Overview
Consumer Rights closes the economics course by turning from producers to the person at the other end of every transaction. It begins from a simple asymmetry: when we buy, the seller usually knows far more than we do about what is being sold, and often holds far more power. That asymmetry produces underweight and underquality goods, adulteration, misleading advertisements, and unsafe products. The chapter traces how the consumer movement arose out of dissatisfaction with these practices, how it grew in India from the 1960s through the 1970s and 1980s, and how it produced the Consumer Protection Act of 1986, known as COPRA, which set up a three-tier quasi-judicial machinery at district, state and national level so that a consumer could seek redressal without an ordinary civil suit. That machinery now operates under the Consumer Protection Act 2019, which replaced COPRA and added a Central Consumer Protection Authority. The heart of the chapter is the set of rights it enumerates: the right to safety, the right to be informed, which underlies the mandatory details printed on every packet and the Right to Information Act of 2005, the right to choose, the right to seek redressal, and the right to represent, which includes consumer education. It explains the logos of standardisation - ISI, Agmark and Hallmark - as devices that let a buyer judge quality without expertise. It ends soberly, noting that the consumer redressal process is becoming cumbersome and expensive, that most purchases leave no cash memo, and that enforcement of existing laws is weak, so that the movement still depends on active consumers who know and use their rights.
Learning Objectives
- Explain why a consumer is in a weak position in the marketplace and give examples of unfair practices.
- Trace the origin and growth of the consumer movement in India.
- State the main provisions of the Consumer Protection Act and describe the three-tier redressal machinery.
- Explain the right to safety and give an example of a product where it applies.
- Explain the right to be informed and describe the details a manufacturer must display.
- Explain how the Right to Information Act 2005 extends the right to be informed.
- Explain the right to choose with an example of its violation.
- Explain the right to seek redressal and describe how a complaint is made.
- Explain the right to represent and the importance of consumer education.
- Describe the ISI, Agmark and Hallmark logos and explain the purpose of standardisation.
- Assess the present state of the consumer movement in India and suggest what remains to be done.
Topics in this chapter
8 topics · tap a topic title to jump straight to it.
The Consumer in the Marketplace
An unequal exchange
We participate in the market both as producers and consumers. As producers of goods and services we could be working in any of the sectors. Consumers participate in the market when they purchase goods and services that they need. These are the final goods that people as consumers use.
The problem is that the two sides do not meet as equals. The seller usually knows a great deal more about the product than the buyer can, and in many markets a few large producers face a very large number of scattered individual consumers.
The unfair practices
- Sometimes traders indulge in unfair trade practices such as when shopkeepers weigh less than what they should, or when traders add charges that were not mentioned before, or when adulterated or defective goods are sold.
- Markets do not work in a fair manner when producers are few and powerful whereas consumers purchase in small amounts and are scattered.
- This happens especially when large companies are producing these goods. These companies with huge wealth, power and reach can manipulate the market in various ways. At times false information is passed on through the media, and other sources, to attract consumers.
The example of the baby food company
A company for years sold powder milk for babies all over the world as the most scientific product claiming this to be better than mother's milk. It took years of struggle before the company was forced to accept that it had been making false claims. Similarly, a long battle had to be fought with court cases to make cigarette manufacturing companies accept that their product could cause cancer.
Hence, there is a need for rules and regulations to ensure protection for consumers.
- Underweighing, undisclosed charges, adulteration and defective goods are the everyday unfair practices.
- Markets are unfair when producers are few and powerful and consumers are many, scattered and buying small amounts.
- A baby-food company claimed for years that powdered milk was better than mother's milk before being forced to admit the claim was false.
The Consumer Movement
How it began
The consumer movement arose out of dissatisfaction of the consumers as many unfair practices were being indulged in by the sellers. There was no legal system available to consumers to protect them from exploitation in the marketplace.
For a long time, when a consumer was not happy with a particular brand product or shopkeeper, it was usually up to the consumer to be careful while buying. It was presumed that it was the responsibility of consumers to be careful while buying a commodity or service.
Growth in India
It took many years for organisations in India, and around the world, to create awareness amongst people. This has also shifted the responsibility of ensuring quality of goods and services on to the sellers.
- In India, the consumer movement as a social force originated with the necessity of protecting and promoting the interests of consumers against unethical and unfair trade practices.
- Rampant food shortages, hoarding, black marketing, adulteration of food and edible oil gave birth to the consumer movement in an organised form in the 1960s.
