Consumer ProtectionClass 12 Business Studies Part 2 NCERT Solutions
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Q1Long Answer Type
Explain the importance of consumer protection from the point of view of a business.
Solution
Consumer protection is crucial for a business for the following reasons:
- Long-term Interest of Business: Businesses that prioritize customer satisfaction build a loyal customer base. Satisfied customers lead to repeat sales and provide positive word-of-mouth feedback, which helps in expanding the business. Thus, for long-term profit maximization, customer satisfaction is key.
- Business uses Society's Resources: Businesses operate using resources that belong to society. Therefore, they have a responsibility to supply products and services that are in the public interest and do not erode public trust.
- Social Responsibility: A business has social responsibilities towards various stakeholders, including consumers. Since businesses earn profits by selling goods and services to consumers, it is their duty to take care of consumers' interests.
- Moral Justification: It is the moral duty of every business to protect consumers from exploitation. Businesses must avoid unethical practices like selling defective products, adulteration, false advertising, and black-marketing.
- Government Intervention: A business that engages in exploitative trade practices is likely to face government intervention or legal action. This can tarnish the company's image and disrupt its operations. Therefore, it is advisable for businesses to voluntarily adopt practices that safeguard consumer interests.
Q2Long Answer Type
Explain the rights and responsibilities of consumer?
Solution
The Consumer Protection Act, 2019, provides for six consumer rights and also expects consumers to fulfill certain responsibilities.
Consumer Rights:
- Right to Safety: To be protected against goods and services which are hazardous to life and property. For example, using ISI-marked electrical appliances ensures they meet safety standards.
- Right to be Informed: To have complete information about a product's quality, quantity, price, ingredients, and manufacturing date before making a purchase.
- Right to be Assured (Choose): To have access to a variety of products and services at competitive prices, allowing the consumer to make an informed choice.
- Right to be Heard: To file a complaint and be heard in case of dissatisfaction with a product or service. Many firms have consumer grievance cells for this purpose.
- Right to Seek Redressal: To get relief against unfair trade practices or exploitation. This can include replacement of the product, refund of price, or compensation for loss.
- Right to Consumer Education: To acquire the knowledge and skills to be an informed consumer throughout life.
Consumer Responsibilities:
- Be Aware: Consumers should be aware of the various goods and services available to make an intelligent choice.
- Buy Standardised Goods: Look for quality certification marks like ISI, AGMARK, FPO, or Hallmark.
- Read Labels Carefully: Check information about price, weight, and expiry dates.
- Ask for a Cash Memo: Always get a proof of purchase.
- Assert Yourself: Ensure you get a fair deal from the seller.
- Be Honest: Discourage malpractices like black-marketing and hoarding by choosing only legal goods and services.
- File a Complaint: Do not hesitate to file a complaint in an appropriate forum for any grievance, no matter how small the amount.
- Form Consumer Societies: Participate in consumer organisations to safeguard consumer interests collectively.
- Respect the Environment: Avoid waste and pollution.
Q3Long Answer Type
What are various ways in which the objective of consumer protection can be achieved?
Solution
The objective of consumer protection can be achieved through the following ways and means:
- Self-regulation by Business: Socially responsible businesses adopt ethical standards and practices. They understand that serving customers well is in their long-term interest. Many firms establish their own customer service and grievance cells to address consumer problems proactively.
- Business Associations: Associations like the Federation of Indian Chambers of Commerce of India (FICCI) and the Confederation of Indian Industries (CII) have established a code of conduct for their members. These guidelines promote fair dealings with customers.
- Consumer Awareness: An informed consumer is a protected consumer. When consumers are aware of their rights and the available reliefs, they can raise their voice against unfair trade practices. Government campaigns like 'Jago Grahak Jago' play a significant role in creating this awareness.
- Consumer Organisations: These organisations are crucial in educating consumers about their rights and providing them protection. They conduct comparative testing of products, publish information, and can force businesses to avoid malpractices.
- Government: The government protects consumer interests by enacting and enforcing laws. The most important legislation is the Consumer Protection Act, 2019, which establishes a legal framework and redressal agencies. The government also sets up bodies like the Central Consumer Protection Authority (CCPA) and runs helplines to assist consumers.
Q4Long Answer Type
Explain the redressal mechanism available to consumers under the Consumer Protection Act, 2019
Solution
The Consumer Protection Act, 2019 provides for a three-tier quasi-judicial machinery at the district, state, and national levels for the redressal of consumer grievances.
