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COMMENTARY

Consumer Protection Act


An Unequal Fight
Sakuntala Narasimhan

Twenty-five years after the


Consumer Protection Act was put
in place as a uniquely beneficial
social legislation offering simple,
speedy and inexpensive
redressal, all three characteristics
seem to have disappeared.
Amendments to the Act now
being proposed will further erode
consumers rights instead of
addressing existing lacunae.

The author would like to thank the reviewer


for comments on an earlier, longer version of
this article.
Sakuntala Narasimhan (sakunara@gmail.com)
is a national award winning journalist and
consumer activist.

20

omplaint no 1809/2012 before


the Consumer Disputes Redressal
Forum, Bangalore Urban District
(Karnataka) typifies the multitude of
problems that citizens face today, in seeking redress under the Consumer Protection Act. The complainant, aged 70,
acquired a Sony digital camera costing
Rs 5,417, in March 2012, and took it
to Europe in May, to take pictures at a
special international conference organised to mark her scientist husbands
80th birthday. However, she found that
the narrow plastic strip cover of the battery compartment had got warped and
would not close, so she could not use the
camera. The chance to add photos to the
family archives, of an international honour abroad, was lost. On her return to
India in July, she asked Sony to replace
the camera or refund the money. Sony
refused, citing its No refund, no replacement warranty clause, and merely
pressed the strip back to straighten it.
She filed a complaint under the Consumer
Protection Act, seeking replacement or
refund, plus Rs 5,000 token compensation for loss and distress caused by being
unable to use the camera at an important event. The district forum (popularly
known as consumer court) dismissed her
complaint in February 2013, on grounds
that Sonys warranty clause said no
replacement, no refund, and that it
would be unfair to a manufacturer to
claim replacement, if the defective part
has been replaced.
This was a manifestly flawed order,
on several counts first, the defective
part (warped strip) had not been replaced, it had only been pressed down
and straightened; and a thin 4 mm wide
plastic strip that has to be opened repeatedly for charging the battery is
bound to break at the point where it had
got warped the complainant had even
produced a similar broken plastic strip
from another gadget of the same brand

bought by a friend. Secondly, the rulings


of the National Consumer Disputes Redressal Commission (NCDRC), the apex
body for consumer complaints are binding
on all district fora around the country,
and a list of 12 relevant NCDRC orders in
similar cases was submitted by the complainant to the forum, which ignored
them. The National Commission had
ruled in December 1992 that, If a complainant was denied the use of a product
at a time when he needed it most it
would amount to deficiency of service.1
The NCDRC has also clearly declared in
several judgments that a manufacturer
cannot draw up arbitrary warranty clauses
that are unfair to the buyer. Section 14(1)
of the Act gives powers to a consumer forum to order replacement of goods saying, In spite of exclusionary clauses in
the warranty aimed at restricting or excluding the liability of the seller.2 National award winning consumer activist
Jehangir Gai says, No manufacturer can
formulate a warranty in a manner overriding the statutory provisions of the Act
which entertain claims for replacement
of faulty goods. The forum ignored
these guidelines. Thirdly, the law says a
copy of the complaint should be sent to
the opposite party within 21 days; in this
case the Bangalore forum took two months
to send a copy to Sony. The stipulations
of the law got thrown out of the window.
There was also the curious issue of the
court demanding stamps worth Rs 45
and envelopes, for forwarding the complaint to Sony the statute authorises
no such collection towards postage (as
confirmed by the legal cell of Consumer
Education and Research Centre, Ahmedabad).3 Besides, only some complainants were asked to bring stamps (in complaint Nos 1735/2011, and 2118/2012 no
stamps were demanded). Walter Vieira,
chairman of Consumer Education and
Research Society of Ahmedabad and M
S Kamath of the Consumer Guidance Society of India at Mumbai both concede
that things have gone from bad to
worse in the implementation of the Act.
In Shambles
Passed in 1986, the Consumer Protection Act (CPA) was hailed worldwide as
a very comprehensive legislation for

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COMMENTARY

ensuring justice to the common man.