- Till the 1970s, consumer organisations were largely engaged in writing articles and holding exhibitions. They formed consumer groups to look into the malpractices in ration shops and overcrowding in the road passenger transport.
- Recently, there has been an upsurge in the number of consumer groups who have been creating awareness amongst people.
The legal result
Because of all these efforts, the movement succeeded in bringing pressure on business firms as well as government to correct business conduct which may be unfair and against the interests of consumers at large.
A major step taken in 1986 by the Indian government was the enactment of the Consumer Protection Act 1986, popularly known as COPRA. This Act has since been replaced by the Consumer Protection Act, 2019, which continues the same three-tier redressal machinery and adds a Central Consumer Protection Authority to act against misleading advertisements and unfair trade practices.
- Food shortages, hoarding, black marketing and adulteration gave the movement its organised form in the 1960s.
- In the 1970s consumer organisations mainly wrote articles, held exhibitions and watched ration shops and passenger transport.
- COPRA 1986 was the legal breakthrough; the Consumer Protection Act 2019 now carries it forward.
The Right to Safety
The right
While using many goods and services, we as consumers have the right to be protected against the marketing of goods and delivery of services that are hazardous to life and property.
Producers need to strictly follow the required safety rules and regulations. There are many goods and services that we consume which require special attention to safety.
Where it matters most
- Pressure cookers have a safety valve which, if it is defective, can cause a serious accident.
- The manufacturers of the safety valve have to ensure high quality. Government rules are necessary to see that the manufacturers follow the standards.
- Electrical appliances, if of poor quality, can cause fire or electrocution.
- Medicines and food that are expired, adulterated or wrongly labelled endanger life directly.
Negligence by a service provider
The right to safety extends to services as well. When a doctor's or hospital's negligence causes harm, the consumer has a right to seek compensation. This is why the definition of consumer in the law covers not only goods bought but services hired or availed of.
- A defective safety valve in a pressure cooker can cause a serious accident - the standard textbook example.
- Electrical appliances of poor quality risk fire and electrocution.
- The right covers services too: medical negligence causing harm is a violation of the right to safety.
The Right to be Informed
What must be displayed
Consumers have the right to be informed about the particulars of goods and services that they purchase. Consumers can then complain and ask for compensation or replacement if the product proves to be defective in any manner.
When we buy any commodity, we find certain details given on the packing. These details are about ingredients used, price, batch number, date of manufacture, expiry date and address of the manufacturer. When we buy medicines, on the packets we find directions for proper use and information relating to side effects and risks associated with usage of that medicine.
Similarly, when we buy garments, we find instructions about washing.
Why it is a legal requirement
It is because of the consumer movement that the demand for the right to information has been taken up by the government. It has in recent times included the right to information about various services rendered by the government.
The Right to Information Act 2005
In October 2005, the Government of India enacted a law, popularly known as RTI Act, which ensures its citizens all the information about the functions of government departments.
If a government service or a public authority does not respond in the stipulated time, a person can use this Act to find out what is happening. This is the same law met in the Politics book as the model of a reform that empowers citizens rather than banning something.
- Mandatory details on a packet: ingredients, price, batch number, date of manufacture, expiry date and manufacturer's address.
- Medicine packets must also carry directions for use, side effects and risks; garments carry washing instructions.
- The RTI Act 2005 extends the right to be informed to the functioning of government departments.
The Right to Choose
The right
Any consumer who receives a service in whatever capacity, regardless of age, gender and nature of service, has the right to choose whether to continue to receive the service.
The example of tied selling
Suppose you want to buy toothpaste, and the shop owner says that he can sell the toothpaste only if you buy a toothbrush. If you are not interested in buying the brush your right to choice is denied.
Similarly, sometimes gas supply dealers insist that you have to buy the stove from them when you get a new gas connection. This too is a denial of the right to choose.
Why the right matters
The right to choose is the right that makes competition work for the buyer. If a seller can force a bundle on you, then the price you appear to pay for one item is not the real price, and comparison between sellers becomes impossible. Protecting choice therefore protects the market itself, not just the individual buyer.
- Being told you can buy toothpaste only if you also buy a toothbrush is the standard example of denial of choice.
- A gas dealer insisting that a new connection comes with a stove bought from him denies the same right.
- The right applies to services too - a consumer may choose whether to continue receiving a service.
The Right to Seek Redressal and the Three-Tier Machinery
The right
Consumers have the right to seek redressal against unfair trade practices and exploitation. If any damage is done to a consumer, she has the right to get compensation depending on the degree of damage.
There is a need to provide an easy and effective public system by which this can be done. Many a times, the seller is not willing to accept responsibility. In such circumstances, the consumer can approach the consumer court.
