UNIT 20 LIMITATIONS OF CONSUMER 1

PROTECTION ACT, 1986 A

Structure

20.0 Objectives

20.1 Introduction

20.2 Limitations of the Act and Difficulties in its Implementation

20.3 Suggestions for Amendments in the Act and Improvements in its Enforcement and Implementation

20.4 Let Us Sum Up

20.5 Key Words

20.6 Some Useful Books

20.7 Answers to Check Your Progress

After studying this unit, you should be able to:

know the deficiencies in the Consumer Protection Act

appreciate the practical difficulties beiilg encountered in implementation of the Act

know the possible amendments in the Act, and

know how the difficulties h the execution of the Act can be overcome.

20.1 INTRODUCTION

NO doubt, Consumer Protection Act, 1986 is one of the World's most outstanding and simple enactments of our Parliament. Not many countries have a law that is so simple.

Before the enactment of the Consumer Protection Act, 1986, there existed certain enactments which protected the consumers only in an indirect way. Some of these Acts you have already studied.

Some of these are; Prevention of Food Adulteration Act, Magic Remedies Act, Weights and Measures Act, Essential Commodities Act. Under these laws the guilty ones are punished, but no direct relief is available to the consumers.

Here is the Consumer Protection Act, 1986, which provides relief by way of compensation to the consumer of goods and services. A simple Act indeed. It is an exclusive legislation for the protection of Consumer's interests. It was brought into force from September 1, 1987. The Act was amended in 1993, enlarging its scope. The Act meets most of the demands of the consumer activists. No doubt, it will go a long way in giving a boost to the consumer movement in the country. But, still there is much to be done in this direction. A close scrutiny reveals many limitations which will render it incapable of affording the harassed consumer the protection he sorely needs. Also, there are some problems in the implementation of the Act.

20.2 LIMITATIONS OF THE ACT AND DIFFICULTIES IN

The Consumer Protection Act, 1986, is now in operation for more than a decade. The Act was amended in 1993 for enlarging its scope. However, there are certain shortcomings in the Act. There are :

i) Presently, the position is that only those services come within this Act for which specific payment is made, such as electricity, telephones, banking, etc. Thus the doctors as well

as hospitals including those where treatment is given free such as government hospitals do not come within the ambit of the Act.

Also, the mandatory civil services, such as sanitation, water supply, etc. provided by the State or local authorities are not covered by the Act.

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The Government cannot remain a silent spectator to the sorry state of affairs in the government hospitals. The government hospitals doctors have failed to improve themselves in extending satisfactory services to the public.

The Consumer Protection (Amendment) Act, 1993 incorporated two clauses regarding supply of harmdous goods, but it does not in~pose a strict liability on those who supply such goods.

Further, the consumer Protection Act, 1986, does not give any definition of safety requirements and permitted hazard levels. Whatever safety regulations are dready prescribed under some law or the other would have to he gone into as to whether they have been violated or not. In fact, the Act itself should incorporate certain product safeties requirements.

Under the Act, a consumer can seek redressal only he has suffered a loss on a damage as a result of the unfair trade practice or deficiency in service or the unfair trade practices resorted to by a trader. However, the per se rule is not invoked. The per se rule ensures that any act or practice which prima facie appears to be unfair shall be regarded as unfair and against consumer interest as such, pending its justifications by the opposite party.

The Act does not empower the Consumer Redressal Fora to issue either interim injunction, or "case and desist orders". These powcrs are vested in the Monopolies and Restrictive Trade Practices Commission under the Monopolies and Restrictive Trade Practices Act, 1969.

The Act docs not empower the Consumer Redressal Forums to take up cases slto rnm. The Monopolies and Restrictive Trade Practices Act, 1969 empowers and M.R.T.P. Commissions to inquire into any unfair practices upon its own knowledge or information.

The Act does not empower consumer fora to publisll the names of manufacturers, traders, and dealers whose goods are found to be hazardous to public safety. This empowerment, if made, will work as a deterrent to the erring business community and make the consumers informed.

The Act does not permit a consumer to lodge a complaint'with the Consumer Fora if a alternative remedy is available under some other law.

The Consumer Protection Act, 1986 clearly lays down that its provisions are in addition to and not in derogation of any other law for the time being in force.

In many cases of complaints brought before the consumer forums, the complainants were directed to seek relief in a Civil Court, on the ground that the complaints were of such a nature that they involved recording of voluminous evidence and expert opinion. The mere fact that witnesses may have to be examined and their cross-examination may also be necessary carinot by itself a valid ground for refusing adjudication of a dispute before the Consumer Courts.

