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NIOS Class 12 Business Studies Chapter 24 Consumer Protection
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Module – 8 : TRADE AND CONSUMER PROTECTION
INTEXT QUESTIONS 24.1
Q. 1. Give five instances of your daily life in which you see yourself as a consumer.
Ans: (i) Journey in a train.
(ii) Using mobile phone.
(iii) Purchasing clothes.
(iv) Consuming bread and butter.
(v) Watching movie in cinema’s.
Q. 2. Put (✓/X) mark in the box provided to identify consumer exploitation.
(a) Turmeric powder sold with mixture of yellow colour.
(b) Purchased a table fan with two years warrantee.
(c) Sale of noodles, marked on the label as 100 gms, but actually it weighs 80 gms.
(d) A passenger traveled in a deluxe bus but the seat was very much uncomfortable.
Q.3. Choose the correct answer:
Mr. Babu bought a packet of fried chips manufactured by ‘Sneha Confectionaries’ from local retailer. On opening the packet, he found that chips were stale and foul smell emitted from it. Name the organisation which can act on behalf of Mr.
babu, to protect his interest:
(a) Tata Consultancy Service.
(b) Reliance Ltd.
(c) Non-governmental organisations.
(d) None of the above.
Ans: (c) Non-governmental organisations
INTEXT QUESTIONS 24.2
Q. 1. What information do you expect to get under the right to consumer education?
Ans: (a) the relevant laws which are aimed at preventing unfair trade practices.
(b) the ways and means which dishonest traders and producers may adopt to deceive the consumers.
(c) the procedure to be followed by consumers while making complaints.
Q. 2. Identify the relevant rights of a consumer being violated in the following instances:
(a) A bottle of acid sold but the cap was not properly sealed.
Ans: Right to safety.
(b) Medicine sold without date of manufacturing and date of expiring printed on its packaging.
Ans: Right to be informed.
(c) Madan bought a cooler with 2 years warranty. The cooler started giving problem within 6 months. Madan approached the seller. The seller did not listen to his grievances.
Ans: Right to be heard.
(d) The seller compels the consumer to purchase the available product.
Ans: Right to choose.
(e) The common consumers are not aware of their rights, right path and procedure for filing the complaints.
Ans: Right to consumer education.
INTEXT QUESTIONS 24.3
Q. 1. State the role of Consumer Protection Councils.
Ans: The Act as amended in 2002 also provides for setting up of Consumer Protection Council at district, state and national level for promotion and protection of the rights of the consumers as laid down in Section 6 of the Act. The councils are required to give wide publicity to the rights of consumers, the procedures for filling complaints by them and provide inputs to consumer movement in the country.
Q. 2. Advise Suresh to adopt the relevant Ways and Means of Consumer Protection in the following case:
(a) Suresh had received a faulty bill from the electricity department and could not settle the matter amicably. Where should he go?
Ans: Lok Adalat.
(b) Suresh wanted to be more informed about consumer protection. What should he do?
Ans: Awareness Programme.
(c) Suresh faced an accident due to the manufacturing defect in the car. He wants to claim compensation from the manufactures. Where should he go?
Ans: Redressal Forums.
(d) Suresh saw a group of 30 small children aged 8 to 10 years harassed by a manufacturer who employed these children. What can he do?
Ans: Public Interest Litigation.
(e) Suresh came to know that a Industry of the nearby area is throwing its waste into the river. What should he do?
Ans: Public Interest Litigation.
INTEXT QUESTIONS 24.4
Q. 1. Give any two reliefs available to a consumer under the CPA 1986.
Ans: (a) Removal of defects from the goods or deficiencies in services in question.
(b) Replacement of the defective goods.
Q. 2. Write Yes or No in the following cases:
(a) Indian Airlines delayed the flight to Guwahati from New Delhi by 8 hrs. Can the passenger file a case in the consumer court?
(b) A lawyer accepted the fee but did not appear in the court for the client. Can the client approach the consumer court for remedy?
(c) Ramesh bought a refrigerator in January, 2004 with a warrantee period of 2 years. In June, 2005 he noticed some defect and asked the company to rectify it. The company did not listen to his complaint. Now in July, 2007 he is thinking to approach the district forum for redressal. Can the forum accept his complaint?
(d) In the nearby area a milkman adulterates the milk with water and sells in the locality. Can all the consumers from a group and file a case?
(e) Mohan bought a product without a cash memo. Can he file a case in consumer court, if exploited?
Ans: No 24.
INTEXT QUESTIONS 24.5
Q. 1. State the level or rank of the head of the following consumer courts:
(a) State Commission.
Ans: High Court Judge.
(b) District Forum.
Ans: District Judge.
(c) National Commission.
Ans: Supreme Court Judge.
Q.2. Where does the remedy lie in the following case?
(a) A boy got drowned in a pool and the compensation claimed is Rs 6 crores.
