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Class 12 Business Study Chapter 12 Consumer Protection
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Consumer Protection
Chapter: 12
PART – B
VERY SHORT TYPE QUESTIONS ANSWERS (1 MARK EACH)
1. Consumer protection has a moral justification for business. (Correct/ incorrect)
Ans: Correct
2. What are the rights of a consumer. Write any one.
Ans: Right to safety.
3. Which consumer right gives the business firms freedom to set up their own consumer service and grievance cell ?
Ans: Right to representation or to be heard.
4. Does the Consumer Protection Act provide for six consumer rights. (Correct/ incorrect)
Ans: Correct.
5. ISI is the quality certification mark used in case of food products. (Correct/ incorrect)
Ans: Incorrect
6. Under the Consumer Protection Act, a complaint can be filed by a consumer for defective goods and also for deficiency in service. (True or false)
Ans: True.
7. Can Non-Government Organisations (NGO’s) play an active role in protection consumer of interest.
Ans: Yes, NGO play an active role in protection consumer of interest.
8. Entrepreneurs undertake calculated risk. (correct/incorrect)
Ans: Incorrect.
9. Entrepreneurs take high risk when no alternatives are found. Do you agree ? Give reason.
Ans: It is generally believed that entrepreneurs take high risks. Yes, individual opting for a career in entrepreneurship take a bigger risk that involved in a career in employment or practice of a profession as there is no assured pay off.
10. Risk taking is a non economic function of an entrepreneur. (Correct / incorrect)
Ans: Incorrect.
11. Who is a successful entrepreneur ?
Ans: An entrepreneur who have inner drive to succeed, strong belief in themselves, search for new ideas and innovation, openness to change, competitive by nature, highly motivated and energetic and who can bear all risk and uncertainties is called successful entrepreneur.
12. In entrepreneurship associated with Research and Development. (Correct/ incorrect)
Ans: Incorrect.
B. SHORT TYPE QUESTIONS ANSWERS TYPE-1 ( 3 MARKS EACH )
13. Uma Sarma Purchased a car for Rs. 8 lakhs from an automobile company and found that its engine is defective. Despite many complains the defect was not rectified. He filed a case in the district forum. But he was not satisfied with the order of the district forum and decided to appeal. Suggest him the highest authority where he could appeal.
Ans: State Commission or National Commission.
14. Explain the importance of consumer protection from the point of view of a business.
Ans: Importance of consumer protection from the point of view of business are as follows:
(i) Consumer Orientation: Business is a means to consumer satisfaction. Business without consumers has no relevance. It exits to satisfy certain needs of the consumers by producing and selling want satisfying products. Thus, consumer is the foundation of business. The success of a business firm would depend upon the satisfaction of its customers.
(ii) Use of Social Resources: Business is a trustee of society’s resource Such resources must be used for the benefits of the society and the consumers. In other words, capital, materials, labour, machinery etc. must be used effectively to satisfy the needs of the consumers.
(iii) Long-term Interest: Self-interest of business requires satisfaction of consumers. If a business fails to satisfy the consumers, they will shift over to the products of competitors. Such a business will ce to exist in the long-run. Further, consumer’s faith in an enterprise of prime importance.
15. Name the various acts passed by the Govt. of India which help in protection of consumer’s interests.
Ans: The various acts passed by the Government of India which help in protection of consumer’s interests are given below:
(i) Consumer Protection Act, 1986
(ii) The Indian Contract Act, 1972
(iii) The sale of Goods Act, 1930
(iv) Environment Protection Act, 1986
(v) Essential Commodities Act, 1955
(vi) Water (Prevention and control of pollution) Act, 1974
(vii) Air (prevention and control of pollution) Act, 1981.
