GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

   

Gujarat Board GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection Important Questions and Answers.

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Short Answer Type Questions

Question 1.
What is consumer protection?
Answer:
The act of providing shield to consumer from the unethical, exploitative and unlawful practices of sellers or manufacturers is called consumer protection.

Question 2.
What are the most important causes of consumer exploitation?
Answer:
In most of the cases, consumers either do not have the capacity to unite and become aware or do not have information regarding the legal measures and consumer rights. This leads to consumer exploitation.

Question 3.
How does a consumer undergo physical and mental exploitation?
Answer:
If the consumer is fooled or forced to purchase a sub-standard quality or a duplicate product, then it leads to mental and physical exploitation.

Question 4.
Into which parts can you classify importance of consumer protection?
Answer:
(A) Importance of Consumer Protection from the View Point of Business.
(B) Importance of Consumer Protection from the View Point of Consumer

Question 5.
What care should the business enterprise take with respect to use of public resources and wealth?
Answer:
Every business unit is continuously andhaphazardly utilizing public or say national resources and wealth. Hence, it is the responsibility of these units to produce such goods and services which are useful to the society.

Question 6.
What does the principle of Trusteeship say?
Answer:
The prinniple says that ‘Whatever wealth the society has given to us should be used for the welfare of the people of the society

Question 7.
How ignorance leads to consumer exploitation?
Answer:
Consumers are ignorant about laws and rights that have been empowered on them by the government for their protection. Many a times, they are misguided and misled. All these

Question 8.
How can consumers unite to fight against exploitation?
Answer:
Consumers can unite and file collective complaint to exert more pressure on authorities. Consumers can also form consumer forums to fight for various consumers.

Question 9.
What is Consumer Protection Act?
Answer:
Consumer Protection Act, 1986 is an Act of the Parliament of India enacted in 1986 to protect the interests of the consumers in India. Of the various measures adopted for consumer protection, Consumer Protection Act is the most important one.

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Question 10.
Which type of complain redressal system has been established under the Consumer Protection Act?
Answer:
A three level (tier) complain redressal system has been set up. The three tier includes complain redressal at
(a) District level,
(b) State level and
(C) National level.

Question 11.
State any four rights given to the consumers under Consumer Protection Act.
Answer:
Right to (1) Safety, (2) Information, (3) Representation and (4) Redressal.

Question 12.
What does right to safety say?
Answer:
Every consumer is entitled to get protection from products which are harmful to health. Hence, standardized and superior quality appliances should only be used so that they do not cause harm to consumers.

Question 13.
The consumer has right to which information of a product?
Answer:
Information such as ingredients, manufacturing date, directions for use, price, quality, weight, purity, etc.

Question 14.
What is right to choice?
Answer:
Every consumer has a right to choose the product he wishes to purchase. The consumer must get a product at a competitive price, in right quantity, right place and at right time.

Question 15.
How has the consumer benefited under the right to choose?
Answer:
The right of choice has led to production of variety of goods and services having different quality, brand, price, size, etc. Thus, the choices for consumer increased.

Question 16.
What does the right to redressal say?
Answer:
If a consumer gets sub-standard quality of goods or services as compared to what he has been promised then he has the right to get the relief.

Question 17.
Which two additional rights have been given to the consumer by UN?
Answer:
(i) Basic Needs and
(ii) Hygienic Environment.

Question 18.
What does Basic right given to consumer say?
Answer:
Basic Right says that every person is entitled to basic needs such as adequate food, water, clothing, shelter and health care required for survival.

Question 19.
What does right of Hygienic Environment say?
Answer:
As per the right of Hygienic Environment, every individual has the right to get pollution-free air, water, food and land.

Question 20.
What is the importance of getting a purchase bill?
Answer:
Bill plays the core role during complain redressal. If the consumer wants to complain to the Consumer Protection Forum for some faulty product, it is mandatory to submit the proof of purchase in the form of a bill.