Ans: National Commission,
(b) The aggrieved party not being satisfied with the order of the State Commission wanted to appeal.
Ans: National Commission.
(c) A builder sold a house and the land was under litigation. The consumer claimed Rs 56 lakhs as compensation.
Ans: State Commission.
(d) A consumer claimed a compensation of
Rs 25,000/ from the manufacturer of a refrigerator.
Ans: District Forum.
(e) The aggrieved party not being satisfied with the order of the district for unwanted to make an appeal.
Ans: State Commission.
Very Short Answer Type Questions:
Q. 1. Give the meaning of Consumer.
Ans: Consumer is a person who buys goods or hires services to be used or consumed by himself/herself or by some one on behalf of the buyer.
Q. 2. What is meant by consumer protection?
Ans: Consumer Protection refers to the measures adopted for the protection of consumers from unscrupulous and unethical malpractices by the business and to provide them speedy redressal of their grievances.
Q. 3. What do you mean by consumer awareness?
Ans: A consumer who is well informed about his rights would be in a position to raise his voice against any unfair trade practices. In addition to this, an understanding of his responsibilities would enable a consumer to safeguard his interest.
Q. 4. State any two examples of consumer exploitation.
Ans: Examples of Consumer Exploitation are:
(i) The after sales service provider of the television set charged Rs 200 as service charge though he repaired the set within the warranty period.
(ii) The tickets issued to different passengers on the same day for the same journey showed the same seat number.
(iii) Penalty of Rs 50 was charged by SBI after issuing the cheque book to the customer showing that the balance available in the account was less than the minimum required balance for issue of cheque book.
(iv) The supply of cooking gas cylinder to the consumers is found to be underweight.
Q. 5. Name the three tier judicial machinery under the Consumer Protection Act, 1986.
Ans: The judicial machinery set up under the Consumer Protection Act, 1986 consists:
(i) District forum.
(ii) State Consumer Disputes Redressal Commission (State Commission). and
(iii) National Consumer Disputes Redressal Commission (National Commission).
Q. 6. Mention any four standard quality certification marks.
Ans: Consumer should look for the standard quality certification marks like ISI, Agmark, FPO, Woolmark, Eco-mark, Hallmark etc. while making the purchases.
Short Answer Type Questions:
Q. 7. State the various publicity measures initiated by the government to increase the level of awareness of consumers.
Ans: To increase the level of awareness among the consumers the Government of India has initiated various publicity measures. It regularly brings out journals, brochures, booklets and various posters depicting the rights and responsibilities of consumers, redressal machineries etc. It observes World Consumer Rights Day on 15 March and National Consumer Day on 24 December. Several video programmes on consumer awareness are broadcasted through different television channels. Similarly, audio programmes are also broadcasted through All India Radio and FM channels. The poster and slogan competition on consumer protection are also organised at various level. To encourage the participation of public in the field of consumer protection the Government has also instituted National Awards to the persons who have done out standing work in this field.
Q. 8. Explain the meaning of Goods and Services as per CPA 1986.
Ans: Under the Consumer Protection Act 1986, the word Consumer has been defined separately for the purpose of goods and services.
(a) For the purpose of goods, a consumer means:
(i) one who buys any goods for consideration. and
(ii) any user of such goods other than the person who actually buys it, provided such use is made with the approval of the buyer.(The expression ‘consumer’ does not include a person who obtains such goods for resale or for any commercial purpose.)
(b) For the purpose of services, a consumer means:
(i) one who hires any service or services for consideration. and
(ii) any beneficiary of such service(s) provided the service is availed with the approval of such person.
Q. 9. Write any two points that describe the role of NGOs in protecting the consumer.
Ans: Consumer organisations and NGOs can play a vital role for consumer protection:
(i) Consumer organisations will educate consumers about their right through published materials, exhibitions, seminars etc.
(ii) Consumer organisations help consumers to find remedies for their problems relating to consumer exploitation.
Q. 10. Explain the composition and jurisdiction of state co mmission.
Ans: (a) Composition: The State Commission consists of a President and not less then two and not more than such number of members as may be prescribed, one of whom shall be a women. The Commission is headed by a person of the level of High Court judge.
(b) Jurisdiction: A written complaint can be filed before the State Commission where the value of goods or services and the compensation claimed exceeds Rs 20 lakh but does not exceed Rs One crore.
Q. 11. State the purpose of creating Consumer welfare Fund.
Ans: Consumer Welfare Fund: The government has created a consumer welfare fund for providing financial assistance to strengthen the voluntary consumer movement in the country particularly in rural areas. This fund is mainly used for setting up facilities for training and research in consumer education, complaint handling, counseling and guidance mechanisms, product testing labs, and so on.
Q. 12. Who can file a complaint for redressal of grievances under the Consumer Protection Act 1986?
Ans: The following persons can file a complaint under Consumer Protection Act 1986:
(a) a consumer.