(viii) The Agricultural Produce (Grading and Marketing Act, 1937)
(ix) The Bureau of Indian Standards Act, 1986
(x) Drugs and Commodities Act, 1940
(xi) Prevention of Food Adulteration Act, 1954
(xii) The Standard of weights and Measures Act 1976
(xiii) The Trade Marks Act 1999
(xiv) The Competition Act 2002
16. Explain the importance of consumer protection from the point of view of consumer.
Ans: The importance of consumer protection from the point of view of consumers are as follows:
(i) Consumer Ignorance: A consumer may not be aware of his rights and remedies against unscrupulous marketors. Consumer protection creates awaking amongst consumers and they start protesting against anything wrong done by the businessman.
(ii) Wide spread Exploitation: The competitive market as witnessed at present gives more importance to the consumer. But, still there is widespread exploitation of consumer in one way or the other. Consumer protection movement is now helping the consumers to know the reals situation.
(iii) Unorganised Sector: Though there may be some organisations here and there for protecting the interest of consumers but still it is an unorganised sector. Consumer protection has encouraged the formation of consumer organisations for protecting their interest.
17. What are the responsibilities of a consumer ?
Ans: The responsibilities of consumers are as follows:
(i) To provide adequate information to the seller: The consumer has the responsibility to provide adequate information about his needs and expectations to the sellers. This would enable the seller to provide right kinds of products and services to the consumers.
(ii) To exercise caution in purchasing: The consumer must try to get full information on the quality, design, utility, price etc. of the product before purchasing it. Thus, he should not buy blindly.
(iii) To insist on cash memo or receipt: The consumer must get a cash memo or receipt as a proof of purchase of goods from the seller. This would help him in making a complaint to the seller in case of any defect in the goods.
18. Who can file a complaint in a consumer court ?
Ans: Following parties can file a complaint in a consumer court:
(i) Any consumer.
(ii) Any registered consumers associations.
(iii) The central government or any state Government.
(iv) One or more consumers, on behalf of numerous consumers having the same interest and.
(v) A legal heir or representative of a deceased consumer.
19. What kind of cases can be filed in a state commission ?
Ans: A complaint can be made to the appropriate state commission when the value of the goods or services in question, along with the compensation claimed exceeds 20 lakhs but does not exceeds 1 crore. The appeals against the orders of a district forum can also be filled before the state commission.
20. Explain the role of consumer organisation and NGOs in protecting and promoting consumer interests.
Ans: Following are the role of consumer organisations and NGOs in protecting and promoting consumers interests:
(i) They organise campaigns on various consumer issues to create social awareness.
(ii) They organise training programmes for the consumers and make.
them conscious of their rights and modes of redressal of their grievances.
(iii) They interact with businessmen and chambers of commerce and industry for ensuring a better deal for consumers.
(iv) Filling complaints in appropriate consumer courts on behalf of the consumers.
(v) Some organisations may even test the products available in the market and tell consumers about their quality and precautions etc.
C. SHORT TYPE QUESTIONS ANSWERS TYPE- 11( 4 MARKS EACH )
21. What do you mean by consumer protection and what are the remedies ?
Ans: Consumer protection implies assurance against anti-consumer trade practices by the producers or traders. Anti-consumer trade practices include adulteration, sub-standard quality, fractional weights and measures etc. Naturally, curbing such practices through legislative and other measures and taking action against the producers and traders indulging in such practices is the essence of consumer protection.
The remedies available to a dissatisfied consumer through the redressal machinery are as under :
(i) Removal to defects in goods or services supplied by the seller.
(ii) Replacement of goods with new goods of similar descriptions.
(iii) Return of price by the seller or manufacturer to the complainant.
(iv) Payment of compensation if the consumer has suffered any loss.
(v) Not to offer the hazardous goods for sale.
(vi) Discontinue the unfair/restrictive trade practices, and not to repeat them.
(vii) Withdraw the hazardous goods from being offered for sale.
(viii) Provide for adequate costs to the complainants.
22. Explain briefly consumer rights.
Ans: The rights of consumers are given below:
(i) Right to choose: The consumer has a right to choose from available goods. This right will be exercised only if a variety of goods is available.
