Consumer Rights and Responsibilities

Consumer Rights:

  1. Right to safety:- Means the right to be protected from the marketing of goods and services that endanger life and property. The items and services acquired should not only suit their current requirements, but also their long-term interests. Consumers should insist on the quality of the items as well as the guarantee of the products and services before making a purchase. They should rather choose quality-marked items such as ISI, AGMARK, and so on.
  2. Right to choose:- Means the right to be guaranteed, whenever feasible, of access to a diverse range of products and services at a reasonable price. In the case of monopolies, it entails the right to expect good quality and service at a reasonable price. It also covers the right to fundamental goods and services. This is because the minority’s unfettered ability to choose might imply a rejection of the majority’s fair share. This right is better exercised in a competitive market when a wide range of items are accessible at reasonable costs.
  3. Right to be informed:- Means the customer has the right to be informed about the quality, amount, potency, purity, standard, and price of goods in order to defend themselves from unfair commercial practises. Before making a choice or decision, consumers should insist on receiving all available information about the product or service. This will allow him to behave intelligently and responsibly, as well as avoid falling victim to high-pressure marketing methods.
  4. Right to consumer education:- The right to gain the information and skills necessary to be an educated consumer throughout one’s life. Consumer ignorance, particularly among rural customers, is largely to blame for their exploitation. They should be aware of their rights and should exercise them. Only then can successful consumer protection be achieved.
  5. Right to be heard:- This means that the interests of consumers will be taken into account in relevant forums. It also involves the right to be represented in different forums established to examine the welfare of consumers. Consumers should create non-political and non-commercial consumer groups that may be represented in various consumer committees formed by the government and other entities.
  6. Right to Seek redressal:- Means the right to seek remedy for unjust trade practises or unethical consumer exploitation. It also includes the consumer’s right to a fair resolution of legitimate issues. Consumers must file a complaint if they have legitimate issues. Many times, their complaint may be of minor importance, but its influence on society as a whole may be significant. They can also seek resolution of their concerns via consumer organisations.
  7. Consumer Protection Act:- An Act to provide for the protection of consumers’ interests and, for that purpose, to create agencies for the prompt and effective administration and resolution of consumer disputes, as well as for matters associated therewith.” (From the Consumer Protection Act of 2019.) “An Act to provide for greater consumer protection and to make provision for the formation of consumer councils and other agencies for the resolution of consumer disputes and for issues connected therewith.”(From the Consumer Protection Act of 1986.) The Consumer Protection Act of 1986 aims to promote and defend customers’ interests against inadequacies and faults in goods or services. It also aims to protect consumers’ rights against unfair or restrictive trade practises. This act was passed in the Lok Sabha on December 9, 1986, and the Rajya Sabha on December 10, 1986, and it was signed by the President of India on December 24, 1986, and it was published in the Gazette of India on December 26, 1986.

Consumer Responsibilities:

  1. Ask Yourself!:-
  • Have you had any issues as a consumer?
  • Have you ever complained about an issue like this?
  • Do you aware that you may seek the help of a consumer organization to safeguard your interests?

2. Be Critically Aware:- The responsibility to be more alert and to question more – about prices, about quantity and quality of goods bought and services used.

3. Be Involved:- The obligation to be forceful – to guarantee that you, as a customer, get a fair bargain. Remember that if you remain passive, you will most likely be exploited.

4. Be Organized:- The duty to join hands and raise one’s voice as a customer; to fight as a group and to build the power and influence necessary to promote and safeguard consumer interests.

5. Practice Sustainable Consumption:- The responsibility to be aware of the impact of your consumption on other citizens, especially the disadvantaged or powerless groups; and to consume based on needs – not wants.

6. Be Responsible to the Environment:- The obligation to be aware of and comprehend the environmental repercussions of our consumption. We must acknowledge our personal and social duty to conserve natural resources and maintain the environment for future generations.