Question 21.
Define consumerism.
Answer:
The act of promoting consumer protection at large is known as consumerism.

Question 22.
State two examples through which consumer can fulfill his duty towards environmental protection.
Answer:

  1. Consumer should throw the waste in dust-bins in order to prevent dirt and pollution,
  2. Consumer should switch-off lights of his building when they are unnecessary on.

Question 23.
What are district forums known as?
Answer:
District Consumer Disputes Redressal Forum (DCDRF)

Question 24.
What are state level commissions known as?
Answer:
State Consumer Disputes Redressal Commissions

Question 25.
State the full form of NCDRC.
Answer:
NCDRC – National Consumer Disputes Redressal Commission

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Question 26.
What are district forums?
Answer:
The District Level Forums or District Consumer Disputes Redressal Forum (DCDRF) are the lowest level or the primary level forum for solving the consumer complains. Government has set-up this forum in every district.

Question 27.
Give an idea about the members of National Level Commission.
Answer:
The National Commission consists of minimum five members. One of the members is appointed as the president of the forum. The president will be either existing or a retired judge of the Supreme Court. Moreover, at least one of the three members should be a woman.

Question 28.
State two reliefs that a consumer can get if he wins a consumer protection case.
Answer:

  1. The court can direct to remove the defects existing in the product or the service.
  2. It can direct to refund the money if defects are found in the product or the service.

Question 29.
How do industrial units hold Lok Adalats?
Answer:
Most industrial units and companies organize Lok Adalat for the genuine complaints of their consumers. For example, Bharat Sanchar Nigam Ltd. (BSNL) regularly organizes Lok Adalat. The consumer who has a complain can represent his case in these courts.

Question 30.
What is ECOMARK?
Answer:
ECOMARK is a certification mark given by the Department of Environment, Government of India to products conforming to a set of standards aimed at the least impact on the ecosystem.

Question 31.
How do producers get motivated to produce eco-friendly products?
Answer:
Consumers aware about environment protection will be inclined to use products carrying ECOMARK or say eco-friendly products. This will motivate more industries to start producing environment friendly products.

Question 32.
What is CCC?
Answer:
Consumer Coordination Council (CCC) is the national level apex body for all consumer organizations in India. It co-ordinates the work of various other institutions working for consumer protection.

Question 33.
What is DCA?
Answer:
The consumer department of India known as Department of Consumer Affairs (DCA) undertakes several activities to for spreading awareness among consumers.

Long Answer Type Questions

Question 1.
What is consumer protection? Explain.
Answer:
Consumer protection:
The act of providing shield to consumer from the unethical, exploitative and unlawful practices of sellers or manufacturers is called consumer protection.

  • Consumer protection also refers to the measures taken against the manufacturers and sellers who adopt various means to exploit consumers for earning high profits to fulfill their greed.
  • In most of the cases, consumers either do not have the capacity to unite and become aware or do not have information regarding the legal measures and consumer rights which can provide them justice in case of exploitation.

Question 2.
Who is a consumer as per Consumer Protection Act?
Answer:
According to the Consumer Protection Act,“A consumer is a person who receives goods or services against an exchange, who pays or agrees to compensate partly or fully or promises to compensate on a future date or has participated in some future payment plan. Any user of the product or service who uses it on the basis of the permission of the purchaser is a consumer. But the one who purchases on a resale basis or for further production is not included under the definition of a consumer.”

Question 3.
State the two views to classify importance of consumer protection.
Answer:
The importance of consumer protection can be broadly classified with respect to two views. They are:
(A) Importance of consumer protection from the View point of business

(B) Importance of consumer protection from the View point of consumer

  • The list of functions to be done under consumer protection is quite long and exhaustive.
  • The function of consumer protection is not limited to spreading awareness regarding consumers’ rights and responsibilities but also solving their genuine complaints.

