(Subject Notes) Business Studies

- Consumer Protection -

2 questions of 6 marks come as choice

Giving any 6 points, explain the IMPORTANCE for consumer protection?

Business is a means of human welfare:

• Business serves the customer and therefore it is a means and not an end in itself.

• It is in the interest of both the consumer and the businessman to ensure that the business is run well because ignoring the interest of the consumer may be a sure death of the business.

Growth with social justice:

• We are a secular country and growth with social justice is the cornerstone of our economic philosophy.

• Exploitation of consumers is against the directive principles of State Policy laid down in our Indian Constitution.

Stakeholder approach:

• The success and survival of business depends on the efforts made by all stakeholders such as consumers, shareholders, employees, government, and the public.

• Therefore for its survival and growth business must work for the interest of the stakeholders in general and consumers in particular.

Power Centre:

Business has considerable influence over society and government. Therefore it has to set standards regarding food, dress habits, living styles, etc which will not damage the cause of society and serve the interest of a few persons only.

Self interest:

• Due to liberalization and globalization, firms have to compete with multinationals. Unless they become customer oriented and provide right quality, quantity and price they cannot satisfy a customer and without customer satisfaction no business can survive for long and will be out beaten by competition from multinationals.

• Moreover, Government has enacted laws to protect the interest of the consumers. Hence if a firm violates the laws they are likely to lose their goodwill and clients permanently.

Ethical obligations:

Business without ethical values is nothing but a criminal activity and no civil society will tolerate a business without ethical values for long.

(½ mark for naming each point and ½ mark for each explanation)

Explain in brief any six rights of consumers as provided under the Consumer Protection Act, 1986 – 6 marks Important

Or

Explain the following rights: (6 marks) – Any 3 will be asked

Clue: CHISER – choice, heard, informed, safety, education, redressal.

Right to choose

The consumer has the right to be assured of a choice of various goods and services of satisfactory quality and competitive price.

Right to representation (or right to be heard)

It is a right and the responsibility of civil society to ensure consumer interest prevails while formulating and executing policies which affect the consumers, as well as right to be heard while developing or producing a product or service

Right to be informed

Consumers have a right to be informed about the quality, quantity, potency, purity, standard and price of goods or services so that they can make the right decision and protect themselves against malpractices.

Right to safety

It refers to the right to be protected against products, production processes and services which are hazardous to health or life. It includes concern for consumers immediate and long term needs.

The right to consumer education

It is the right to acquire knowledge and skills to be an informed consumer because it is easier for the literate to know their rights and to take actions to influence factors that affect consumer’s decisions.

Right to seek redressal of aggrievances.

The consumer has the right go to court if he has been unscrupulously exploited against unfair or restrictive trade practices and receive compensation for supply of unsatisfactory or shoddy goods.

Right to basic needs

It is the right to receive the eight basic necessities that are required to survive and lead a dignified life. These eight basic necessities include food, clothing, shelter, health care, sanitation, education, energy and transportation.

Right to healthy environment

It is the right to be protected against environmental pollution and environmental degradation so as to enhance the quality of life of both the present and future generation.

Explain any six responsibilities of a consumer ( 6 marks)

It is the responsibility of the consumer to: (Important)

• Be aware of his rights and exercise them with regard to products purchased or services rendered.

• Be quality conscious and thoroughly examine the product before purchasing it.

  • Check the quality mark i.e. AGMARK, ISI, PDS, BIS, etc.

  • Ask for a guarantee card if there is one.

• Insist on a cash memo which is required as proof of purchase in case of a complaint.

• File a complaint for redressal of grievance however small, to discourage malpractices.

• Do not get carried away by advertisements but check the actual use of the product with that given in the advertisement. If there is a discrepancy, it should be brought to the notice of the sponsor.

• Form Consumer Awareness organizations, which can be represented at various committees formed by the government for the welfare of the consumers.

Explain any 4- 6 ways & means of consumer protection followed in India– 6 marks

The following are some of the ways and means of consumer protection followed in India:

Lok Adalats: How do Lok Adalat & publicity measures help in protecting the consumer? – 6 marks

• The Consumer can approach the Adalat with his grievance. The issue is discussed and decision is taken on the spot. This saves time and money

Publicity Measures: How do Lok Adalat & publicity measures help in protecting the consumer? – 6 marks

• 15th March is celebrated as World Consumer Right Day all over the world ever year.

• In 1995 this day was organized at Vigyan Bhawan, New Delhi.

• In addition, the Ministry with the help of DAVP undertook a massive outdoor publicity program such as displaying hoardings, banners, bus panels, etc.

• Telecasting on consumer protection is also done by Doordarshan on a fortnightly basis.

Public Interest Litigations: (Under what circumstances can a public interest litigation be filed?

• The Indian legal system does not provide legal services to large segments of the population such as the poor, environmentalists, consumers, minorities, etc.

• Therefore the Public Interest Litigations legally represents such groups for effective implementation of the law, environmental protection or any other social evils like bonded labour, etc.

Environmentally Friendly Products:

• The Ministry of Environment and Forests has introduced an “Eco-Mark” scheme. It is a label that has a symbol of an earthen pitcher. If this label appears on a product, it means that the manufacturer has satisfied the conditions laid down regarding the production processes and used environmental friendly materials.

• This scheme is consumer oriented so that people manufacture, use and dispose off products which are least harmful to the environment.

Redressal Forums & Consumer Protection Councils:

Under the Consumer Protection Act 1986 a judicial machinery such as the District Forums, State and National Commissions have been set up to provide speedy, effective and economical redressal of consumer grievances and disputes.

National Youth Award on consumer protection:

• To encourage consumers and youths to participate in consumer protection, the Union Ministry every year gives two national awards – National Award on Consumer Protection and National Youth Award on Consumer Protection.

• The Ministry also gives a National Woman Award to involve women in outstanding work in the field of consumer protection.

Consumer Welfare Fund :

A consumer welfare fund has been created according to the Central excise and Customs laws (Amendment) Act 1991. The excess amount of excise/custom duties which is not refundable to manufacturers or importers is credited into this fund and used for:

• Promoting the welfare of the consumers.

• Community based rural awareness projects

• Setting up a consumer guidance bureau to handle complaints, counseling and guidance

• Setting up consumer product testing laboratories.

What are the remedies/reliefs available to consumers under the Consumer Protection Act 1986? Discuss – 6 marks Important

The relief/remedies available to the consumer are:

• They can have the goods replaced

• They can get a price refund

• They can be compensated against loss or injury

• Discontinuation of unfair or restricted trade practices

• Withdrawal/discontinue the sale of hazardous goods

• Paying adequate cost to parties

• Removal of service deficiency

Explain the role of Consumer Organizations/Non govt. Organizations (any 6 points)

Or

Explain in brief any six functions of Consumer Organizations in the area of consumer protection. CBSE 2005 Set 1,2,3– 6 marks (Clue: BASIC FOE)

• Bringing out journals, brochures, monographs

• Arranging conferences, seminars, workshops on consumer problems and solutions

• Supporting government agencies against malpractices, adulterated & hazardous goods.

• Investigating into consumers problems

• Collecting data on different products and testing them

• Filing suits and petitions in the court on behalf of the consumers

• Organizing protests against price rigging, adulteration, underweight selling, etc

• Encouraging consumers to boycott defective bad quality goods

END