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District Commission:
- Jurisdiction: It can entertain complaints where the value of goods or services paid as consideration does not exceed fifty lakh rupees.
- Process: The commission can refer a matter for mediation if both parties agree. If a complaint involves defective goods that need testing, a sample is sent to an appropriate laboratory. If a party is not satisfied with the order of the District Commission, they can appeal to the State Commission within 45 days.
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State Commission:
- Jurisdiction: It entertains complaints where the value of goods or services paid as consideration exceeds fifty lakh rupees but does not exceed two crore rupees. It also hears appeals against the orders of the District Commissions.
- Process: If a party is not satisfied with the order of the State Commission, they can file an appeal with the National Commission within 30 days of the order.
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National Commission:
- Jurisdiction: It has jurisdiction over complaints where the value of goods or services paid as consideration exceeds two crore rupees. It also hears appeals against the orders of the State Commissions.
- Process: An order passed by the National Commission can be appealed to the Supreme Court of India within 30 days.
Q5Long Answer Type
Explain the role of consumer organisations and NGOs in protecting and promoting consumer's interest.
Solution
Consumer organisations and Non-Governmental Organisations (NGOs) play a vital role in protecting and promoting the interests of consumers. Their key functions include:
- Educating Consumers: They educate the general public about consumer rights by organising training programs, seminars, and workshops.
- Publishing Information: They publish periodicals and other materials to impart knowledge about consumer problems, legal remedies, available reliefs, and other matters of interest.
- Comparative Testing of Products: They carry out comparative testing of consumer products in accredited laboratories. The results are published to help consumers make informed choices by comparing the relative qualities of competing brands.
- Encouraging Protests: They encourage consumers to strongly protest and take action against unscrupulous, exploitative, and unfair trade practices of sellers.
- Providing Legal Assistance: They provide legal assistance to consumers by offering legal advice and other aid in seeking legal remedies.
- Filing Complaints: They file complaints in appropriate consumer courts on behalf of consumers.
- Taking Initiative for Public Interest: They take the initiative in filing cases in consumer courts that are in the interest of the general public, not just for a single individual.
Q6Long Answer Type
Mrs. Mathur sent a jacket to a laundry shop in January 2018. The jacket was purchased at a price of ` 4,500 . She had previously sent the jacket for dry cleaning with Shine Dry Cleaners and the jacket was cleaned well. However, she noticed that her jacket had white discoloration marks when she collected the jacket this time. On informing the dry cleaner, Mrs. Mathur received a letter confirming that discolouration indeed appeared after the jacket was dry cleaned. She contacted the dry cleaner multiple times and requested for compensation for discoloured jacket but to no avail. Upon Consumer court's intervention, Shine Dry Cleaners agreed to compensate Rs. 2,500 to Mrs. Mathur for the discoloured jacket.
(a)
Which right was exercised by Mrs. Mathur at the first instance.
(b)
Name and explain the right which helped Mrs. Mathur to avail the compensation.
(c)
State which consumer responsibility has been fulfilled by Mrs. Mathur in the above case.
(d)
State any other two responsibilities to be assumed by the consumers.
Solution
(a) At the first instance, Mrs. Mathur exercised her Right to be heard. She exercised this right when she informed the dry cleaner about the discoloured jacket and requested compensation, ensuring her dissatisfaction was voiced.
(b) The right that helped Mrs. Mathur to avail the compensation is the Right to seek redressal. This right allows a consumer to get relief if a product or service falls short of expectations. The relief can be in the form of replacement, removal of defect, or compensation for any loss or injury. By approaching the consumer court, she sought and received monetary compensation for the damage to her jacket.
(c) Mrs. Mathur fulfilled the consumer responsibility of filing a complaint in an appropriate consumer forum. The text states that a consumer should not fail to take action even when the amount involved is small. She took the necessary step of approaching the consumer court when her initial attempts to resolve the issue with the seller failed.
(d) Two other responsibilities to be assumed by consumers are:
- Ask for a cash memo: A consumer should always ask for a cash memo or bill for the purchase of goods or services. This document serves as proof of the transaction and is essential when filing a complaint.
- Buy only standardised goods: Consumers should look for quality assurance marks like ISI on electrical goods or Hallmark on jewelry. This ensures that the products meet prescribed quality standards.