Question 4.
Introduce Consumer Protection Act, 1986 and state the rights and responsibilities of the consumer as stated in the Act.
Answer:

  • Consumer Protection Act, 1986 is an Act of the Parliament of India enacted in 1986 to protect the interests of the consumers in India. Of the various measures adopted for consumer protection, Consumer Protection Act is the . , most important one.
  • This Act protects consumers from defective products, services, irrelevant business policies and cheating.
  • Under the aegis of this Act and Indian legal system, a three level (tier) complain redressal system has been set up. The three tier includes complainredressal at:
    (a) District level,
    (b) State level and
    (C) National level.
  • Consumers who feel cheated can complain at courts set-up at these three levels and obtain quick solution that too at very less expense.
  • The Consumer Protection Forum which has been set up under the direction of Consumer Protection Law, encourages and protects the rights of consumers.

The Act has given several rights and responsibilities to the consumer.
They are:
(A) Rights:

  • Safety
  • Information
  • Choice
  • Representation
  • Redressal
  • Consumer education

(B) Responsibilities:

  • Conscious use of the Rights
  • Beware of the misleading advertisements
  • Care during purchase
  • Solicit for a bill
  • Solicit a high quality
  • Registration of genuine complaints
  • Spread of consumerism
  • Environmental protection
  • Not to involve in unethical activities

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Question 5.
Enlist the rights and responsibilities of a consumer.
Answer:
The Act has given several rights and responsibilities to the consumer.
They are:
(A) Rights:

  • Safety
  • Information
  • Choice
  • Representation
  • Redressal
  • Consumer education

(B) Responsibilities:

  • Conscious use of the Rights
  • Beware of the misleading advertisements
  • Care during purchase
  • Solicit for a bill
  • Solicit a high quality
  • Registration of genuine complaints
  • Spread of consumerism
  • Environmental protection
  • Not to involve in unethical activities

Question 6.
Which additional rights has the UNO asked to give the consumers? Explain them.
Answer:
Over and above these six rights, The United Nations Organization (UNO) has issued a directive recommending two more rights for the consumers.

They are:

  1. Basic Needs
  2. Hygienic Environment.

1. Basic needs:
This Right says that every person is entitled to basic needs such as adequate food, water, clothing, shelter and health care required for survival.

2. Hygienic environment:

  • As per this Right, every individual has the right to get pollution-free air, water, food and land.
  • Hygienic environment gives the person a good quality of life free from diseases.

Question 7.
Write a detailed note on the functioning of the district forum.
Answer:
District Forums (District Consumer Disputes Redressal Forum (DCDRF):

  • The District Level Forums or District Consumer Disputes Redressal Forum (DCDRF) are the lowest level or the primary level forum for solving the consumer complains.
    Government has set-up this forum in every district.
  • This forum consist a minimum of three members appointed by the State Government. One of the members is appointed as the president of the forum. The president is or has been a judge in the District Court. Moreover, at least one of these three members should be a woman.

Process of complain and redressal:
The district redressal forum undertakes disputes where in the compensation claimed is less than ? 20 lakh.

  • Once the District Level Forum receives complain, it sends it to the accused i.e. the producer/seller against whom the complain is filed. If needed, the district forum can also send the product for laboratory testing.
  • The forum then listens to both the parties and also studies the laboratory report if included in the case. Based on the discussions and evidences, the forum passes a judgment.
  • If either of the parties is unhappy with the judgment, he can appeal at the State Level Commission for re-examination within 30 days of the judgment of District Level Forum.

Question 8.
Write a note on State Level Commissions (State Consumer Disputes Redressal Commissions).
Answer:
State Level Commission (State Consumer Disputes Redressal Commissions):

  • The State Level Commissions take care of the consumer redressal at state level.
  • It is the responsibility of the State Government to set up a State Level Commission.
  • This forum consists of minimum three members. One of the members is appointed as the president of the forum. The president shall be a person who is or has been a Judge of a High Court. Moreover, at least one of these three members should be a woman.