However, as the law completes a quarter
century of functioning in 2014, activists
around the country are wondering if the
spirit of the Act lies in shambles. Before
1986, aggrieved citizens had to approach
civil courts, where cases took years, and
the procedures were intimidating, with
lawyers, court fees, stamp paper, etc.
The new law sought to provide, through
a three-tier mechanism of quasi-judicial
consumer courts at the district, state
and national levels, speedy resolution of
grievance (within 90 days) with no
court fees, no need for lawyers, no
stamp paper; just a simple complaint on
plain paper listing the facts of the grievance was enough. Over the years, the
90-day limit got tossed aside. Cases now
drag on for years (complaint No 498 of
2009 was still being heard at the end of
2012 at Bangalore, as was one from
2007; at Mumbai a complaint filed in
1992 went on for 14 years). Instead of being free, a fee (ranging from a minimum
of Rs 100, plus bank charges for demand
drafts) has to be paid now, following an
amendment in 2003. Affidavits, legal
paper and mandatory notarised submissions have complicated the procedures, where once, just three documents
(the complaint, opposite partys reply,
and rejoinder) sufficed, since justice was
to be according to fairness and principles of natural justice, not according to
the letter of the law.4
Where once lawyers were not required (even barred unless the complainant opted to employ one; the Bar
Council contested this rule, citing their
right to earn a living) today consumer
courts are overrun by lawyers in black
coats who appropriate all the front seats
introducing all the time-consuming
technicalities that these fora were specifically meant to avoid. (Under the Act,
technicalities are not to be encouraged,
and the only procedure to be followed is
the principle of natural justice.)5 This
results in endless adjournments (which
the court can refuse, but invariably grants).
A case against the Maruti Company filed
by a 76-year-old complainant went to 26
adjournments over 38 months. He died
before getting redress. Under an amendment of 2003, the courts can award
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JANUARY 31, 2015

costs to the complainant for each


adjournment, but most complainants
are unaware of this provision, and the
court does not advise them either. The
amendment requires the reasons for
each adjournment to be recorded. This
rule is flouted too. Backlogs accumulate.
Over 3.5 lakh complaints were pending
at the last count. This is hardly simple
or speedy or consumer friendly. Multinational companies can afford to employ
lawyers to use legal jargon and protect
the interests of the manufacturer, rather
than ensure justice to aggrieved customers. Most complainants, on the other
hand, cannot afford to employ a lawyer
to fight for refund of a few thousand rupees after getting saddled with a malfunctioning appliance. It becomes an
unequal fight between a professional
lawyer and a lay consumer, even in a
consumer court meant to offer justice
without intimidation or expense.
The Sony case provides a typical example of how lawyers hijack proceedings with long-winded rejoinders. In
response to the complaint, the lawyers
submission to the court said, The
complaint is vexatious, baseless, and an
abuse of the process of law, made to
injure the interests and reputation of
the opposite party (Sony) and should be
dismissed All the allegations and
statements in the complaint are denied,
except that the battery compartment
would not close (which Sony did not
deny) so pictures could not be taken!
Also, curiously, in spite of being a multinational Sony says in its warranty, Not
valid outside India. In theory, this
70-year-old complainant could have
gone on appeal at the state level, but
one visit to the State Commission,
where she could not even get into the
courtroom because of the number of
lawyers crowding into it, plus the prospect of another 10 or more visits, after
spending more money on submitting
five sets of photocopies of all documents
adding up to 41 pages, including the
11-page order from the district forum,
had her deciding to cut her losses and
save her energy.
The Bengaluru forum cites a funds
crunch for demanding stamps and
envelopes. In that case why not display
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clear instructions on the board at the


entrance, along with other instructions?
Because it is not compulsory, says the
staff. Seeking explanations from the
State Commission is pointless as the instructions for collecting stamps came
reportedly from the commission itself. A
query sent to the NCDRC seeking clarification, in April 2013 brought neither a
response nor even an acknowledgement.
Governments Apathy
Having passed the law in 1986, the
government did nothing thereafter.
There were no appointments, no budget
allocation, no infrastructure, until Common Cause, a non-governmental organisation (NGO) founded by H D Shourie,
filed a public interest litigation before
the Supreme Court in 1989. The apex
court ordered the law to be activated
within six weeks. Fearing contempt of
court charges, the government set up
consumer courts hurriedly, but with
scant interest. For example, the district
forum at Mumbais Nariman Point was
housed in decrepit barracks next to a
stinking toilet; some others had no proper
clerical staff, no stenographer to dictate
orders to (so orders reached the parties
after four weeks whereas the limit for
filing an appeal is 30 days). The district
forum at Mysore was set up 10 km from
the nearest bus stop. Consumers convenience was, apparently, not a priority.
Many of the 629 consumer courts
around the country have positions
vacant and cannot function as intended
with a full bench of three adjudicators.
The one at Goa had no president for a
long time, so the president of the forum
at Mumbai went over twice a month. In
April 2013, the Karnataka High Court had
to direct the state government to fill all
18 vacant posts (including presidents) in
consumer courts at Kolar, Bidar, Hassan,
Kodagu, Bengaluru, Shimoga and Yadgir,
within two months. In Maharashtra,
vacancies at consumer courts at Nagpur
and Mumbai were not filled till a judicial
petition was filed. One reason for posts
remaining vacant is that the remuneration offered is not attractive enough for
magistrates to agree to serve on the fora.
Curiously enough, the proposed amendments of 2014 specify a salary for the
21