PROTECTION OF INTEREST OF HOME BUYERS

The law on real estate has not been properly organisaed in the past, which has left the home buyers in lurch, as they ended up paying their hard earned money in the hands of fraudulent builders. We analyse various options under prevailing laws: 

  • The Real Estate Regulation Act, 2016
  • The Insolvency and Bankruptcy Code, 2016
  • The Consumer Protection Act, 1986

PROVISIONS UNDER THE REAL ESTATE REGULATION ACT, 2016

RERA seeks to bring clarity and fair practices that would protect the interest of buyers and also impose penalties on errant builders. It enhances certain norms to enhance transparency in real estate sector. Gist of major benefits of RERA are as follows:

  • Standardized carpet area– in the absence of standard definition of carpet area, the builders followed biased policies and calculation method to their advantage. Sec 2(k) now defines carpet area to mean the net usable floor area.
  • Reduces the risk of insolvency– Earlier builders were free to divert the funds raised from one project to another or anywhere, in the absence of no end-use monitoring norms. But now, the builder is required to deposit 70% of the amount realized in a separated bank account to be withdrawn as per completion of project, and based on certificate of a civil engineer, architect or Chartered Accountant.
  • Rights in case of defected possession – in case of any structural defect or any defect in workmanship, quality, provisions or service is discovered within 5 years after the possession, such defect will be rectified by the builder at no extra cost within 30 days. Similarly, buyers have been given rights in case of false promises leading to refund + interest and compensation.  

PROVISIONS UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

Under the code the creditors are categorized into two types: Financial or Operational. Financial creditors includes person who have lent money to the debtor against the payment of interest, whereas Operational Creditors includes person who have established certain types of relationship with the debtor company such as the provision of goods and services, employment or Govt. dues. Therefore prior to the amendment “Home buyers” were treated as an orphan as, they were considered to be neither financial creditors nor operational creditors. The delay or default could however be intentional or unintentional such as funding issues, demand and supply situation, developer’s negligence, delay in land clearance, labour availability, ground water, land. Now after this amendment, the allottee1 of home buyers are termed as Financial Creditors.

The sums paid by the Home Buyers to a builder will be considered as financial debt. This enables home buyers to file petition u/s 7 of the code to start insolvency proceedings against a defaulting builder company. Further, according to section 238 of the IBC, if there is any inconsistency between IBC and another law then the IBC will prevail. In the light of same provision both the enactments i.e. RERA and IBC shall be read harmoniously to provide relief to the homebuyers and in case of inconsistency, IBC shall prevail over RERA enabling the homebuyers to approach NCLT without any hesitation.

PROVISIONS UNDER THE CONSUMER PROTECTION ACT, 1986

The widely used Consumer Protection Act had been best choice for the consumers to seek redressal of their disputes. However, the pecuniary jurisdiction has always been a matter of debate. Sometimes consumer courts were found to be highly burdened with the complaints, resulting into unreasonable delay in disposal of complaints.  This delay has not encouraged consumers to take up their disputes. The tendency of consumers is that whenever there is any urgency there must be fast remedy. The delay practice has made consumer courts at par with the civil courts. The object of creating special forum under special law has been defeated. Under the law exploring multiple options at a same time is not allowed, unless the additional remedy is a criminal proceeding starting from registration of FIR against the respondent for having committed a criminal offence. 

Pecuniary jurisdiction: District commission will have jurisdiction over the cases where the value of goods and services and the compensation claimed does not exceed Rs. 20 lakhs. State Commission shall have jurisdiction if value exceeds Rs. 20 lakhs but does not exceed 1 crore[1]. The National Commission will have jurisdiction where value exceeds Rs. 1 Crore.[2] However, with the amended Act, the jurisdiction has increased to Rs. 1 Crore, and 10 Crore as against Rs.

20 lakhs and Rs. 1 Crore respectively. 