Process of complain and redressal:

  • The State Level Commission undertakes disputes where in the compensation claimed is more than ₹ 20 lakh but less than ₹ 1 crore. Moreover, a consumer who is dissatisfied over the judgment of the District Level Forum can apply to the State Level Commission within a period of 30 days of the judgment of the District forum.
  • Once the State Commission receives complain, it sends it to the accused i.e. the producer/seller against whom the complain is filed. If needed, the Commission can also send the product for laboratory testing.
  • The Commission then listens to both the parties and also studies the laboratory report if included in the case. Based on the discussions and evidences, the Commission passes a judgment.
  • If either of the parties is unhappy with the judgment, he can appeal at the National Level Commission for re-examination within 30 days of the judgment of State Level Commission.

Question 9.
Write a note on National Level Commission (National Consumer Disputes Redressal Commission).
Answer:
National Level Commission (National Consumer Disputes Redressal Commission):

  • The National Consumer Disputes Redressal Commission – NCDRC is the highest level Commission for resolving cases of consumers.
  • The responsibility of setting up this commission lies with the Central Government.
  • The National Commission consists of minimum five members. One of the members is appointed as the president of the forum. The president shall be either existing or a retired judge of the Supreme Court. Moreover, at least one , of the three members should be a woman.

Process of complain and redressal:

  • The National Level Commission undertakes disputes wherein the compensation claimed is ?1 crore or more. Moreover, a consumer who is dissatisfied over the judgment of the State Commission can apply to the National Level Commission within a period of 30 days of the judgment of the State Commission.
  • Once the National Commission receives complain, it sends it to the accused i.e. the producer/seller against whom the complain is filed. If needed, the Commission can also send the product for laboratory testing.
  • The Commissionthen listens to both the parties and also studies the laboratory report if included in the case. Based on the discussions and evidences, the Commission passes a judgment.
  • If the judgment of the National Level Commission does not satisfy either of the parties, they can appeal for re-examination with the Supreme Court in a specific time.

Question 10.
What reliefs can the consumer get in case he wins the case in the consumer court?
Answer:
If the court gives the judgment in the favour of the consumer, it can give one or more reliefs listed below to the consumer:

  • The court can direct to remove the defects existing in the product or the service.
  • It can direct to refund the money for the defects in the product or the service.
  • It can order to exchange defective product with the new (fresh) product.
  • If due to the negligence on part of the seller the consumer has to suffer any loss or injury, he can be compensated for the same.
  • The court can also penalize the seller.
  • The court can order to stop unfair and prohibitive business practices and also order not to repeat such activities in future.
  • Production and sales of harmful products can be stopped.
  • If products already present in market are found harmful, they can be banned.
  • If defective product or deficiency in service is found, at least 5% of amount of total sales should be ordered to deposit in Consumer Protection Fund or to any institution or person working with the objective of utilizing the amount for a specific purpose.
  • It can direct to remove misleading advertisements and introduce improvised advertisements.
  • It can order to make reasonable payment to the affected party (consumer) by way of compensation.

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Question 11.
How do big industrial units organize Lok Adalats?
Answer:

  • Most industrial units and companies organize Lok Adalat for the genuine complaints of their consumers. For example, Bharat Sanchar Nigam Ltd. (BSNL) regularly organizes Lok Adalat.
  • The consumer who has a complainre presents his case in this court.
  • In most of the cases, the company tries to redress the situation on the spot.
  • Thus, such a concept of Lok Adalat enables quick and effective redressal of the consumer complaints that too at a low cost.

Question 12.
What is ECOMARK? Which industries are allowed to use it? How does it motivate industries?
Answer:

  • ECOMARK is a certification mark given by the Department of Environment, Government of India to products conforming to a set of standards aimed at the least impact on the ecosystem.
  • Industrial units producing products with such standards are allowed to use ECOMARK on their products.
  • Consumers aware about environment protection will be inclined to use products carrying ECOMARK. This will in turn motivate more industries to start producing environment friendly products.

