The Consumer Protection Act, 1986
This Act was passed “to provide for better protection of the interest of
consumers and to make provision for the establishment of consumer councils
and other authorities for the settlement of consumer’s disputes.” The Act has
been amended by the Consumer Protection (Amendment) Act, 2002.
a) Definitions under the Act
Some definitions provided in the Act are as follows:
Definition
“Service” means service of any description which is made available to potential
users and includes the provision of facilities in connection with banking,
financing, insurance, transport, processing, supply of electrical or other energy,
board or lodging or both, housing construction, entertainment, amusement or
the purveying of news or other information. But it does not include the
rendering of any service free of charge or under a contract of personal service.
Insurance is included as a service
“Consumer” means any person who:
i. Buys any goods for a consideration and includes any user of such goods.
But does not include a person who obtains such goods for resale or for
any commercial purpose or
ii. Hires or avails of any services for a consideration and includes
beneficiary of such services.
'Defect' means any fault, imperfection, shortcoming inadequacy in the quality,
nature and manner of performance which is required to be maintained by or
under any law or has been undertaken to be performed by a person in
pursuance of a contract or otherwise in relation to any service.
'Complaint' means any allegation in writing made by a complainant that:
i. An unfair trade practice or restrictive trade practice has been adopted
ii. The goods bought by him suffer from one or more defects
iii. The services hired or availed of by him suffer from deficiency in any
respect
iv. Price charged is in excess of that fixed by law or displayed on package
Goods which will be hazardous to life and safety when used are being
offered for sale to the public in contravention of the provisions of any law
requiring trader to display information in regard to the contents, manner
and effect of use of such goods
'Consumer dispute' means a dispute where the person against whom a
complaint has been made, denies and disputes the allegations contained in the
complaint.
b) Consumer disputes redressal agencies
Consumer disputes redressal agencies are established in each district and
state and at national level.
i. District Forum: The forum has jurisdiction to entertain complaints,
where value of the goods or services and the compensation claimed is up
to Rs. 20 lakhs The District Forum is empowered to send its order/decree
for execution to appropriate Civil Court.
ii. State Commission: This redressal authority has original, appellate and
supervisory jurisdiction. It entertains appeals from the District Forum. It
also has original jurisdiction to entertain complaints where the value of
goods/service and compensation, if any claimed exceeds Rs. 20 lakhs but
does not exceed Rs. 100 lakhs. Other powers and authority are similar to
those of the District Forum.
iii. National Commission: The final authority established under the Act is
the National Commission. It has original; appellate as well as supervisory
jurisdiction. It can hear the appeals from the order passed by the State
Commission and in its original jurisdiction it will entertain disputes,
where goods/services and the compensation claimed exceeds Rs.100
lakhs. It has supervisory jurisdiction over State Commission.
All the three agencies have powers of a Civil Court.
c) Procedure for filing a complaint
The procedure for filing a complaint for the three redressal agencies
mentioned above is very simple. There is no fee for filing a complaint or
filing an appeal whether before the State Commission or National
Commission.
The complaint can be filed by the complainant himself or by his authorised
agent. It can be filed personally or can even be sent by post. It may be
noted that no advocate is necessary for the purpose of filing a complaint.
d) Consumer Forum orders
If the forum is satisfied that the goods complained against suffer from any of
the defects specified in the complaint or that any of the allegations
contained in the complaint about the services are proved, the forum can
issue an order directing the opposite party to do one or more of the
following namely,
i. To return to the complainant the price, [or premium in case of
insurance], the charges paid by the complainant
ii. To award such amount as compensation to the consumers for any loss or
injury suffered by the consumer due to negligence of the opposite party
iii. To remove the defects or deficiencies in the services in question
iv. To discontinue the unfair trade practice or the restrictive trade
practice or not to repeat them
v. To provide for adequate costs to parties
e) Consumer disputes categories
The majority of consumer disputes with the three forums fall in the
following main categories, as far as the insurance business is concerned:
i. Delay in settlement of claims
ii. Non-settlement of claims
iii. Repudiation of claims
iv. Quantum of loss
v. Policy terms, conditions etc
This Act was passed “to provide for better protection of the interest of
consumers and to make provision for the establishment of consumer councils
and other authorities for the settlement of consumer’s disputes.” The Act has
been amended by the Consumer Protection (Amendment) Act, 2002.