Arbitration: An alternative

The consumers, particularly the home buyers started looking at arbitration as an alternative remedy. Arbitration is certainly a fast remedy and has proved to be effective in most of the cases. But in respect to disputes of home buyers, the arbitration clause is so twisted in favour of builders that the innocent home buyers cannot have say in appointment of arbitrator. The builders will usually appoint an arbitrator of their own choice; hence the controlling power is vested with the builder. Although, there has been an amendment in the Arbitration Act, 2015. The amendment has inserted 7th schedule which specifically prohibits appointment of related party as Arbitrator. So, be careful while drafting such clauses on Arbitration so that the contract can be enforced. This is generally a myth that the appointing party shall conduct the affairs of arbitration. Whereas the conduct of Arbitrator is regulated and the law puts various checks and balance so that the arbitrator does not deliver biased orders, in addition to decision of arbitrator called arbitral award can be challenged in certain situations, and if found week on the given parameters, the award can be set aside and not binding.

Therefore, with great initiatives of the current Govt. to promulgate new laws, buyers are expected to get effective remedies.  


[1] Section 17, Consumer Protection Act, 1986.

[2] Section 21, Consumer Protection Act, 1986.

Consumer Protection Act, 2019 and progress towards One Nation One Ration Card

Union Minister for Consumer Affairs, Food & Public Distribution, Shri Ram Vilas Paswan today listed the achievements and initiatives of the Ministry of Consumer Affairs, Food & Public Distribution during the last one year. The biggest achievement is the Government has been ensuring transport and distribution of free food grains to the people during the lockdown period.

Shri Paswan said the enactment of Consumer Protection Act, 2019, CWC achieves highest ever turnover, increase in the authorized capital of FCI from Rs.3,500 crore to Rs.10,000 crore and the march towards One Nation One Ration Card are among notable achievements of the Ministry during the last one year of the Government.

Food grain distribution

Shri Paswan said sufficient quantity of food grains is available in buffer stock to fulfill the nation’s increased demand during the COVID19 crisis. The Minister informed that as on 28.5.2020, FCI currently has 272.29 LMT rice and 479.40 LMT wheat. Hence, a total of 751.69 LMT food grain stock is available (excluding the ongoing purchase of wheat and paddy, which have not yet reached the godown).

He said that since the lockdown was announced on 24th March, 2020, about 101.81 LMT food grains have been lifted and transported through 3636 rail rakes. Apart from the rail route, transportation was also done through roads and waterways. A total of 213.02 LMT has been transported. 12,000 MT food grains was transported through 12 ships. Total 10.37 LMT food grains have been transported to the North-Eastern States.

He said the FCI and NAFED have undertaken a massive exercise transporting food grains to States and UTs for distribution under Atmanirbhar scheme, PM-GKAY and NFSA.

Under PMGKAY, for 3 months a total of 104.4 LMT rice and 15.6 LMT wheat is required of which 84.95 LMT rice and 12.91 LMT wheat have been lifted by various States and UTs. A total of 97.87 LMT food grain has been lifted till 29.5.2020. Along with additional food grains, 1 Kg Pulses/Dal per family per month are being given free-of-cost to all 80 crore NFSA beneficiaries for a period of three months April to June 2020 across all States/UTs. Shri Paswan said the total requirement for pulses for three months is 5.87 LMT. So far, 4.77 LMT pulses have been dispatched while 3.80 LMT Pulses have reached the States/UTs. As on 29.5.2020, 1.75 LMT pulses have been distributed by the States/UTs.

Shri Paswan said that under NFSA and other welfare schemes of the Government of India total 55 LMT food grains are required for one month. The Department has already delegated the power to Food Corporation of India (FCI) to grant extension to States/UTs for lifting the unlifted quantity to further six months i.e upto June, 2020 as 1st extension and while for the North-east  States and J & K  as 2nd extension as measures to improve offtake of foodgrain under TPDS/NFSA .

Under the OMSS, the Government liberalized the sale of food grains by the FCI to states and NGOs by offering Wheat and rice at a subsidized rate.