Question 13.
What are eco-friendly products? Why would business units produce them?
Answer:

  • Products that cause least harm to the environment are called eco-friendly products.
  • Industrial units producing products with such standards are allowed to use ECOMARK on their products.
  • Today’s consumer is getting aware about consumer protection and so in coming times he will prefer product having ECOMARK. As a result, industries will have to start producing environment friendly products.

Question 14.
Enlist few institutions/organizations that are working in the field of consumer awareness.
Answer:
Few of the institutions working in the field of consumer awareness are listed below:

  1. Consumer Education and Research Centre (CERC), Ahmedabad.
  2. Consumer Protection Council (CPC), Ahmedabad.
  3. Voluntary Organization in Interest of Consumer Education (VOICE), Delhi.
  4. Consumer Guidance Society of India (CGSI), Mumbai.
  5. Consumer Unity and Trust Society (CUTS), Jaipur.

Consumer Coordination Council (CCC) is the national level apex body for all consumer organizations in India.

The consumer department of India known as Department of Consumer Affairs (DCA) also undertakes several activities to for spreading awareness among consumers.

Question 15.
Give a brief idea about CCC and DCA. OR Write a note on Consumer Coordination Council and Department of Consumer Affairs.
Answer:

  • Consumer Coordination Council (CCC) is the national level apex body for all consumer organizations in India. It co-ordinates the work of various other institutions working for consumer protection.
  • Various private organizations which work towards consumer protection are members of Consumer Co-ordination Council.
  • The consumer department of India known as Department of Consumer Affairs ‘ (DCA) also undertakes several activities for spreading awareness among consumers.
  • DCA also prints several advertisements under the heading ‘Jago Grahak Jago’, and providing National Consumer Helpline (NCH) tollfree number, web site, etc. to help the consumers.

Question 16.
What has the business unit to do with the utilization of public resources and wealth?
Answer:

  • Every producer or seller is also a consumer for things he does not produce.
  • The business unit forgets this fact and continuously and haphazardly utilizes public i.e. national resources and wealth.
  • The producer forgets that by exploiting the resources extensively ignoring the needs of the society and the future generation, he is digging his own grave. Since, producer is a consumer too, if he does not produces goods and services responsibly, he too will suffer the dangers caused by such practices.

Question 17.
Why are consumers exploited?
Answer:

  • Consumers are exploited due to a variety of reasons.
  • The greed of producer and seller to earn maximum leads him to enter into false practices. The false practices could be over-pricing, under-measurement, producing sub-standard products, not giving bills, etc.
  • On the hand, consumer also gets exploited due to their own reasons. Many a time they do not insist on bill, they do not check the expiry date of the product, ingredients, etc.
  • Many consumers become lured to the false claims of manufacturers and advertisers and purchase products.

Question 18.
United we stand, divided we fall. Explain with respect to consumer protection.
Answer:

  • Consumer exploitation is quite rampant these days.
  • Even if a consumer knows he is been cheated, he is not able to raise his voice many a times due to his ignorance or frustration or fear to stand up and fight for his rights.
  • When the producer or seller is strong and has high reputation as well as political power, the consumer may fear to fight him. Moreover, his single voice may not be even heard.
  • In such cases, a single consumer may find himself weak, but if consumers unite, they can become more powerful and fight against the injustice done to consumers.
  • The group can form a consumer protection forum. The forum can fight for the right of all those consumers who get cheated and it will be easier and effective, to protect the interests of the consumers.
  • Hence, it can be rightly said that if consumers unite, they can stand together but if they divide, they might fall i.e. they may be deprived of justice.

Question 19.
Give few examples of consumers getting fooied/exploited under misleading advertisements.
Answer:
Examples of misleading advertisements to fool/exploit consumers:
1. Buy one get one offer:
In such offer, the second product is not free, it is given only when the first product is purchased.