(ii) Right against exploitation: Consumers have right against exploitation from mal trade practices, false and misleading advertisements.
(iii) Right to information: Consumer has a right to be informed of the quality, price, operational requirements, adverse side effects, if any, and other relevant facts about the products.
(iv) Receive proper satisfaction: He has a right to receive proper satisfaction from goods and services. The goods should satisfy the needs of the consumers.
23. “Consumer has responsibilities too” Elucidate the statement.
Ans: Rights and responsibilities are two sides of the same coin. Alongwith consumer rights, there are some consumer responsibilities also.
The responsibilities of consumers are as follows:
(i) To provide adequate information to the seller: The consumer has the responsibility to provide adequate information about the needs and expectations to the sellers. This would enable the seller to provide right kind of products and services to the consumers.
(ii) To exercise caution in purchasing: The consumer must try to get full information on the quality, design, utility, quantity, price, etc. of the products before purchasing it. Thus, he should not buy blindly.
(iii) To be quality conscious: The consumer should never compromise on the quality of goods. While making a purchase, the consumer must look for standard quality certification marks such as ISI, AGMARK, WOOLMARK, FPO etc.
(iv) To insist on cash memo or receipt: The consumer must get a cash memo or receipt as a proof of purchase of goods from the seller. This would help him in making a complaint to the seller in case of any defect in the goods.
24. What you mean by grades ? Explain.
Ans: Grade or grading means classifying the product on certain accepted benchmarks or bases. The bases of classification can be size, quality etc. Grading is necessary when a company is not following strictly the technique of standardisation. Through grading, the marketer can get higher price for quality product. Grading is generally done in agricultural products like wheat, rice, pulses, mangoes etc.
25. What are the measures of Redressal of grievance ? Explain in brief.
Ans: The Consumer Protection Act provides for three tier machinery for the redressal of consumer grievances at the district level, state and national level as discussed below:
(i) District forum: The district forum will be established by state government in each district which will have following features –
(a) This forum is constituted by three persons. The probability of the forum is of the states of a sessions judge and the other members are persons of integrity and standing one of them should be a woman.
(b) The forum entertains complaints from the jurisdiction of the district.
(c) The district forum can entertain complaints of the value of Rs. 20 lakhs including compensation.
(d) It has the power to settle disputes judiciously.
(e) Any party not satisfied with the decisions of this forum may file an appeal to the state commission within a period of 30 days from the order of district forum.
The state forum have the following features:
(a) A state commission is headed by a person who is or has been a judge of High Court. Besides him there are two members who should be persons of ability, integrity and standing, one of the member should be a woman.
(b) It can entertain complaints from within the state. The cases heard in the form are of the value between 20 lakhs and 1 crore.
(c) Any aggrieved party from the decision of a district forum may prefer an appeal to the state commission.
(d) Any party not satisfied with the decision of this forum may appeal to national commission within a period of 30 days from the date of the order.
National commission has the following features:
(i) The National Commission is headed by a person who is a judge or has been a judge of the Supreme Court. Besides the president, it has four members who are persons of ability, integrity and standing.
One of the members should be a woman.
(ii) It can entertain cases of the value exceeding 1 crore.
(iii) It can also entertain appeals against the judgement of a state commission.
(iv) Any party not satisfied with the decision of this commission may go to the Supreme Court within 30 days from the date of the order.
(v) National commission has the administrative control over the district forums and state commissions.
26. What is meant by standardisation? Explain.
Ans: Standardisation means setting quality standards to achieve uniformity in the product. Standardisation provides consistent quality assurance to consumers. Consumers are assured about the quality of product offered by the seller. It means maintaining of quality standards in order to achieve uniformity in the product. It ensures quality and packing of the product. A consumer becomes familiar with the look of the product.
D. LONG TYPE QUESTIONS ANSWERS (6/8 MARKS EACH)
27. Non-government organisations (NGOs) perform several functions for the protection and promotion of interests of consumers. State any five functions performed by them.