The three tiers
Under COPRA, and now under the Consumer Protection Act 2019, a three-tier quasi-judicial machinery at the district, state and national levels was set up for redressal of consumer disputes.
- The District Commission (earlier District Forum) deals with cases involving claims up to a specified amount.
- The State Commission deals with larger claims and hears appeals against District Commission orders.
- The National Commission deals with the largest claims and hears appeals from the State Commissions.
If a case is dismissed in the district level court, the consumer can also appeal in state and then in National level courts. Thus, the Act has enabled us as consumers to have the right to represent in the consumer courts.
How to complain
The consumer should have proof of purchase - a cash memo or bill - and, where possible, the packaging and guarantee or warranty card. A complaint can be filed by the consumer herself; a lawyer is not necessary. The process is meant to be simpler and cheaper than an ordinary civil suit.
- Three tiers: District Commission, State Commission and National Commission, with appeal upward at each level.
- The machinery is quasi-judicial - simpler and cheaper than an ordinary civil court, and a lawyer is not required.
- A cash memo or bill is the basic proof of purchase needed to file a complaint.
The Right to Represent and Consumer Education
The right to represent
The Consumer Protection Act has enabled us as consumers to have the right to represent in the consumer courts. Consumers have the right to be heard and to be assured that their interests will receive due consideration at appropriate forums.
Consumer awareness
The consumer redressal process is becoming cumbersome, expensive and time consuming. Many a times, consumers are required to engage lawyers. These cases require time for filing and attending the court proceedings etc.
In most purchases, cash memos are not issued, hence evidence is not easy to gather. Moreover, most purchases in the market are small retail sales. The existing laws also are not very clear on the issue of compensation to consumers injured by defective products.
Rules and regulations for workers
Similarly, the rules and regulations for working of markets are often not followed. Nevertheless, there has been an enactment of Consumer Protection Act, 2019, in place of the earlier COPRA 1986.
What is required of us
The enactment of COPRA has led to the setting up of separate departments of consumer affairs in central and state governments. The consumer movement in India has made some progress in terms of numbers of organised groups and their activities.
There are today more than 2,000 consumer groups in the country, of which only about 50-60 are well organised and recognised for their work. Consumer awareness is spreading but slowly. Also, the enforcement of laws that protect workers, especially in the unorganised sectors, is weak.
Hence, there is a need for stronger consumer movement. The consumer movement can be effective only with consumers' active involvement. It requires a voluntary effort and struggle involving the participation of one and all.
24 December is observed as the National Consumers' Day in India, because it was on this day that the Indian Parliament enacted the Consumer Protection Act in 1986.
- The redressal process is becoming cumbersome, expensive and time consuming, often requiring lawyers.
- Cash memos are not issued in most purchases, so evidence is hard to gather.
- Over 2,000 consumer groups exist but only 50-60 are well organised; 24 December is National Consumers' Day.
Standardisation: ISI, Agmark and Hallmark
Why logos exist
There are certain organisations that develop standards for goods and services. A consumer cannot test the purity of gold or the safety of a wire, so a mark is needed that a buyer can trust without expertise.
These logos and certification help consumers get assured of quality while purchasing the goods and services. The organisations that monitor and issue these certificates allow producers to use their logos provided they follow certain quality standards.
The three marks
- ISI - issued by the Bureau of Indian Standards (BIS), for industrial and consumer goods such as electrical appliances, cement, LPG cylinders and packaged drinking water.
- Agmark - for agricultural products such as cereals, pulses, spices, honey and edible oils.
- Hallmark - for the purity of gold jewellery, also administered by BIS.
Where certification is compulsory
While it is not mandatory for all the producers to follow the standards, it is mandatory for those products that affect the health and safety of consumers, such as LPG cylinders, packaged drinking water, cement and electrical appliances.
Notice how standardisation relates to the right to be informed. Both solve the same problem — the buyer's lack of knowledge — one by printing the facts on the packet, the other by guaranteeing them with a mark.
- ISI mark from the Bureau of Indian Standards, for industrial and consumer goods.
- Agmark for agricultural products; Hallmark for the purity of gold jewellery.
- Certification is voluntary in general but compulsory for products affecting health and safety, such as LPG cylinders and packaged drinking water.
Key Concepts
- Consumer
- A person who buys goods or hires or avails of services for consideration, and any user of such goods or services other than the buyer.
- Unfair trade practice
- Practices such as underweighing, adding undisclosed charges, adulteration, false claims and misleading advertisement.