2. Hidden charges:
The consumer may not be aware about some charges while buying the service, because those are not mentioned initially. For example, administrative charges in hospital when a patient is admitted are rarely known, the sim card may be free, but there might be charges for its activation, the price mentioned on menu card of restaurant do not show taxes that will be charged, etc.

3. Going out of the way to generate business:
The products such as clothes may be priced more than their original price and then discount may be offered to lure the consumers.

4. Changing the weight:
At times, the malls and large stores display discounted price of products (such as ketchup, jam, etc.) but in fact they sell less weight. For example, the store may advertise as 1kg ketchup just for Rs. 130, but in fact the packet may contain only 950 gm ketchup.

Question 20.
Insistence upon bill of a product is not an individual benefit but also of the whole nation. Explain.
Answer:

  • Many consumers do not take the bill for the products purchased. They either forget or do not care, or avoid the bill to get hidden benefits.
  • When the consumer does not take bills, the seller may not show the sales proceedings in his book of accounts. Similarly, the consumer too will not show the expense in his accounts.
  • The purchase and sale of products come with a host of government taxes both for the buyer as well as seller. By not issuing the bills, both the buyer and the seller escape from paying the tax.
  • The tax money that the government gets is in fact put back into economy by means of raising and maintaining infrastructure in the nation. The money is also put in various projects for the development of the nation which then generates employment and keep the economy running and growing. So, directly or indirectly, the money benefits the individual too.
  • Thus, insistence upon bill of a product is not an individual benefit but also of the whole nation.

Question 21.
Mention four functions of NGO that specifically work for consumer protection.
Answer:

  1. Educating consumers about their rights through seminars, conferences and workshops.
  2. Publishing periodicals, notices, booklets, etc. to spread awareness regarding problems faced by consumers, for legal awareness, eligibility of compensation and other favourable information.
  3. Consumers are informed about the comparison of various products and services available in the market, quality analysis by the authorized laboratories and their reports.
  4. Support to provide the consumers legal information and aid for the legal formality.

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Question 22.
How can you say that India is marching towards consumer awareness?
Answer:

  • A lot of work has been done in the field of consumer awareness.
  • Rise in education has resulted in an increase in consumer awareness regarding their rights.
  • Consumer rights have been included in the syllabus of school and college.
  • Government has also made necessary changes in the laws.
  • Government publishes several advertisements in the newspaper to educate the consumers.
    Government is making effort for speedily solving the cases in consumer courts.
  • Several NGOs and other organizations are also putting a lot of effort to help the consumers.

Multiple Choice Questions

Question 1.
Which of the following is not a form of consumer exploitation?
(A) Physical and mental exploitation
(B) Economic exploitation
(C) Against public interest
(D) None of these
Answer:
(D) None of these

Question 2.
If the seller is following malpractices such as hoarding of goods, black marketing and charging higher price than the printed price then it is
(A) Physical exploitation
(B) Mental exploitation
(C) Economic exploitation
(D) Against interest
Answer:
(C) Economic exploitation.

Question 3.
Which type of loss is a loss occurred due to sub-standard quality of product?
(A) Social
(B) Physical
(C) Economic
(D) Environment
Answer:
(B) Physical

Question 4.
How many members are there in National Level Commission?
(A) 3
(B) 5
(C) 6
(D) 7
Answer:
(B) 5

Question 5.
Who can complain to the dispute settlement institutions?
(A) Registered consumer union on behalf of consumer
(B) State government or central government on behalf of consumers
(C) Legal heirs or representatives of deceased consumers
(D) All of these
Answer:
(D) All of these

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Question 6.
Indian Constitution has stated that India is a/an country.
(A) Socialist
(B) Capitalist
(C) Free economy
(D) Both (A) and (C)
Answer:
(A) Socialist

Question 7.
The Consumer Protection Act was brought into force in
(A)1947
(B)1950
(C)1968
(D)1971
Answer:
(C)1968

Question 8.
Over-pricing is a form of exploitation.
(A) Physical
(B) Mental
(C) Economic
(D) Social
Answer:
(C) Economic