Q1Short Answer Type
Enumerate the various Acts passed by the Government of India which help in protection of consumers' interests.
Solution
The Government of India has passed several Acts to protect the interests of consumers. The legal framework includes:
- The Consumer Protection Act, 2019 (replacing the 1986 Act)
- The Indian Contract Act, 1872
- The Sale of Goods Act, 1930
- The Essential Commodities Act, 1955
- The Agricultural Produce (Grading and Marking) Act, 1937
- The Prevention of Food Adulteration Act, 1954
- The Standards of Weights and Measures Act, 1976
- The Trade Marks Act, 1999
- The Competition Act, 2002
- The Bureau of Indian Standards Act, 1986
Q2Short Answer Type
What are the responsibilities of a consumer?
Solution
A consumer has several responsibilities to ensure their own protection. These include:
- Be aware: A consumer should be aware of the various goods and services available to make an intelligent choice.
- Buy standardised goods: Look for quality assurance marks like ISI, FPO, or Hallmark.
- Read labels carefully: Check for information on prices, net weight, manufacturing and expiry dates.
- Ask for a cash memo: Always obtain a proof of purchase.
- File a complaint: Take action against any shortcoming in goods or services by filing a complaint in an appropriate consumer forum.
- Be honest in dealings: Choose legal goods and services and discourage malpractices like black-marketing.
Q3Short Answer Type
Who can file a complaint in a consumer court?
Solution
Under the Consumer Protection Act, 2019, a complaint can be filed by any of the following:
- One or more consumers.
- Any voluntary consumer association registered under the law.
- The Central Government or any State Government.
- The Central Consumer Protection Authority (CCPA).
- A legal heir or legal representative of a deceased consumer.
- A parent or legal guardian in the case of a minor.
Q4Short Answer Type
FSSAI (Food Safety and Standards Authority of India) has made a proposal for hotels and other food outlets to declare the kind of oil/fat used in cooking each of the food items on their menus. Name and explain the Consumer Right being reinforced by this proposal.
Solution
The consumer right being reinforced by this proposal is the Right to be informed.
This right states that a consumer has the right to have complete information about the product they intend to buy, including its ingredients, date of manufacture, price, quantity, directions for use, etc. By requiring food outlets to declare the type of cooking oil/fat used, FSSAI is ensuring that consumers receive crucial information about the food they are consuming. This allows them to make an informed and healthier choice, especially for those with allergies or specific dietary requirements.
Q5Short Answer Type
Who is a consumer as per CPA?
Solution
As per the Consumer Protection Act, 2019, a consumer is defined as a person who buys any goods or avails any services for a consideration, which has been paid or promised, or partly paid and partly promised, or under any scheme of deferred payment. The definition also includes any user of such goods or beneficiary of such services when the use is made with the approval of the buyer. However, it does not include a person who obtains goods or avails services for resale or for any commercial purpose.
Q1Very Short Answer Type
Under which consumer right does a business firm set up consumer grievance cell?
Solution
A business firm sets up a consumer grievance cell under the Right to be heard. This right ensures that a consumer's interests will receive due consideration at appropriate forums and provides them the right to file a complaint in case of dissatisfaction with a good or a service.
Q2Very Short Answer Type
Which quality certification mark is used for agricultural products?
Solution
The quality certification mark used for agricultural products is AGMARK. This mark is issued under The Agricultural Produce (Grading and Marking) Act, 1937, and it assures the quality and standard of agricultural commodities.
Q3Very Short Answer Type
What is the jurisdiction of cases that can be filed in a State Commission?
Solution
As per the Consumer Protection Rules 2021, a State Commission has the jurisdiction to entertain complaints where the value of goods or services paid as consideration exceeds fifty lakh rupees but does not exceed two crore rupees.
Q4Very Short Answer Type
State any two relief available to consumers under CPA.
Solution
Two reliefs available to consumers under the Consumer Protection Act are:
- To remove the defect in goods or deficiency in service.
- To replace the defective product with a new one, free from any defect.
Q5Very Short Answer Type
Name the component of product mix that helps the consumer to exercise the right to information.
Solution
The component of the product mix that helps the consumer exercise the Right to be informed is Labelling. The label on a product provides complete information about its ingredients, price, quantity, date of manufacture, directions for use, etc.