JKJ 2004 (1) J-1

Genesis Of Consumerism In India

By:- Dr. Ajeet Lal (M.A., LL.M., Ph.D., Formerly Lecturer, Faculty Of Law, University Of Jammu, Jammu)

GENESIS OF CONSUMERISM IN INDIA

I. Introduction

In the ancient time “Barter System” was prevailing in India. The term “Barter” means exchange of goods for goods. The farmers were producing maximum items from their fields and extra items they were Bartering for the things they needed. There was hardly any sale or purchase with money, because the people were having more goods but very less money to purchase the things of their need. In the “Barter System” everybody produced best quality of goods or services and exchanged them. Hence, there was no problem for the consumers. However, with the introduction of more efficient power and machinery into manufacturing and improved transportation, accompanied by the widening of markets, control by the consumer over the quality and prices of the goods and services offered to him has progressively diminished.

Before the Second World War the philosophy of “Laissez Faire” was prevailing in India, in which the main duty of the Government was to maintain the law and order. The ideology of Police State was prevailing in the countries. The government was having less interference in the production, distribution and consumption of the goods. Gradually, laissez faire ideology was abolished and the Welfare State ideology was adopted, in which State performs all the welfare activities. Under the Welfare State scheme it interferes with the production, distribution and consumption of the goods. Even the Constitution of India has been framed on the footing of Welfare State. The objects of the Constitution are to strengthen and promote the concept of Welfare State by seeking to lay down some socio-economic goals. The modern consumerism has born more than 50 years ago. It has become an important means to achieve just and fair society. The consumerism in India is evolutionary in its nature. The consumerism in India had also faced teething problem like a child.

Due to the mass consumption and production, the variety of goods offered for sale has increased to such an extent that no one could be expert in judging the goods. The Consumers are facing an information gap, when they enter into transactions involving the purchase of products. Technological advancement has made consumer products complicated in such a way that for layman it is very difficult to understand the true nature of the goods or services. The purchaser has neither time nor opportunity to compare quality and price throughout the whole range of markets. The art of production also has become so complex that it is impossible, to recognize merits in the product and the art of analyzing the quality of consumption of goods had advanced to a stage of expertness which the individual consumer has never had the skill or the facilities to exercise. The poor consumer faces many problems in evaluating the products. He is supposed to judge differences of technology, function, price and promotion on the basis of commercial as well as non-commercial information that is occasionally misleading, often irrelevant and always imperfect.

There has been a virtual explosion in the range of consumer goods available in the market, surpassed only by complaints regarding their quality. The modern business methods have greatly increased the hazards of the consumer by introducing new and subtle forms of deficit. The main methods of cheating are the use of short weight and measures, the adulteration of products and the misrepresentation of the articles for sale. The monopoly of business is a great problem faced by the consumer. Now it has been realized that the interests of the consumers are threatened when a substantial part of the output of an industry is under one control.

India is developing country and is facing many problems including illiteracy. The majority of consumers are illiterate, hence, they do not know their rights under various legislations. They could not organize themselves against the unfair trade practices. The business people exploited the consumer at every step. The thrust of this paper is to explore the genesis of consumerism in India.

II. Concept of Consumerism

The concept of consumerism means the welfare of the consumers by safeguarding their rights by giving required protection to them from Restrictive and Unfair Trade Practices and also from the goods and services injurious to them and to save them from economic exploitations by the well organized and trained sellers, traders, manufacturers of goods and services. The exploitation of the consumer is a white collar crime without mens rea of the sellers, traders and manufacturers. The white collar crimes of adulteration of food, selling goods injurious to public health, selling narcotic drugs, liquor, pan masala, cigarettes, obscene literature etc. are committed by some of the sellers. The sellers are committing socio-economic crimes by adopting Restrictive and Unfair Trade Practice. The consumerism prevents such illegal, unfair trade practices and socio-economic crimes.

The consumerism came into existence in the early 1960, when it was coined by the business community in the Western World especially in United States. It is a social force designed to protect the interests of consumers in the market place by organizing the consumers to bring pressure on business community to pay heed to their problems. The consumer organizations could provide united and organized efforts to fight against unfair marketing practices and to achieve consumer protection. The balance of power in the market normally rests with the sellers. The sellers are protected by the doctrine “Caveat Emptor” which means let the buyer beware. Consumerism is society’s efforts to set right the imbalance in the exchange of goods and services between sellers and buyers.