Thus Consumer grievances redressal agencies are evading cases of complex nature on the specious plea that the matter could into be disposed within the time frame.

The Act does not impose liability on the chief executive, manager or director where an offense is shown to have been committed by an organisation.

The Act specifies a time frame within which the dispute is to be disposed of. The period specified is 90 days, but the actual time taken is much longer. In some cases, the complainants waited for about two years, attended the Consumer Courts several times before they were formed that the Courts would not be able to handle their cases.

One of the reasons for not adhering to this time frame is piling up a cases. Secondly the court is under obligation to straight away send the complaint to the other party for reply. The court does into find out whether the complaint falls within the scope of the Act and, therefore, should it be pursued or not. The reason for not adhering to the time frame is

Lilnltationr d the C-mer PratecHoa Act, 1986

Consumer Protection Act because of a rider to thc :ffect, included in the Consumer Protection Rules : "As far as possible".

The quick relief, as is expected under the Consumer Protection Act, 1986, should be ensured. Under the Act, it is expected that there will not olily be an effective and

i meaningful remedy made available to the consumer, but also, there will be a speedy remedy. Delay defeats justice. As the consumer movement is catching up momentum and strength, it is becoming difficult of the Redressal Fora to dispose of the cases coming before them.

If the Forums take a long time, they will also become just ordinary civil courts. Cases are piling up before the Forums also. In such a situation, one of the main objectives of the enactment will be defeated.

xi) It has been observed that there is a rift between judicial and non-judicial member of the consumer courts. This is growing day by day and threatening of affect the functioning of these quasi-judicial bodies. The non-judicial members feel that they are accorded second class status' by the Presidents or judicial member. They want that the Presidents of Consumer courts should treat them as their equals.

There is a vast gap between the emoluments of judicial and non-judicial members. The non-judicial members. The non judicial memhsrs~~ant that the government should follow a policy of equal pay for equal pay for equal work'.

The non judicial members feel frustrated as their role as adjudicators was being ignored. In any case the Presidents and the members are expected to play an equal role in the redress process.

The non judicial members selected to work on the benches of these courts are not competent. They do not get adequate compensation. Also they complain that they are completely ignored by the Presidents, who do not even extend the courtesy of consulting them before writing the orders.

The presence of non judicial members was expected to give an air of informality to the consumer courts and keep the entire procedure before them simple and short. However, this has not happened. The non judicial members of Consumer FORA hold the Presidents and lawyers jointly responsible for this state of affairs.

The misunderstanding between judicial and non-judicial members stem from the fact that judicial members are former judges who have vast experience in the field. In sharp contrast, niany of the non-judicial members would have had no exposure to these kind 01

Redressal Forums and find it difficult, at least initially, to cope with the work. But over a

period of time, they find that they have no role to play to express a contrary view or write a dissenting judgement.

Another problem is that quite a few members are appointed not purely on the basis of merit, but on other - mostly political consideration. Therefore, many non-judicial members are 'useless', 'good for nothing'. Therefore, the judicial members are mentally not prepared to accept such type of members as equal partners in the process of dispensing consumer justice.

xii) The Act concedes six rights of consumers viz. right to choice; right to safety; right to be informed; right to be heard; right to redress; and right to consumer education. But these

. rights have not been made justiciable.

xiii) The Act completely ignores the right of consumers to a healthy environment. It acknowledges only six rights of the COPS~:~~LC~S as are recognised by the international

'n:C118. organisation of consumer 1. '

xiv) The Act is silent on the question of storage of commodities. Many a time this becomes the more important issue than even the manufacturing of the goods themselves.

xi) The Consumer redressal agencies do not have requisite infrastructure; as a result they are hamstrung functioning effectively.

xvi) A major problem arising practically every where is that of execution of the orders passed Limitations of the Consumer

by the Consumer Courts. In a large number of cases there are defaults in compliance with Protection A C ~ , 1986

the orders. There are cases where consumer courts have resorted to issue of warrants to the defaulting parties. Cases have been taken to High Courts through writ petitions challenging the validity of issue of warrants (including non-bailable warrants).

An important issue relating to the execution of the orders is that the consumer courts have to depend on the Civil Courts for the execution of the orders or on the Criminal Courts when cases are referred for service of warrants. These procedures involve frustrating delays.

xvii) Experience of functioning of consumer courts by and large has been that the organisations against which decision is given by the Court, including organisations such as electric supply company or banks, there is almost invariably a tendency on its part to file an appeal. This adds to the problems of the consumer and inevitably delays the application of sought remedy and payment of adjudicated compensation.