(b) any recognised voluntary consumer association whether the consumer is a member of that association or not.
(c) the Central or any State Government.
(d) one or more consumers where there are numerous consumers having same interest.
(e) Legal heir or representative in case of death of a consumer.
Long Answer Type Questions:
Q. 13. Explain the needs for consumer protection.
Ans: The main arguments in favour of consumer protection are as follows:
(a) Social Responsibility: The business must be guided by certain social and ethical norms. It is the moral responsibility of the business to serve the interest of consumers. Keeping in line with this principle, it is the duty of producers and traders to provide right quality and quantity of goods at fair prices to the consumers.
(b) Increasing Awareness: The consumers are becoming more mature and conscious of their rights against the malpractices by the business. There are many consumer organisations and associations who are making efforts to build consumer awareness, taking up their cases at various levels and helping them to enforce their rights,
(c) Consumer Satisfaction: Father of the Nation Mahatma Gandhi had once given a call to manufactures and traders to “treat your consumers as god”. Consumers satisfaction is the key to success of business. Hence, the businessmen should take every step to serve the interests of consumers by providing them quality goods and services at reasonable price.
(d) Principle of Social Justice: Exploitation of consumers is against the directive principles of state policy as laid down in the Constitution of India. Keeping in line with this principle, it is expected from the manufacturers, traders and service providers to refrain from malpractices and take care of consumers’ interest.
(e) Principle of Trusteeship: According to Gandhian philosophy, manufactures and producers are not the real owners of the business. Resources are supplied by the society. They are merely the trustees of the resources and, therefore, they should use such resources effectively for the benefit of the society. which includes the consumers.
(f) Survival and Growth of Business: The business has to serve consumer interests for their own survival and growth. On account of globalisation and increased competition, any business organisation which indulges in malpractices or fails to provide improved services to their ultimate consumer shall find it difficult to continue. Hence, they must in their own long run interest, become consumer oriented.
Q. 14. Describe the right of a consumer as per CPA 1986.
Ans: John F, Kennedy, the former USA President, in his message to consumer had given six rights to consumers.
These rights are:
(a) Right to Safety: It is the right of the consumers to be protected against goods and services which are hazardous to health or life. For example, defective vehicles could lead to serious accidents. The same is true of electrical appliances with sub-standard material. Only recently, there were mass protests and boycott of soft drinks due to presence of hazardous pesticides beyond permissible limits. Thus, right to safety is an important right available to the consumer which ensures that the manufacturers shall not produce and sell sub-standard and dangerous products.
(b) Right to be Informed: The right to be informed is an important component of consumer protection. The consumer must be provided with adequate and accurate information about quality, quantity, purity, standard and the price of the goods and services. Now-a-days the manufacturers provide detailed information about the contents of the product, its quantity, date of manufacturing, date of expiry, maximumretail price, precautions to be taken, etc. on the label and package of the product Such information helps the consumers in their buying decision and use of the product.
(c) Right to Choose: The right to choose provides that the consumer must be assured, whenever possible, access to a variety of goods and services at competitive prices. If the market has enough varieties of products at highly competitive prices, the buyers have an opportunity of wide selection. However, in case of monopolies like railways, postal service and electricity supply etc. it implies a right to be assured of satisfactory quality of service at a fair price.
(d) Right to be Heard: The rights to safety, information and choice will be frivolous without the right to be heard. This right has three interpretations. Broadly speaking, this right means that consumers have a right to be consulted by Government and public bodies when decisions and policies are made affecting consumer interests. Also, consumers have a right to be heard by manufactures, dealers and advertisers about their opinion on production, marketing decisions and any grievances of the consumers. Now-a-days, most of the top manufacturers and firms have set up consumer service cells to attend to consumers’ complaints and take appropriate steps for their redressal. Thirdly, consumers have the right to be heard in legal proceedings in law courts dealing with consumer complaints.
(e) Right to Seek Redressal: The consumers have been given the right of redressal of their grievances relating to the performance, grade, quality etc. of the goods and services. If required, the product must be repaired/replaced by the seller/manufacturer. The Consumer Protection Act has duly provides for a fair settlement of genuine grievances of the consumers. It has also set up a proper mechanism for their redressal at district, state and national levels.
(f) Right to Consumer Education: It means the right to receive knowledge and skill to become informed consumer. In this direction the consumer associations, educational institutions and the policy makers can play an important part.
They are expected to impart information and knowledge about:
(i) the relevant laws which are aimed at preventing unfair trade practices.
(ii) the ways and means which dishonest traders and producers may adopt to deceive the consumers.
(iii) insistence on a bill or receipt at the time of purchase. and
(iv) the procedure to be followed by consumers while making complaints.