a) Definitions under the Act
Some definitions provided in the Act are as follows:
Definition
“Service” means service of any description which is made available to potential
users and includes the provision of facilities in connection with banking,
financing, insurance, transport, processing, supply of electrical or other energy,
board or lodging or both, housing construction, entertainment, amusement or
the purveying of news or other information. But it does not include the
rendering of any service free of charge or under a contract of personal service.
Insurance is included as a service
“Consumer” means any person who:
i. Buys any goods for a consideration and includes any user of such goods.
But does not include a person who obtains such goods for resale or for
any commercial purpose or
ii. Hires or avails of any services for a consideration and includes
beneficiary of such services.
'Defect' means any fault, imperfection, shortcoming inadequacy in the quality,
nature and manner of performance which is required to be maintained by or
under any law or has been undertaken to be performed by a person in
pursuance of a contract or otherwise in relation to any service.
'Complaint' means any allegation in writing made by a complainant that:
i. An unfair trade practice or restrictive trade practice has been adopted
ii. The goods bought by him suffer from one or more defects
iii. The services hired or availed of by him suffer from deficiency in any
respect
iv. Price charged is in excess of that fixed by law or displayed on package
Goods which will be hazardous to life and safety when used are being
offered for sale to the public in contravention of the provisions of any law
requiring trader to display information in regard to the contents, manner
and effect of use of such goods
'Consumer dispute' means a dispute where the person against whom a
complaint has been made, denies and disputes the allegations contained in the
complaint.
b) Consumer disputes redressal agencies
Consumer disputes redressal agencies are established in each district and
state and at national level.
i. District Forum: The forum has jurisdiction to entertain complaints,
where value of the goods or services and the compensation claimed is up
to Rs. 20 lakhs The District Forum is empowered to send its order/decree
for execution to appropriate Civil Court.
ii. State Commission: This redressal authority has original, appellate and
supervisory jurisdiction. It entertains appeals from the District Forum. It
also has original jurisdiction to entertain complaints where the value of
goods/service and compensation, if any claimed exceeds Rs. 20 lakhs but
does not exceed Rs. 100 lakhs. Other powers and authority are similar to
those of the District Forum.
iii. National Commission: The final authority established under the Act is
the National Commission. It has original; appellate as well as supervisory
jurisdiction. It can hear the appeals from the order passed by the State
Commission and in its original jurisdiction it will entertain disputes,
where goods/services and the compensation claimed exceeds Rs.100
lakhs. It has supervisory jurisdiction over State Commission.
All the three agencies have powers of a Civil Court.
c) Procedure for filing a complaint
The procedure for filing a complaint for the three redressal agencies
mentioned above is very simple. There is no fee for filing a complaint or
filing an appeal whether before the State Commission or National
Commission.
The complaint can be filed by the complainant himself or by his authorised
agent. It can be filed personally or can even be sent by post. It may be
noted that no advocate is necessary for the purpose of filing a complaint.
d) Consumer Forum orders
If the forum is satisfied that the goods complained against suffer from any of
the defects specified in the complaint or that any of the allegations
contained in the complaint about the services are proved, the forum can
issue an order directing the opposite party to do one or more of the
following namely,
i. To return to the complainant the price, [or premium in case of
insurance], the charges paid by the complainant
ii. To award such amount as compensation to the consumers for any loss or
injury suffered by the consumer due to negligence of the opposite party
iii. To remove the defects or deficiencies in the services in question
iv. To discontinue the unfair trade practice or the restrictive trade
practice or not to repeat them
v. To provide for adequate costs to parties
e) Consumer disputes categories
The majority of consumer disputes with the three forums fall in the
following main categories, as far as the insurance business is concerned:
i. Delay in settlement of claims
ii. Non-settlement of claims
iii. Repudiation of claims
iv. Quantum of loss
v. Policy terms, conditions etc
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