|
Introduction:-
In today’s scenario it is usually found that the prices of consumer
goods traded in the markets are settled arbitrarily by the
manufacturers. Even you can realize that in a market where within
one city, different products have different rates of taxes, it
becomes very difficult for consumers to check whether retailers
are actually charging the correct amount of local taxes on the
products they sell. Therefore the confusion in respect of price of
the goods is natural for the consumer and the manufacturers gain
huge profit as the actual manufacturing cost is very low. The
manufacturers arbitrarily fix the price and the consumers are
compelled to purchase goods at higher costs.
Under the
Weights and Measures (Packaged Commodities) Rules, all packed
goods should carry certain essential information on the contents
of the package, such as its weight or volume, the name and address
of the manufacturer, the date of manufacture, and in case of food
packages, the best before date and, of course, the maximum retail
price (MRP).
Under the
Consumer Goods (Mandatory Printing of Cost of Production and
Maximum Retail Price) Act, 2006, certain guidelines has been
provided so that the consumer can not charged over to the maximum
price printed on the goods by the manufacturer. These guidelines
are as follows:
1.
consumer
goods mean all goods and items brought in the market for sale and
are meant for the use and consumption of the consumers;
2.
cost of production means cost incurred directly or indirectly
by the manufacturer in the production of goods;
3.printing means printing of the cost of production and retail
price at a visible place on the product in Hindi and English and
the local language of the place it is sold; and
4.
maximum retail
price
means such price at which the product shall be sold in retail and
such price shall include all taxes levied on the product.
The
legislation has made it mandatory for the manufacturers to
printing of cost of production and maximum retail price on
packaging of consumer goods, so that the consumer could not get
overcharged by the agents/dealer.
It is
essential for the consumers to know the difference between the
maximum retail price and actual price of the goods. The maximum
retail price is inclusive of all taxes and a retailer can sell at
a price below the MRP. In fact consumers should always look for
retailers who sell below the MRP because the MRP is the maximum
retail price allowed for that commodity and not the actual price
and a retailer can well reduce his margin built into the MRP.
While on the other hand, the actual price could be about 10-15 per
cent lower than the MRP. Sometimes the printed MRP is so high that
the difference between the selling price and the MRP can be as
much as 30-50 per cent. It is an offence to sell at a price higher
than the marked price. Whereas the actual price could be about
10-15 per cent lower than the MRP.
Some times it
has been found that the consumers go to market and take products
from the shops without even looking the MRP written on the
packaging and carton of the products. In that situation dealer
told the price of the products to the buyer and also sates that I
would give you on discount rate. After buying the same when buyer
comes back to home than only he/she finds that the price of the
goods mentioned on the packaging and carton is already less than
the price on which he/she has bought after discount. Under the
Standards of Weights and Measures (Packaged Commodities) Rules,
manufacturers have to specify on all pre-packed goods meant for
retail sale, the MRP inclusive of all taxes. This is a requirement
meant to ensure that consumers are not misled by the agents/dealer
and shopkeepers about the price of packed goods. Overcharging is
an offence for which the trader can be prosecuted and prosecution
can be launched against the manufacturer in case the packaged
commodities bears the price which is altered. In the
above-mentioned case, the dealer takes advantage of the fact that
the consumer could not see the packaging and quoted a higher MRP.
Sometimes
it also happens that the manufacturer increases the price of a
products and sells old stocks/products on new price rates and if
buyers ask the reason they simply answer that the Price has
increased because of the changes in duties or increase in the cost
of production and the new packages carry the revised MRP.
Obviously, this new price does not apply to the stock already with
the retailer. And this is where retailers try to make a quick buck
by trying to sell the old stock at the new revised rate, even
though doing so is an unfair trade practice.
On the similar
issue a complainant filed a complaint case before the apex
consumer court. The issue involved in the complaint was that the
complainant went to purchase a product namely tarpaulin
(Waterproofed Canvas), the price mentioned on the ‘duckback baby
sheet’ purchased by him was Rs 92, but the seller asked him to pay
for Rs 112 along with the statement that the price of the sheet
was actually Rs 124 but it had an old label indicating the MRP as
Rs 92. So after discussion, the price was settled between them
(the seller and the buyer) at Rs 112.
In the above
said matter the State Commission held that if the old label on the
product indicated Rs 92 as the MRP, then charging more than what
has mentioned on the packaging is illegal and the activity of the
seller constitutes an unfair trade practice. And as a punishment
for indulging in such a practice, the commission used the
relatively new provision in the Consumer Protection Act to impose
exemplary damage and asked the seller to pay the consumer punitive
damages of Rs 10,000.
The apex
consumer court, before which the seller filed an appeal, said it
fully agreed with the view of the state commission. While doing
so, it pointed out that if the price had been increased from Rs 92
to Rs 124 due to increased cost of production and transportation,
which would apply only to the new stock. The price of the old
stock cannot change. In the circumstances, the old stock cannot be
sold at the new price. Therefore, the state commission was right
in imposing exemplary compensation. (M/S Cargo Tarpaulin
Industries Vs Sri Mallikarjun B.Kori, revision petition number
2132 of 2007, decided on July 5, 2007). It is an offence to sell
at a price higher than the marked price. It is for this reason
that manufacturers provide a more than adequate cushion for dealer
margins while marking the MRP. Whereas it is specifically
mentioned Under the Consumer Goods (Mandatory Printing of Cost of
Production and Maximum Retail Price) Act, 2006 that No person
shall sell or cause to be sold any consumer goods without the cost
of production and maximum retail price of the product printed on
such product after the expiry of six months from the date of
coming into force of this Act.