Question 9.
For which of the following is consumer not responsible?
(A) Beware of the misleading advertisements
(B) Redressal of public
(C) Solicit high quality
(D) Environmental protection
Answer:
(B) Redressal of public

Question 10.
When is Consumer Day celebrated?
(A) 15th March
(B) 5th June
(C) 23rd September
(D) 1st December
Answer:
(A) 15th March

Question 11.
_________ rights are available to consumers under Consumer Protection Act.
(A) 5
(B) 6
(C) 7
(D) 8
Answer:
(B) 6

Question 12.
The district redressal forum undertakes disputes where in the compensation claimed is _________
(A) less than ₹ 20 lakh
(B) more than ₹ 10 lakh
(C) ₹ 20 lakh to ₹ 30 lakh
(D) ₹ 10 lakh to ₹ 20 lakh
Answer:
(A) less than ₹ 20 lakh

Question 13.
Within how many days can a consumer make an appeal in state level commission if he is dissatisfied with the district forum?
(A) 15 days
(B) 30 days
(C) 45 days
(D) 60 days
Answer:
(B) 30 days

Question 14.
The president of state level commission should be or should have been
(A) High Court Judge
(B) District Court Judge
(C) Civil Judge
(D) Any of these
Answer:
(A) High Court Judge

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Question 15.
The state level commission undertakes disputes where in the compensation claimed is
(A) 120 lakh to ₹ 30 lakh
(B) less than ₹ 20 lakh
(C) More than 11 crore
(D) ₹ 20 lakh to ₹ 1 crore
Answer:
(D) ₹ 20 lakh to ₹ 1 crore

Consumer Protection – GSEB Std 12 Organization of Commerce and Management Notes

Meaning of Consumer Protection:
The act of providing shield to consumer from the unethical, exploitative and ‘ unlawful practices of sellers or manufacturers is called consumer protection.

The exploitation of consumers can be categorized under three categories:
1. Physical and mental exploitation:
If the consumer is fooled or forced to purchase a sub-standard quality or a duplicate product, then it leads to mental agony as well as physical loss.

2. Economic exploitation:
If the seller is following malpractices such as hoarding of goods, black marketing and charging higher price than the printed price then it is the economic exploitation of the consumer.

3. Against public interest:
Public interest is not safeguarded when some products are produced by using certain materials which can cause harm to environment.

Meaning of consumer:
According to the Consumer Protection Act, a consumer is “A person who receives goods or services against an exchange who pays or agrees to compensate partly or fully or promises to compensate on a future date or has participated in some future payment plan. Any user of the product or service who uses it on the basis of the permission of the purchaser is a consumer. But the one who purchases on a resale basis or for further production is not included under the definition of a consumer.”

Importance of consumer protection:
Importance of consumer protection from the view point of business:

  • Use of public resources and wealth
  • Social responsibility
  • Part of the society
  • Impression on the society
  • Consumers’ protection is good for business
  • Principle of Trusteeship and Consumer Protection

Consumer protection from the view point of consumer:

  • Extensive exploitation of consumers
  • Ignorance of consumers
  • Lack of unity among consumers

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 11 Consumer Protection

Consumer Protection Act -1986:

  • Consumer Protection Act, 1986 is an Act of the Parliament of India enacted in 1986 to protect the interests of the consumers in India. Of the various measures adopted for consumer protection, Consumer Protection Act is the most important one.
  • Under the aegis of this Act and Indian legal system, a three level (tier) complain redressal system has been set up.

The three tier includes complain redressal at
(a) District level
(b) State level and
(C) National level.

The Act has given several rights and responsibilities to the consumer. They are:
(A) Rights of the consumers:

  • Safety
  • Information
  • Choice
  • Representation
  • Redressal
  • Consumer education.

Additional Rights of Consumers through United Nations Organization Directive:

  • Basic Needs
  • Hygienic Environment.