- Adulteration
- Mixing an inferior or harmful substance into a product, especially food, so that the buyer receives less or worse than paid for.
- Consumer movement
- The organised social force that arose from consumer dissatisfaction and pressed business and government to correct unfair conduct.
- COPRA 1986
- The Consumer Protection Act 1986, which set up a three-tier quasi-judicial redressal machinery; replaced by the Consumer Protection Act 2019.
- Right to safety
- The right to be protected against the marketing of goods and delivery of services hazardous to life and property.
- Right to be informed
- The right to know the particulars of goods and services - ingredients, price, batch number, dates of manufacture and expiry, and the manufacturer's address.
- Right to Information Act 2005
- The law entitling citizens to information about the functioning of government departments.
- Right to choose
- The right of a consumer to decide what to buy and whether to continue receiving a service, free of conditions tying one purchase to another.
- Right to seek redressal
- The right to compensation against unfair trade practices and exploitation, through an easy and effective public system.
- Right to represent
- The right to be heard and to have one's interests receive due consideration at the appropriate forum, including a consumer court.
- District Commission
- The first tier of consumer redressal, hearing claims up to a specified value.
- State Commission
- The second tier, hearing larger claims and appeals from District Commissions.
- National Commission
- The highest tier, hearing the largest claims and appeals from State Commissions.
- ISI mark
- The certification of the Bureau of Indian Standards for industrial and consumer goods.
- Agmark
- The certification mark for agricultural products such as cereals, pulses, spices, honey and edible oils.
- Hallmark
- The certification mark for the purity of gold jewellery.
- National Consumers' Day
- 24 December, the day the Indian Parliament enacted the Consumer Protection Act in 1986.
Practice Questions
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Why are rules and regulations required in the marketplace to protect consumers? / उपभोक्ताओं की रक्षा के लिए बाजार में नियमों और विनियमों की आवश्यकता क्यों है?
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Rules are required because individual consumers often find themselves in a weak position; sellers may sell defective or adulterated goods, give less weight, charge more than the printed price or pass on false information, so regulation is needed to protect consumers from exploitation. / नियमों की आवश्यकता इसलिए है क्योंकि व्यक्तिगत उपभोक्ता अक्सर कमजोर स्थिति में होते हैं; विक्रेता दोषपूर्ण या मिलावटी वस्तुएँ बेच सकते हैं, कम तौल दे सकते हैं, छपी कीमत से अधिक वसूल सकते हैं या झूठी जानकारी दे सकते हैं, इसलिए उपभोक्ताओं को शोषण से बचाने के लिए विनियमन आवश्यक है।
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State the 'Right to Safety' as a consumer right. / उपभोक्ता अधिकार के रूप में 'सुरक्षा के अधिकार' को बताइए।
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The Right to Safety means consumers have the right to be protected against the marketing of goods and services that are hazardous to life and property, for example demanding quality and safety in goods like pressure cookers, gas cylinders and medicines. / सुरक्षा का अधिकार का अर्थ है कि उपभोक्ताओं को जीवन और संपत्ति के लिए हानिकारक वस्तुओं और सेवाओं के विपणन से सुरक्षा का अधिकार है, उदाहरण के लिए प्रेशर कुकर, गैस सिलेंडर और दवाओं जैसी वस्तुओं में गुणवत्ता और सुरक्षा की माँग करना।
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What is the COPRA, 1986, and why was it a significant step? / COPRA, 1986 क्या है और यह एक महत्वपूर्ण कदम क्यों था?
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COPRA is the Consumer Protection Act enacted by the Government of India in 1986. It was significant because it set up a three-tier judicial machinery (district, state and national consumer courts) for the redressal of consumer disputes, giving consumers a legal way to fight exploitation. / COPRA भारत सरकार द्वारा 1986 में अधिनियमित उपभोक्ता संरक्षण अधिनियम है। यह इसलिए महत्वपूर्ण था क्योंकि इसने उपभोक्ता विवादों के निवारण के लिए तीन-स्तरीय न्यायिक व्यवस्था (जिला, राज्य और राष्ट्रीय उपभोक्ता न्यायालय) स्थापित की, जिससे उपभोक्ताओं को शोषण से लड़ने का कानूनी मार्ग मिला।
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Explain the 'Right to be Informed' and how the date of expiry on a packet relates to it. / 'सूचना पाने के अधिकार' की व्याख्या कीजिए तथा पैकेट पर समाप्ति तिथि इससे कैसे संबंधित है।
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The Right to be Informed means consumers have the right to know details about the goods and services they buy, such as ingredients, price, quantity, batch number and date of expiry. Printing the date of expiry lets consumers know how long a product is safe to use and avoid harmful expired goods. / सूचना पाने के अधिकार का अर्थ है कि उपभोक्ताओं को खरीदी गई वस्तुओं और सेवाओं के बारे में जानकारी का अधिकार है, जैसे सामग्री, कीमत, मात्रा, बैच संख्या और समाप्ति तिथि। समाप्ति तिथि छापने से उपभोक्ता जान पाते हैं कि कोई उत्पाद कब तक उपयोग के लिए सुरक्षित है और हानिकारक समय-समाप्त वस्तुओं से बच सकते हैं।
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What are ISI, AGMARK and Hallmark, and what is their importance for consumers? / ISI, AGMARK और हॉलमार्क क्या हैं तथा उपभोक्ताओं के लिए इनका क्या महत्व है?