Shri Paswan said that States/UTs have already lifted 2.06 LMT food grains under Atma Nirbhar Bharat package. The distribution has started and shall be completed on schedule.

One Nation One Card

Shri Paswan said national portability of NFSA ration cards holders has been introduced under “One Nation One Ration Card” plan . He said the Ministry is aiming to achieve 100% seeding of ration cards with Aadhar under One Nation One Ration Card scheme by January 2021.

Centrally Sponsored Pilot Scheme on “Fortification of Rice and its Distribution under PDS

Informing about this scheme, Shri Paswan said that a total budget outlay of Centrally Sponsored Pilot Scheme on “Fortification of Rice and its Distribution under Public Distribution System” has been revised to Rs.174.64 Crore from earlier outlay of Rs. 147.61 Crore. The Pilot Scheme is to focus on 15 Districts, preferably 1 District per State.

Increase in the authorized capital of Food Corporation of India (FCI)

The Minister informed that the Cabinet Committee on Economic Affairs (CCEA) in its meeting held on 02.12.2019 approved the proposal of increase in the authorized capital of FCI from Rs.3,500 crore to Rs.10,000 crore.

Central Warehousing Corporation (CWC) achieves highest turnover

Shri Paswan said the Central Warehousing Corporation (CWC) has achieved highest ever turnover of about Rs 1710 crore during 2019-20. Government of India has received Rs 35.77 crores out of the total dividend of Rs 64.98 crore.

Sugar Development Fund

Shri Paswan said loan applications involving amount of Rs.125,05.34 lakhs were approved and an amount of Rs.188,58.91 lakhs loan was disbursed to 15 sugar factories during 01.04.2019 to 31.03.2020. A web-portal has also been launched w.e.f. 28.10.2019 for online submission of loan applications for availing various loans provided under Sugar Development Fund by the Sugar Factories.

Diversion of excess sugar to ethanol

The Minister informed that the Government has also allowed production of ethanol from sugar and sugar syrup for current ethanol supply year 2019-20 (December, 2019 – November, 2020) in order to meet the increased demand for ethyl alcohol to check the spread of Corona virus.

Production of Hand-sanitizers to fight against Covid-19

Shri Paswan said 165 distilleries and 962 independent manufacturers were given licenses to produce hand-sanitizers across the country, which has resulted in production of 87,20,262 litres of hand-sanitizers (as on 11.5.2020).

Face Mask and hand sanitizer manufacturing

Shri Paswan said that in wake Covid-19, Bureau of Indian Standards (BIS) allowed the grant of license to the manufacturers of FFP2 masks as per IS 9473:2002 (which are technically equivalent to N95 masks), with relaxation regarding availability of in-house testing facilities.

Patent to National Sugar Institute

The Minister said that the patent has been granted to National Sugar Institute (NSI) Kanpur for a new process on Sugarcane Juice Clarification to obtain Sulphur-less sugar.

Consumer Protection Bill, 2019

Consumer Protection Bill, 2019 was passed in Lok Sabha and by Rajya Sabha on 30.07.2019 &  06.08.2019 respectively. The President gave his assent to the Consumer Protection Bill 2019 and the Consumer Protection Act, 2019 was published on the official gazette on 09.08.2019.

The Legal Metrology (National Standards) Rules, 2011

The Legal Metrology (National Standards) Rules, 2011 were amended to include new definitions of International System of Units (SI units) of weights and measures as per the definitions adopted by International Bureau of Weights and Measures (BIPM) vide GSR 474 (E) dated 5th July, 2019

Hallmarking

The Minister said that the hallmarking for Gold jewellery and artefacts has been made mandatory in the country vide notification on 15 January 2020 giving a period of one year for implementation.

National Laboratory Directory

He also informed the media that National Laboratory Directory has been launched by Bureau of Indian Standards containing data of more than 4000 laboratories with location and product-wise testing facility.