The consumerism is based on the doctrine of “Caveat Vendor” which means let the seller beware. The consumerism engaging in actions intended to stir public opinion and generate public pressure on the unscrupulous and erring manufacturers. The consumerism stands for the organized efforts of consumers seeking to redress, restitute and remedy for the dissatisfaction of the standard of living. It is a social movement seeking to challenge the rights and powers of the buyer in relation of seller. The consumerism is a movement by the people, of the people and for the people. It is by the people because the role of common man is called for struggle against the unscrupulous businessmen.

The consumerism is the dire need for the refinement in marketing practices by revamping them to be more truthful, efficient, informative, responsive, sincere transparent and making the business house relating about quality of life. Consumer protection is an action of the society which is created to attain the well being of consumers. Since, an individual consumer is considered more vulnerable, in the modern world, to exploitation and harassment by the manufacturers, distributors and sellers. It is necessary that the various groups of society such as government, judiciary and voluntary associations of consumers etc. play their role to protect and promote the consumer interests such as economic, social and environment.

The fundamental cause of consumerism in India is due to consumer dissonance which means the consumer gets doubts, disillusionment and dissatisfaction after the purchase of the items. The real need for consumer protection arises because the consumer needs protection against products, services, which are spurious, unsafe, endanger health, property, unfair trade practices, abuse of monopoly, restrictive trade practices, against the manufacturers and sellers.

III. Consumerism under Various Legislations

Before 1986 the consumerism in India developed through various legislations. The consumer was protected under Indian Penal Code, 1860 Indian Contract Act, 1872, Sale of Goods Act, 1930, Law of Torts, Drugs and Cosmetics Act, 1940, Essential Commodities Act, 1955, Monopolies and Restrictive Trade Practice Act, 1969 etc. Though the consumer was protected under various legislations but it was costly and the time consuming remedy. Moreover, the consumer was confused under which legislation he could get the remedy. Hence, there was a need for specific legislation to improve the consumerism in India.

IV. Consumerism under Consumer Protection Act, 1986

The consumerism considerably developed in India under the Consumer Protection Act, 1986 (hereinafter referred as C.P. Act, 1986). The C.P. Act, 1986 was enacted after considering the need to provide speedy redressal to consumer grievances and being cognizant of the deficiencies in existing administrative and legal arrangements for comprehensive consumer protection legislation needed. The C.P. Act, 1986 is the most powerful piece of legislation the consumer has today because now the consumer need not to roam without aim due to earlier multiplicity of legislations and enforcement agencies. The C.P. Act, 1986 is the first concrete step towards establishing the sovereignty of the consumer in the market. It has given number of powers to the consumer and consumer organizations to fight against the unscrupulous and erring manufacturers and traders.

The provisions of the C.P. Act, 1986 are in addition to the provisions available under other laws for the protection of consumer which are for the time being in force. The C.P. Act, 1986 has brought services, public utilities, nationalized undertakings, public corporations besides the private sector under its purview. Before the enactment of C.P. Act, 1986 the Monopolies and Restrictive Trade Practice Act, 1969 was prevailing in India but the Monopolies and Restrictive Trade Practice Commission had power only to deal with private sector and the public sector was excluded from its purview. Now C.P. Act, 1986 has also brought in its purview the Government Sectors which are responsible for providing goods and services to the consumers. The C.P. Act, 1986 provides that complaint can be filed by the consumer as well as consumer organizations. The C.P. Act, 1986 confers rights to the buyer as well as user of the goods to claim damages for defective goods and services. The Consumer Protection Councils are establishe at State and Centre level. Recently, by the Consumer Protection (Amendment) Act, 2002 (hereinafter referred as C.P. (Amendment) Act, 2002) provides that Consumer Protection Council shall also be established in every district.

The C.P. Act, 1986 provides a quasi-judicial machinery to redress the grievances of the consumer by awarding the compensation to the aggrieved consumer. Under the C.P. Act, 1986 the pecuniary jurisdiction of the District Consumer Forum was Rs. 1 lakh, State Commission Rs. 10 lakhs and National Commission more than Rs.10 lakhs respectively.