COMMENTARY

commissioner to be appointed under the


new Consumer Protection Authority on
par with secretaries to the government
(with five deputy commissioners drawing joint secretaries salaries). If raising
the pay is an option, why create a fresh
Consumer Protection Commission (as
the amendment proposes) instead of
making salaries more attractive for those
serving on the existing three-tier mechanism? The amendment also suggests
clubbing of adjacent district fora,6 and
activists wonder how this could facilitate speedy resolution of complaints.
The existing three-tier mechanism was
well intentioned, but official apathy, not
its design, has reduced its effectiveness.
Focus on Justice Lost
In the enthusiasm of the earlier years,
some important landmark orders were
handed out under the CPA. For example,
courier companies used to restrict their
liability in case of delay or loss, to just
Rs 100, by printing a small declaration
to this effect on the receipt. This was
overruled by precedent setting orders
awarding higher compensation in cases
where the complainant was able to
prove loss and deficiency of service. In
complaint No 2302/96,7 the Bangalore
forum awarded compensation for delay
in delivering a packet, ruling that the
arbitrary clause (regarding liability)
imposed on the buyer was unacceptable.
The then president of the Bangalore
forum, Justice Ananthamurthy, even
asked the lawyer representing a company, Can you write anything you want,
on your receipt? That kind of focus on
fair play and justice to the common man
seems to have got lost over the years, despite periodic amendments to the Act to
widen its ambit (to cover builders and
lawyers, government services, and even
Right to Information queries.)
Educational institutions mention on
their receipts that fees once paid will not
be refunded under any circumstances
but the NCDRC has struck this down and
students who withdraw without attending
a single class have received refund
orders under the CPA in several instances.
Dry cleaners receipts used to say their
liability for any loss or damage was
restricted to Rs 100, but this too has
22

been challenged and adequate compensation ordered to be paid. In revision


petition No 1328 (Tip Top Drycleaners vs
Sunil Kumar) the NCDRC said in its order
of 2003 that conditions printed on a
receipt do not constitute a binding
contract.
There was also the celebrated case of
Ranganathan vs Standard Chartered
Bank in which the bank hired thugs to
recover arrears from the complainant
despite his standing instructions for adjusting dues on his credit card, from the
deposits maintained by him. The bank
in its defence cited computer problems,
but the Tamil Nadu State Commission
not only ordered hefty compensation of
Rs 20 lakh plus Rs 5,000 costs, but also
condemned such mafia mentality in a
multinational bank.8 These are, however, rare examples of recent orders that
have strengthened consumers rights.
Today, the degeneration in the functioning of most fora has sabotaged the spirit
and promises of the Act.
Multiple Degeneration
Earlier, complainants used to receive intimation through postcards about dates
fixed for a hearing. No such intimation is
now sent. Even self-addressed reply cards
sent with complaints are not mailed
back. The registrar of each forum used
to be authorised to sign as notary for
affidavits required to be submitted, at no
cost to the complainant. During the
hearing of the complaint against Sony,
the Bangalore forum did not even have
a registrar. Finding a notary involved
additional expense. Such steady degeneration of facilities and entitlements
marks the working of most of the fora
around the country. In spite of having
computer facilities (unlike in the early
years) the fora do not seem to keep
abreast of precedent setting orders from
around the country. Complainants are
expected to cite orders to support their
claims, which the average complainant
cannot. Lawyers, with access to legal
journals, have an unfair advantage,
when they are engaged by manufacturers
against complainants with grievances
about faulty gadgets or deficiency in
service which the consumer courts
ignore. Justice Patnaik of the Orissa

State Commission observed in a


complaint by Arati Mohanty and
Pramodnath Das that the trader.
cannot put a condition at the time of
selling that under no circumstances will
the money be refunded.9 And yet, this
gets disregarded as in the case of the
ruling in favour of Sonys restrictive
warranty clause.
The union minister for consumer
affairs had sent out a circular to all state
chief secretaries in 1999, saying that
the clause goods once sold cannot be
returned or exchanged is unethical and
to be forbidden (DO no II (II) 99-CPU/1647).
Neither the states chief secretaries
nor the union government have bothered to enforce this far-reaching order,
and consumers continue to be at the receiving end of an exploitative relationship as buyers of goods and services, 15
years after such a directive from the
highest authority. As one columnist put it,
the slogan Jago grahak, jago (wake
up, consumer, wake up), coined by the
Ministry of Consumer Affairs, needs to
be reworded, to awaken the department
itself, if the gap between the intentions
of the Act and its implementation is to
be bridged.
Notes
1
2
3
4
5

6
7
8
9

JANUARY 31, 2015

I (1993) CPJ (NC) Consumer Protection Judgments (CPJ).


Law of Consumer Protection in India, by D N
Saraf, N M Tipathi Pvt Ltd, Mumbai, 1995.
In email communication dated 22 October,
2012.
Insight magazine, CERC, Ahmedabad, JanuaryFebruary 2008, p 16 .
Insight, ibid. The proposed amendments of
2014 seeks to forbid representations by lawyers
on both sides but only if the amount involved
in the dispute is under Rs 5 lakh.
Website of the department of consumer affairs
http://consumeraffairs.nic.in
Sakuntala Narasimhan vs Professional Couriers.
IV 2005 CPJ 327.
II (2004) CPJ 554.

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