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These are quality certification logos: ISI for industrial goods like electrical appliances, AGMARK for agricultural products, and Hallmark for gold and silver jewellery. They assure consumers that the product meets prescribed quality standards, helping them make safe and reliable purchases. / ये गुणवत्ता प्रमाणन चिह्न हैं: ISI विद्युत उपकरण जैसी औद्योगिक वस्तुओं के लिए, AGMARK कृषि उत्पादों के लिए और हॉलमार्क सोने-चाँदी के आभूषणों के लिए। ये उपभोक्ताओं को आश्वस्त करते हैं कि उत्पाद निर्धारित गुणवत्ता मानकों को पूरा करता है, जिससे वे सुरक्षित और विश्वसनीय खरीदारी कर पाते हैं।
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Describe the three-tier system of consumer courts under COPRA and the value of claims each handles. / COPRA के अंतर्गत उपभोक्ता न्यायालयों की तीन-स्तरीय व्यवस्था तथा प्रत्येक द्वारा निपटाए जाने वाले दावों के मूल्य का वर्णन कीजिए।
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There are district level courts for claims up to a certain lower amount, state level courts for claims of an intermediate amount, and the national level court for the highest claims. A dissatisfied consumer can appeal from the district to the state and then to the national level court. / जिला स्तरीय न्यायालय एक निश्चित कम राशि तक के दावों के लिए, राज्य स्तरीय न्यायालय मध्यम राशि के दावों के लिए और राष्ट्रीय स्तरीय न्यायालय सबसे अधिक राशि के दावों के लिए होते हैं। असंतुष्ट उपभोक्ता जिला से राज्य और फिर राष्ट्रीय स्तर के न्यायालय में अपील कर सकता है।
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What is the 'Right to Seek Redressal'? Why is it important? / 'निवारण पाने का अधिकार' क्या है? यह क्यों महत्वपूर्ण है?
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The Right to Seek Redressal means consumers have the right to get compensation or relief against unfair trade practices or exploitation. It is important because it allows a consumer who has been cheated or supplied defective goods to approach consumer courts and obtain justice. / निवारण पाने का अधिकार का अर्थ है कि उपभोक्ताओं को अनुचित व्यापार प्रथाओं या शोषण के विरुद्ध मुआवजा या राहत पाने का अधिकार है। यह महत्वपूर्ण है क्योंकि यह ठगे गए या दोषपूर्ण वस्तु पाने वाले उपभोक्ता को उपभोक्ता न्यायालयों में जाकर न्याय प्राप्त करने में सक्षम बनाता है।
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Despite the consumer movement, what factors still limit consumer protection in India? / उपभोक्ता आंदोलन के बावजूद, भारत में कौन-से कारक अभी भी उपभोक्ता संरक्षण को सीमित करते हैं?
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Consumer redressal is often a costly and time-consuming process; most purchases in the unorganised sector occur without proper cash memos, making it hard to gather evidence; and many consumers, especially in rural areas, are still unaware of their rights, which weakens enforcement. / उपभोक्ता निवारण अक्सर महँगी और समय लेने वाली प्रक्रिया है; असंगठित क्षेत्र में अधिकांश खरीदारी उचित नकद रसीद के बिना होती है, जिससे साक्ष्य जुटाना कठिन हो जाता है; और कई उपभोक्ता, विशेषकर ग्रामीण क्षेत्रों में, अब भी अपने अधिकारों से अनजान हैं, जो प्रवर्तन को कमजोर करता है।
Related Laws & Principles
Explore allFoundational laws & principles behind this chapter. Each one opens a full page — what it says, why it matters, five practice questions and the mistakes to avoid.