(B) Responsibilities of consumers:

  • Conscious use of rights
  • Beware of misleading advertisements
  • Care during purchase
  • Solicit for a bill
  • Solicit a high quality
  • Registering of genuine complaints
  • Spread of consumerism
  • Environmental protection
  • No involvement in unethical activities.

Grievances Redressal Organizations:
To see that consumers are heard for their problems, the government has formed a three-tier redressal system. These three tire are classified as district level, state level and national level.

Based on this tire system, the redressal system can be classified as:
(a) District Forums (District Consumer Disputes Redressal Forum (DCDRF)
(b) State level commissions (State Consumer Disputes Redressal Commissions) (SCDRC)
(c) National level commission (National Consumer Disputes Redressal Commission) (NCDRC)

1. District Level Forum:

  • When the compensation demanded for the disputed product or service equals to or is less than ₹ 20 lakhs, it will be dealt by District Level Forum for its listening and settlement.
  • In District Level Forum, at least 3 members are appointed by state government, out of whom one is the president and one should be a woman member.
  • If either of the parties is not satisfied by the judgment of the District Level Forum, then within 30 days, it can appeal to the State Level Commission for reconsideration.

2. State Level Commissions:
If the compensation demanded for the disputed product or service is more than ₹ 20 lakhs but equals to or less than ₹ 1 crore, the State Level Commission listens the dispute and settles it. If any party is dissatisfied by the judgment of the District Level Forum and if it is brought to the State Level Commission, it will be heard by them. The State Government appoints at least 3 members out of which one will be the president and one should be a woman member. If any party is not satisfied with the judgment of the State Level Commission, then within 30 days, it can appeal to the National Level Commission for reconsideration.

3. National Level Commission:
If the compensation amount demanded for the disputed product or service exceeds ₹ 1 Crore, the National Level Commission listens to the dispute and settles it. If either party is not satisfied by the judgment of the State Level Commission, it will be handled by the National Level Commission. Atleast five members are appointed by the Central Government out of which one is the president and one should be a women member. Any party can appeal to the Supreme Court in reasonable time if they are not satisfied by the judgment of National Level Commission.

Available Remedies / Reliefs for Consumers:
If the court gives the judgment in the favour of the consumer, it can give one or more reliefs to the consumer.

Consumer Awareness:

  • Lok Adalat: Lok-Adalat (Public Court or People’s Court) is one of the alternative dispute resolution mechanisms in India. It is a forum where cases pending or at pre-litigation stage in a court of law are settled.
  • Public Interest Litigation (PIL): In Indian law, public interest litigation means a litigation (judicial proceeding) for the protection of public interest.

Eco-friendly products:

  • The Department of Environment, Government of India gives ECOMARK which is a certification mark given to products conforming to a set of standards aimed at the least impact on the ecosystem. Such products are called eco-friendly products.
  • Consumers aware about environment protection will be inclined to use products carrying ECOMARK. This motivates more industries to start producing environment friendly products.

Consumer Unions and the role of Non-Government Organization :

  • In India, there are several consumer unions and Non-Government Organizations that are actively working for maintaining and protecting the interests of consumer.
  • NGOs are non-profit organizations. They work for the welfare of the people on , their own. They perform various functions for consumer protection.
  • Institutions working in the field of spreading consumer awareness:
    1. Consumer Education and Research Centre (CERC), Ahmedabad
    2. Consumer Protection Council (CPC), Ahmedabad
    3. Voluntary Organization in the Interest of Consumer Education (VOICE), Delhi
    4. Consumer Guidance Society of India (CGSI), Mumbai
    5. Consumer Unity and Trust Society (CUTS), Jaipur, etc.
  • Consumer Co-ordination Council (CCC), Delhi compiles and co-ordinates the activities of all other institutions working on consumer protection.
  • The consumer department of India known as Department of Consumer Affairs (DCA) also undertakes several activities for spreading awareness among consumers.

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