Ans: Same as Q.No 20.
28. What are the different acts passed by the govt. to give Legal protection to consumers ?
Ans: The different acts passed by the government to give legal protection to consumers are as follows:
(i) The Indian Contract Act, 1873: This Act was passed to bind buyer and seller on their promises made in a contract. The Act also provides remedies available to parties in case of breach of contract.
(ii) The Sale of Goods Act, 1930: This Act provides safeguards and relief to customers in case goods are not complying with the conditions and warranties laid down under the Act.
(iii) The Trade Marks Act, 1999: This Act prevents the use of fraudulent marks on products. This Act was introduced in place of Trade and Merchandise Mark Act, 1958.
(iv) Prevention of Food Adulteration Act, 1954: This Act intends to check adulteration of food items and ensure their purity.
(v) The Competition Act 2002: This Act is intended to check monopolies and restrictive trade practices. It was enacted to encourage healthy competition and protect consumers from companies which restrict competition.
29. Explain the rights and responsibilities of a customer.
Ans: See Answer to Question No. 22 & 23.
30. Explain the redressal mechanism available to consumers under the Consumers Protection Act, 1986.
Ans: See Answer to Question No 25.
31. Explain fully the importance of consumer protection under socialistic society.
Ans: See Answer to Question No 16.
32. What are the ways and means of consumer protection ? Explain.
Ans: Consumer protection can be ensured in the following ways:
(i) Self-regulation by the Business Firms: This is the most important thing to be done by a business firm. Many companies laid down standards of quality and norms of customer care to protect the interests of consumers. They have even set up customer service centres and grievance cells to redress the problems and grievances of their customers.
(ii) Business Associations: The premier associations of trade, commerce and industry like Confederation of Indian Industries (CIL) Federation of Indian Chamber of Commerce and Industry (FICCI) etc. have established their codes of conduct to be followed by their members in serving their customers.
(iii) Consumer Awareness: The awareness of consumers about their rights and responsibilities is very important in the present day business world. It would provide them self-protection against the malpractices (eg., low quantity, under weight etc.) of producers and suppliers.
(iv) Consumer Organisations: The consumer can organise themselves and form associations to fight against the malpractices of business houses. Consumer organisations like VOICE, common cause, society of India etc. have contributed a lot the consumer movement.
(v) Government: The government offers protection to consumers by enacting special laws and implementing them. For example the government has enacted Consumer Protection Act (1986), Essential Commodities Act (1955) and several other laws to protect the interests of workers.
33. Explain the rights and responsibilities of a customer.
Ans: See Answer to Question No. 22 & 23,
34. What are the various ways in which the objectives of the consumer protection can be achieved ? Explain the role of consumer organisations and NGOs in this regard.
Ans: 1st Part: See Answer to Question No. 32.
2nd Part: See Answer to Question No. 20.
35. “Consumer Protection Act provides for six consumer rights.” What are those rights ?
Ans: Consumer Protection Act provides six consumer rights. They are:
(i) Right to safety: The consumer has a right to be protected against goods and services which are hazardous to life and health.
(ii) Right to be informed: The consumer has a right to have complete information about the products intends to buy including its ingredients, date of manufacturing price etc.
(iii) Right to choose: The consumer has the freedom to choose from a variety to products at competitive prices.
(iv) Rights to be heard: The consumer has a right to file a complaint and to be heard in case of dissatisfaction with a goods and a services.
(v) Right to seek redressal: The consumer has a right to get relief in case the product or service falls short of his expectations.
(vi) Right to consumer education: The consumer has a right to acquire knowledge and to be a well informed consumer through life.
36. Who can file a complaint? How the consumer grievances. are redressed by the three tier machinery under the Consumer Protection Act?
Ans: 1st Part: See Answer to Question No. 18.
2nd Part: See Answer to Question No. 25.
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