The Consumer Protection (Amendment) Act, 1993 (hereinafter referred as C.P. (Amendment) Act, 1993) provides some improvements in the consumerism. A member of District Forum who was supposed to be a lady Social Worker now under C.P.(Amendment) Act, 1993 a woman as member with qualification alike other members laid down will be selected as a member of the Foras. The provisions for method of appointment on the recommendations of the Selection Committee provided to select the President and members of District Forum, State Commission and National Commission. The pecuniary jurisdiction was enhanced for District Forum from Rs.1 lakh to Rs. 5 lakhs, State Commission from Rs.10 lakhs to Rs. 20 lakhs and for National Commission from more than Rs. 10 lakhs to more than Rs.20 lakhs, under C.P.(Amendment) Act, 1993.

The consumerism has undergone many changes under the C.P.(Amendment) Act, 2002 because the experience of working of the C.P.Act, 1986 and C.P.(Amendment) Act, 1993 has brought out many shortcomings and the need of judicial delivery system through Redressal Agencies with the passage of time having changed, had been the necessity of such overhauling the system as a whole. The original pecuniary jurisdiction of various foras constituted under the C.P. Act, 1986 and C.P. (Amendment) Act, 1993 has been substantially increased by C.P. (Amendment), Act 2002. The District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed does not exceed Rs.20 lakhs. The State Commission shall have the pecuniary jurisdiction where the value of goods or services does not exceed Rs.1 crore. The National Commission shall have the power to entertain the complaint when the value of goods or services is exceeding Rs.1 crore.

In short, the improvement in consumerism under C.P. (Amendment) Act, 2002 may be traced to the concern of the Parliament to avoid delay in proceedings before the Consumer Fora , grant of more relief to the consumers, reduce large number of complaints and appeals pending before the Consumer Fora, Creation of Benches, Circuit Courts of the State Commission and of the National Commission, to provide for transfer of cases, ex-parte proceedings, review of orders and interim relief in the interest of justice and to enforce the orders of the Consumer Fora.

However, under C.P.(Amendment) Act, 2002 the interest of consumers has been affected to their detriment by levy of Court fees due to the necessity of depositing 50% amount ordered to be paid if appeal is to be made but this could not be the only way to reduce the number of complaints and appeals. It would cause denial of justice to consumers in certain cases. The C.P. (Amendment) Act, 2002 provides for the exclusion of service of commercial nature from the purview of the Consumer Foras. Thus, when the services of commercial nature are excluded from the jurisdiction of Consumer Foras, it would itself reduce their work load upon the Consumer Foras.

The provisions regarding the levy of court fee could have been avoided to provide the cheapest remedy to the aggrieved consumers. On the other hand, change of pecuniary jurisdiction would also reduce original complaints before the State Commission and National Commission. The procedure provided to avoid the delay in disposing of consumer disputes is a welcome step for the development of consumerism in India. If it is carried out by the Consumer Fora with the spirit and zeal, it would enhance the consumer protection movement in India under C.P.(Amendment) Act, 2002. The Consumer Fora could serve better the interests of consumers with the enhanced jurisdiction to grant the relief. The provisions for transfer of cases, ex-parte proceeding, review of orders and interim relief in the interest of justice and to enforce the orders of the Consumer Foras are again for the proper functioning of the Consumer Fora and for removing the difficulties faced by them which experience has brought forward.

V. Conclusion

In conclusion the consumerism in India has developed by evolutionary and in phased manner. It started from barter, then changed to laissez faire. Later on the consumerism made progress under various legislation in India. Finally, the consumerism reached to specific legislation of C.P. Act, 1986, C.P.(Amendment) Act, 1993 and C.P.(Amendment) Act, 2002, which is a powerful piece of legislation in the hands of consumer, presently to fight against the unscrupulous and erring manufacturers and traders. The C.P.(Amendment) Act, 2002 has overhauled whole consumer law by providing more relief to consumers, reducing large number of complaints and appeals pending before the consumer Redressal Agencies. It has created Benches, Circuit Courts of the State Commission and National Commission. But by introducing the payment of court fees to be paid by the consumer has hampered the interest of the consumer though the object may be to reduce the number of complaints and appeals in the Consumer Foras.