In a large number of cases, when the remedy of appeal is exhausted, the organisatior very often resorts to the strategy of filing a 'revision' petition before the Nation; Commission. This further delays the award of remedy and compensation.

In some cases the organisations go even further and file appeals before the Supreme Court against decision of the National Commission.

Not wily that. The existing procedure provides opportunity to ask for condonation of delay in submission oE appeals.

Whenever a complaint is lodged by a consumer and thereafter the Courts sends the Complaint to the organisation or the trader for defect in the product, or deficiency in service or for unfair trade practice, the respondent engages a lawyer. The spirit of the Act all along has been that it wili r.r?t be lost in the wranglings of the lawyers as in Civil and Criminal Courts.

Another serious problems <-a d by intermediary or lawyers is that of adjournments. Quite often the cases are adjc . 'led on the demand of lawyers, to suit their convenience.

Check Your Progress 1

Note : i) Use the space below for yuu* .-nswers.

ii) Check your progress with the model answers given at the end of the unit.

1) Whether \he following statements are true or false

a) The mandatory civil services provided by the municipal authorifies are covered by the Consumer Protection Act, 1986.

b) The Act empowers the Consumer Courts to issue ~nterim injunction.

c) The Act does not empower the Consumer Courts to issue 'cease and desist' order.

d) The Consumer Courts can take up the Consumer cases suo motu.

e) The provisions of the Act are in addition to and not in derogation of any other law for the time being in force.

The Act specifies a time frame within which the consumer dispute is to be disposed of.

g) The six rights of consumers have been made justiciable.

h) The Consumer Courts have to depend on the Civil Courts for the execution of their orders.

i) The Consumer Courts can get the services of warrants affected without the help of the Criminal Courts.

j) Engagement of lawyer is mandatory for the complainant.

I Conhuner protection ~ c t I 20.3 SUGGESTIONS FOR AMENDMENTS IN THE ACT

AND IMPROVEMENTS IN ITS ENFORCEMENT AND *

IMPLEMENTATION

In the last section, we have discussed the limitations in the scope of the Act and weaknesses in its implementation. Now we give the areas where improvements can be made for enforcing the Act effectively.

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Section 2 (1) (d) and 2 (1) (0) of the Act should be suitably amended to modify the definition of the t e n s consumer and 'services' to make it clear that consideration shall not be a condition precedent in case of availing medical and municipal services provided by the govemment. A victim of medical negligence in a government hospital should be entitled to compensation by enlarging the definition of consumer and bringing free . services provided to the public by the government.

The Consumer redressal Fora should be vested with powers to issue interim injunctions restraining an undertaking or person from carrying on any unfair trade practice as defined in Act. In this connection, Section 12 A of the M.R.T.P. Act, 1969 is worth nothing. Under this Section, the M.R.T.P. Commission is empowered to grant temporary injunction restraining an undertaking or person from carrying on any monopolistic, restrictive or unfair trade practices until the conclusion of an inquiry or until further orders. Also the power to award temporary injunction indudes power to grant injunction without giving notice to the opposite party.

The Consumer Redressal Fora should be empowered to take up the cases suo motu.

In case the unfair trade practice about which a complaint has been made; and about which the consumer Redressal Forum has given relief to the complainant, then if Forum is of the opinion that the alleged unfair trade practice is against public interest, it should be empowered to pass an order that the practice shall be discontinued and shall'not be repeated. This is commonly called 'cease and desist' ordered. It is worth nothing that the M.R.T.P. Act 1969 is empowered to pass 'cease and desit order' if it is of the opinion that the alleged restrictive or unfair trade practice is against public interest.

It is absolutely essential to ensure the quality and competence of non-judicial members who are selected to work on the Benches of Consumer redressal agencies.

Also, emoluments of Presidents are far more than that of members. This anomaly should be rectified. The govemment should follow a policy of 'equal pay for equal work'. After all, the members on the consumer courts - whether judicial or non-judicial - have to play an equal role in the redressal process. Also, the consumer, of course, is expected to benefit from the combined wisdom of judicial and non-judicial Members.

In order to ensure smooth functioning of consumer redressal forums, the govemment should be more prudent in the selection of non-judicial members and provide proper training, if necessary, to make them good adjudicators.

The consumer redressal agencies should be equipped with the personnel for execution of their orders, and in chis way the necessity of depending on Civil or Criminal Courts would be obviated.

