumers such as,

·         the right to be protected (against hazardous goods)

·         the right to be informed (about quality, quantity, against unfair trade practices, etc)

·         the right to be heard (of complaints),

·         the right to seek redressal (through appropriate agencies), and

·         the right to consumer education

2.      To promote and protect the rights of the consumers with regard to defective goods, deficient services, overcharging or any unfair trade practices It includes false statement on quantity or grade of goods/services, false claims to sponsorship, making false and misleading promises on the articles, false projection of the needs for or usefulness of goods/services, giving warranty on products not based on adequate or proper test, and the like, whether made orally or in writing or by visible representation.

Two kinds of consumer under the Act

Consumer of goods

Buys or agrees to buy goods

Any user of such goods

Consumer of services

Hires or avails any services

Any beneficiary of such service

  

CONSUMER AS DEFINED U/SEC 2(1) (d) OF THE ACT:

“Consumer” means any person who-

Buys any goods for a consideration which has been paid or promised or partly paid and partly promised, under any system of deferred payment, and includes any user of such goods 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.

Explanation: “commercial purpose” does not include use by a consumer of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self-employment;]

DEFINITON OF CONSUMER COVERS

·         One who buys goods for a consideration for personal use

·         One who obtains goods on hire purchase or lease

·         One who uses such goods with the permission of buyer of goods

·         One who buys goods exclusively for purpose of earning his lively hood as self employment

·         One who hire/ avails of any services for a consideration

·         One who uses the services with permission of person who has hired the services

·         One who obtains the services on deferred payment basis

Why the Consumer Protect Act?

Because a consumer has a RIGHT to

·         SAFETY

·         INFORMATION

·         CHOOSE

·         BEHEARD

·         REDRESSAL

·         CONSUMER EDUCATION

CONSUMERS NEED PROTECTION AGAINST

·         Unfair trade practice

·         Restrictive trade practice

·         Defects

·         Deficiencies

UNFAIR TRADE PRACTICE

·         Adopting unfair methods or deception to promote sale, use or supply of goods or services.

·         Misleading public about price (e.g. bargain price when it is not so).

·         Charging above MRP printed.

·         Misleading public about another’s goods or services.

·         Falsely claiming a sponsorship, approval or affiliation.

·         Offering misleading warranty or guarantee.

CONSUMERS NEED PROTECTION AGAINST

·         RESTRICTIVE TRADE PRACTICE

·    Price fixing or output restraint: delivery/flow of supplies to impose unjustified costs/restrictions on consumers.

·       Collusive tendering; market fixing territorially among competing suppliers, depriving consumers of free choice, fair competition.

·         Supplying only to particular distributors or on condition of sale only within a territory.

·         Delaying in supplying goods/services leading to rise in price.

·        Requiring a consumer to buy/hire any goods or services as a pre-condition for buying/hiring other goods or services.

         CONSUMERS NEED PROTECTION AGAINST

DEFECTS

·         Any fault, imperfection or shortcoming in the quality, quantity, potency, purity or standard which is required to be maintained by or under any law for the time being in force or under any contract express or implied or as is claimed by the trader in any manner whatsoever in relation to any goods.

DEFICIENCY

·         Any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service.

 Where should one complain?

A. If the value of the services and compensation asked for is a. < Rs 5 lakhs then one can complain to the District Forum at the District Headquarter, b. > 5 lakhs and within Rs. 20 lakh the complaint can be filed before the concerned State Commission at the State Capital. c. >20 lakhs the complaint can be filed before the National Commission. If the consumer is not satisfied with the Judgment of the District Forum, he/she can file and appeal to the State Commission. Similarly, appeal against an order of a State Commission lies before the National Commission. Appeal against an order of the National Commission has to be filed before the Supreme Court of India.

 What is method of filing a complaint?

A. A complaint shall be instituted in the District Forum within the local limits of whose jurisdiction the opposite party (or any one of the opposite parties where there are more than one) or the defendant actually and voluntarily resides or carries on business, or has a branch office or personally works for gain at the time of institution of the complaint provided that the other opposite party/parties acquiescence in such institution or the permission of the Forum is obtained in respect of such opposite parties; or the cause of action arises, wholly or in part.

 Who can a file a complaint?

·         A consumer (As above)

·         Any registered voluntary consumer organization

·         The Central Government

·         The State Government

When can a complaint be filed?

Under the Act, a complaint can be made in writing in the following circumstances:

·         If you have suffered loss or damage as a result of any unfair trade practices adopted by the trader.

·         If the services hired/availed of suffer from deficiencies in any respect.

·         If you have been charged a price in excess of the price displayed or fixed by or under any law for the time being in force.

·         If, the goods hazardous to life and safety, when used.

How can you file?

The complaint is to be filed within two years from the date on which cause of action has arisen

There is no fee for filing a complaint. Even an affidavit does not need stamp papers. A complaint can be sent by post or presented in person by complaint or his authorized agent.

Usually the Forums Require 3-5 copies of complaint.

What information should a complaint contain?

Complaint should contain the following information:

·         Name and complete address of complainant

·         Name and complete address of the opposite party or parties as the case may be.

·         Date of purchase/service obtained.

·         Amount paid for consideration.

·         Items of goods with quantities/nature of service.

·         Whether the complaint relate to unfair trade practice/defective goods’ deficient service/charging excess price.

·         Copies of bills/vouchers/receipts and copies of correspondence made, if any.

·         The relief sought-Under the Act.

 Remedies

The forums/Commissions can order the following relief:

·         Removal of defects from the goods

·         Replacement of the goods

·         Refund of the price paid.

·         Award of compensation for the loss or injury suffered.

·         Removal of defects or deficiencies in the services.

·         Discontinuance of unfair trade practices/restrictive trade practices and directing not repeating them.

·         Withdrawal of the hazardous foods from being offered for sale.

·         Award for adequate costs to practice.

Appeals against

District Forum ————– Within 30 days —— In State Commission

State Commission ——— within 30 days —— National Commission

National Commission —— within 30 days —— Supreme Court

There is no fee for filing appeals in the State and National commissions.

Procedure is the same as that complaint except that the application has to be accompanied by the copies of the orders appealed against with reasons for filing appeals.

BENEFITS & RELIEFS

Benefit

Disposal within 90 days

No adjournment shall ordinarily be granted - Speedy trial.

Relief

Removal of defects in goods or deficiency in services.

Replacement of defective goods.

Refund against defective goods or deficient services.

Compensation.

Prohibition on sale of hazardous goods.