Effective consumer education leads to an increased level of consumer awareness and help them to enforce their rights more effectively, and protect themselves against fraudulent, deceitful and grossly misleading advertisement, labeling, etc.
Q. 15. Explain the role of consumer organisation for consumer protection.
Ans: Role of Consumer organisations and NGOS: There are more than 500 consumer organisations in India. Many of them are working as Non-governmental organisations (NGOs). Consumer organisations are voluntary associations of consumers. Consumer organisation/Non- governmental Organisations protect the consumers from being exploited from business.
The role of these organisations is described below.
1. To educate consumers about their rights and responsibilities.
2. To inform consumers about the remedies available to them protecting their rights.
3. To organise exhibitions on adulterated products.
4. To arrange talks, seminars, conferences on issues relating to consumers.
5. To publish journals on consumer affairs.
6. To produce films on food adulteration.
7. To run counseling and guidance centers for consumers.
8. To file suits, complaints and write petitions before the courts on behalf of consumers.
Q. 16. Briefly explain the importance of consumer protection to customer.
Ans: Importance of Consumer Protection: The following factors make consumer protection important.
Importance from consumer’s point of view:
1. Ignorant consumers are given information relating to consumer rights and remedies.
2. Redressel agencies support the consumer who need assistance.
3. Large number of consumers are exploited by manufacturers. Consumer protection safeguard, the consumers against unfair trade practices.
4. Sometimes inconveniences like foul smell from the industries, noise of machines etc. cannot be completely controlled. Consumer protection safeguards the consumers for such inconveniences.
Q. 17. A shopkeeper sold you some spices claiming that it was pure. Later a laboratory test showed that these were adulterated. As a consumer what action would you like to take against this wrongful act of the shopkeeper?
Ans: As a consumer I would file a case against the shopkeeper in District Forum seeking following reliefs:
(i) Replacement of the adulterated spices.
(ii) Refund of the price paid.
(iii) Award of compensation for loss or injury suffered.
(iv) Discontinuance of selling adulterated spices.
(v) Provision of adequate costs.
Q. 18. One of your friends has recently bought a washing machine from the market by paying Rs 15,000. After using a day or two he found some mechanical problem in the machine. Immediately he informed the dealer but the dealer did not respond to repair or replace the machine. Now he wants to lodge a complaint in a consumer court. Which consumer court should he go and why? Also state any three possible reliefs the court may order in favour of your friend.
Ans: When the value of goods or services and the compensation claimed is less than Rs 20 lakhs, complaint against the dealer would be filed in District Forum. Accordingly, my friend should go to District Forum because the amount of relief claimed is less than Rs 20 lakhs.
The court may order following reliefs in favour of my friend:
(i) Removal of mechanical problem in question.
(ii) Replacement of washing machine.
(iii) Refund of the price.
(iv) Compensation for loss or injury he has suffered due to machine.
(v) Payment of costs.
Q. 19. Your friend bought a ceiling-fan from an electronic equipments shop. When she fitted the fan at home, she discovered that it was not functioning. The shopkeeper now refuses to exchange the fan or return the money. Where and how can your friend file a complaint to get redressal of her grievance?
Ans: Since the amount of ceiling fan and the compensation claimed is less than Rs 20 lakhs, my friend will file a complaint before District Forum.
My friend can make his complaint in person or by any authorised agent or by post. The complaint can be written on a plain paper duly supported by documentary evidence in support of the allegation contained in the complaint. The complaint should contain the nature, description and address of the complainant as well as the opposite party and the facts relating to the complaint. The complaint should specify the relief sought.
OTHER IMPORTANT QUESTIONS
Q. 1. What is the importance of consumer protection from business point of view?
Ans: Importance of consumer protection from business point of view:
1. Social responsibility of business can be explained by providing quality goods at reasonable price.
2. Business are able to satisfy its consumers by providing right quality products. This helps them to retain its consumers and it serves the long term interest of business.
3. Government intervention may spoil the image of business if they follow unfair trade practices. Business firms which violate the laws are likely to lose customers and goodwill forever.
4. Business enterprises are morally brunt to be honest in their dealings with the public.
Q. 2. Write the name of some consumer organisations that have been playing an active role in taking up consumer cause.
Ans: Some of the important Consumer Organisations that have been playing an active role in taking up consumer cause are:
(i) CERC (Consumer Education and Research Centre), Ahmedabad
(ii) VOICE (Voluntary Organisation in the Interest of Consumer Education), New Delhi
(iii) CGSI (Consumer Guidance Society of India). Mumbai
(iv) CAG (Consumer Action Group), Chennai
(v) CUTS (Consumer Unity and Trust Society), Jaipur
(vi) Common Cause, New Delhi
(vii) Consumer Education Centre, Hyderabad
(viii) Karnataka Consumer Service Society, Bangalore
(ix) Kerala State Consumers Coordination Committee, Cochin.