There is a need to prescribe the essential infrastructure to the District Forums and State Commissions so that they are not hamstrung functioning effectively.

The presence of lawyers should be permitted only where the complainant engages a lawyer which will justify engagement of lawyer by the respondent. Otherwise. a lawyer should be allowed only where the court specifically permits or considers it necessary.

Further, it should be provided that is no case more than two adjournments will be allowed.

Furthermore, a procedure must be established which makes it incumbent on the court to immediately give a copy of the order to the parties so that no excuse is given for delay in submission of appeals.

The Consumers should be allowed to lodge complaints with the Consumer Forums even where an alternative remedy is available under another enactment.

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xi) The Act should be modified to recognise a very important right of consumers viz. the Limltatim of the Commer

right to a healthy environment. Protectla Act, 1986

xii) The Act should be amended to make the six rights of consumers justiciable. In any case. 1 to begin with, it should be made obligatory for consumer redressal fora to consider them

I when adjudicating a complaint.

xiii) The Act should be amended to empower Consumer Courts to publish the names of manufacturers, traders and dealers whose goods are found to be hazardous to public safety. This empowerment would work as a deterrent to the erring business community. .

xiv) The Act should be amended providing that the consumer forums shall not order dismissal of a complaint merely on the ground that the complaint is of a complex nature and that it should be filed before a Civil Court of competent jurisdiction. To the extent that the jurisdiction over the complaint exists, the Consumer Court shall exercise the powers of a trial court to adjudicate the matter. After all, Consumer Courts are not Courts of summary jurisdiction. The National Commission has unlimited pecuriary jurisdiction and even the lower court, the District Forum has a high pecuniary limit of Rs. 5 lakh. How can cases of such value be always simple? Most of these disputes will be, by their very nature complex.

I i xv) An express provision, like the one found in several enactments imposing liability on the 1

! chief executive, manager, or director where an offense is shown to have been committed by an organisation, be made.

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1 xvi) The Act should be amended as to stream line the procedure that would facilitate

6 expeditious disposal of a consu,mer cases.

I First of all, as regards the time frame provided in the Act. In order to adhere to this time

I frame, it is necessary to prescribe a procedure wherein any complaint that is received in the Consumer Court at the district level is intimately scrutinized by authorised and competent personnel to determine whether the case falls within the Act and whether . should it be pursued.

i Check Your Progress 2

Note : i) Use the space below for your answers. ii) Check your progress with the model answers given at the end of the unit.

1) Discuss some of the limitations in the Consumer Protection Act. 1986.

! 2) Explain the following terms:

i) Petition ?

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ii) Interim injunction

iii) 'Cease and Desist' order

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iv) Warrant

20.4 LET US SUM UP

In this unit, we have highlighted the deficiencies not only in the Act, but in its implementation also. The scope of the Act needs to be extended to governmental hospitals and the mandatory civil services. The Act should incorporate certain product safety standards. The Courts should be given some more powers, such as power to issue 'interim injunction' and 'cease and desist orders'. They should also have the discretion to publish the names of those traders whose goods are found to be hazardous to public safety.

Further, a consumer should be authorised to lodge a complaint with the consumer forums even where no alternative remedies available.

20.5 KEY WORDS

Prima-facie : From a first impression I

Per Se : By or in itself, Intrinsically 1 Act : Law made by a legislative body

Gurbax Singh 1993 : Law of Consumer Protection, Bharat Law Publication, Jaipur.

P.K. Ma-jumdar, 1995: Law of Consunter Protection in India, Orient Publishing Company, New Delhi.

S.S. Gulshan, 1994: Consumer Protection and Satisfaction: Legal and Managerial 1 Dimensions, Eastern Usiley, New Delhi.

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20.7 ANSWERS TO CHECK YOUR PROGRESS d EXERCISES

Check Your Progress 1

f) True a) False

g) False b) False

h) True c) True

i) False d) False

j) False e) True

Check Your Progress 2 Limitations of the Consumer Protection Act, 1986

1) i) All services for which payment is made are nor covered by the Act.

ii) There is not provision for imposing liability on those who supply the hazardous goods.

iii) Safety rules have not been properly spelled out.

iv) Under the Act a consumer cannot seek redress for all cases. (For details see section 20.2)

2) i) An application to the court for writ, etc.

ii) Intervening judicial order.

iii) An order restraining the alleged offender to do any alleged offence.

iv) A written authorization allowing police to search premises, arrest a suspect, etc.

NOTES