Forum For
Redressal
The aggrieved complainant may file a complaint before the proper
Forum and can get redressal. Several important Acts and laws have
been announced by the legislation. These Acts are followings:
Monopolies and Restrictive Trade Practices Act (hereafter "MRTP
Act") and the Essential Commodities Acts, Environment Protection
Act and the most significant Consumer Protection Act. The Consumer
Protection Act, 1986 (hereafter "the Act") is a remarkable piece
of legislation for its focus and clear objective, the minimal
technical and legalistic procedures, providing access to redressal
systems and the composition of courts with a majority of non-legal
background members.
The Consumer
Protection Act establishes a hierarchy of courts, with at least
one District Forum at the district level, a State Commission at
the State capitals and the National Commission at New Delhi. The
pecuniary jurisdiction of the District Forum is up to Rs. one lakh
and that of the State Commission is above Rs. one lakh and below
Rs. 10 lakhs. All claims involving more than Rs. 10 lakhs are
filed directly before the National Commission. Appeals from the
District Forum are to be filed before the State Commission and
from there to the National Commission, within thirty days of
knowledge of the order.
Under the Act, a consumer or any registered voluntary consumer
association or any Central or State Government can make a
complaint. A "consumer"
is a person who buys any goods or hires any service for
consideration, paid or promised or partly paid or under deferred
payment. This includes any user of such goods or services when
such use is made with the approval of the person who paid or
partly paid etc. However, goods obtained for commercial purposes
or for resale are not covered under the Act.
Complaints can
be made against
(a) unfair trade practices by which complainants
suffer loss or damage;
(b) goods that suffer from one or more
defects; or
(c) deficient service.
The procedure
adopted by the Forum or Commission on receipt of a complaint is to
refer a copy of the complaint to the Opposite Party directing them
to file their version within thirty days or such extended period
not exceeding fifteen days at a time. The Forum or Commission has
the powers vested in a civil court and these include the power to
summon and examine witnesses, requisition reports of analysis or
tests from appropriate laboratories and to receive evidence by way
of affidavits.
Based on its findings, the Forum or Commission can grant a
direction to the Opposite Party to remove the defect, replace the
goods free of defect, or refund the charges paid for the goods or
service and to pay compensation for the loss or injury suffered by
the complainant. Such directions are to be treated as if it was a
decree of a court, and non-compliance can amount to imprisonment
Other Laws
That Impact Consumers
Essential Commodities Act: Any complaint of hoarding or unfair
trade practice against the thirty-four commodities listed as
essential commodities under this Act can be preferred to the
special courts established under the Act.
Standards of
Weights and Measures Act and Rules:
This Act prescribes standards for the weights and measures used in
trade. These standards ought to be certified by the Bureau of
Indian Standards (BIS) and
contain the "ISI" mark. This also prescribes rules for packaged
commodities. The rules explain the details that a package should
contain - like the maximum retail price (MRP), weight of the
commodity, date of manufacture and expiry.
MRTP Act: This
Act establishes a Central Commission to initiate suo motu action
against restrictive and unfair trade practices and also to hear
and pass orders on complaints. The aim of the Act is to stop any
trade practice that may have the effect of preventing, distorting
or restricting competition or causes loss or injury to consumers.
Prevention of
Food Adulter-ation Act:
This Act contains stringent provisions against adulterators of
food articles. The Act also prescribes a set of officers to check
the quality and quantity of food in public establishments.
Drugs and Cosmetics Act: This Act prescribes officers to enforce
its various provisions and also prescribes stringent action
against manufacturers of drugs and cosmetics for violations under
this Act.
Conclusion:
All such legislations and rules would become effective if
consumers know their rights and duties and perform accordingly.
Consumers
Right
1. Right to Safety: To be protected against the sale of goods and
services which are spurious/hazardous to life.
2. Right to information: To know the quality, quantity, weight and
the price of goods/services being paid for, so that you are not
cheated by unfair trade practices.
3. Right to choose: To be assured wherever possible, access to a
variety of goods and services at a competitive price.
4. Right to be heard: To be heard and be assured that your
interest will receive due consideration at appropriate fora.
5. Right to Seek Redressal: To seek legal redressal against unfair
or restrictive trade practices or exploitation.
6.
Right to Consumer Education:
To have access to consumer education.
Consumers
Responsibilities
1) Obtain full information regarding quality and price before
making any purchases.
2) Be careful, about false and /or misleading advertisement
3) Purchase goods having quality marks like ISI/Agmark etc. as and
where available, for safety and quality.
4) Obtain proper receipt/cash memo for purchases made and
guarantee/warranty card duly stamped and signed by the seller,
wherever applicable.
5) Approach Consumer Forum for redressal of consumer grievances
against sale of defective goods or deficient services or adoption
of unfair restrictive trade practices.
Precautions
For Consumers:
1. Purchase only when you need and do not purchase in a hurry.
2. Do not buy blindly. Demand full information before you buy.
3. Beware of false/misleading advertisements.
4. Do not compromise on the quality of goods and services and its
quality. Purchase only quality products.
5. Do not forget to obtain proper receipt/cash memo. Always obtain
the guarantee/warranty card duly stamped and signed by the
shopkeeper, wherever necessary. These can be helpful in consumer
courts
|
More
Articles:
The
author can be reached at: binitashahi@legalserviceindia.com /
