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  • Writer's pictureSophia Satapathy

The Ultimate Guide to Fighting Back Against Consumer Fraud: 4 Landmark Judgements Every Indian Should Know

Updated: Apr 4


4 Landmark Judgements Every Indian Should Know t

Been cheated by a company before? Many consumers in India need help with problems like paying for defective products, being overcharged, or not getting proper services. Companies sometimes lie about what they will provide. This is called consumer fraud, and it happens a lot in India.

The good news is that we have laws to protect consumers. The Consumer Protection Act allows people to go to special courts called consumer forums. Here, consumers can file complaints against companies. In this article, we will look at some real cases that went to the forums. People got their money back, or companies had to stop cheating.

We will also learn how the law works. Understanding your rights is important. You don't need a lawyer at the forums. You can get help if a company cheats you with simple steps. Knowledge is power - now you can be empowered, too!

Common Ways of Consumers Frauds

Some of the common ways the consumers are cheated are as follows: 

  1. Misleading advertisements: Sometimes, companies advertise products or services, exaggerating their features or hiding important information. This misleads customers into buying something that may be better than promised.

  2. Hidden charges and fees: Many companies charge extra money for things like delivery, packaging, or other services without making it clear upfront. Customers have to pay these unexpected charges later, making the final price much higher.

  3. Defective or substandard products/services: Some sellers provide products that must be fixed or broken down soon. Services may also need to be of better quality. Customers are cheated because they don't get what was promised in exchange for their money.

  4. Lack of transparency in pricing and terms: Companies sometimes need to mention the total cost or details like refund/return policies. Small print and legal jargon are used to help customers understand what they are paying for or agreeing to. This makes it difficult for them to make informed choices.

  5. Bait advertising: Advertisements show very low prices to attract customers, but the product is never available at that price. Once people try to buy it, they are shown a much higher cost. This traps customers into purchasing overpriced items.

  6. Forced bundles and subscriptions: Customers wanting one item or service are forced to pay for extra bundled items they don't need. Auto-renewing subscriptions that charge monthly fees without consent are also common. It becomes difficult for people to refuse or cancel these extras.

So, lack of transparency, misleading claims, and hidden charges are common tactics some sellers use to deceive consumers and profit unfairly. People need to be aware of their rights and carefully read all documents to avoid being cheated.

Your Rights as a Consumer

The Consumer Protection Act was introduced in 1986 to protect consumers' interests. According to the Act, anyone who buys goods or avails services for personal use is considered a consumer. This includes individuals, families, and groups of consumers.

As a consumer, you can seek relief in case of unfair or restrictive trade practices. Some of the major rights provided under the Act are:

  • Right to Safety: You can demand safe goods and services that pose no hazard to your health. Products must comply with quality standards.

  • Right to be Informed: Companies must provide all relevant information about the quality, quantity, potency, price, and standard of products and services. You have the right to be aware of all the details.

  • Right to Choose: You can freely choose the products and services that best suit your needs without any restrictive or coercive trade practices.

  • Right to be Heard: If you have any grievances, you can file a complaint with the consumer protection agencies. Your voice and concerns must be heard fairly.

  • Right to Seek Redressal: If there is any deficiency or unfair practice, you can seek remedies like a refund, replacement, compensation, or other relief by approaching consumer courts.

You can file a complaint against manufacturers, service providers, or sellers. The complaint can be filed with the District Consumer Disputes Redressal Forum for relief up to Rs. 1 crore. State and National commissions are approached for relief above Rs. 1 crore.

Some common reliefs available are a refund of the price paid, return of defective goods, replacement of goods, compensation for losses or injury, and discontinuation of unfair trade practices.

 4 Important Consumer Court Judgements

Consumer courts have played a significant role in establishing consumer rights and protecting consumers from unfair practices. Several landmark judgments have strengthened the legal framework for consumer protection in India. Some of the key judgments are:

National Insurance v Hindustan Safety Glass Works

The case of National Insurance v Hindustan Safety Glass Works was one of the earliest judgments in 1982. Hindustan Safety Glass Works manufactured windshields supplied to the National Insurance Company. However, the windshields cracked easily. National Insurance filed a case against the manufacturer in the consumer court. 

In its judgment, the court established that an insurance company could be considered a 'consumer' when it procures goods and services for its customers. This set an important precedent for including businesses and companies under consumer protection laws.

Manjeet Singh v National Insurance Company

Another important judgment was in the case of Manjeet Singh v National Insurance Company in 1997. Manjeet Singh met with a road accident and claimed compensation from his insurance provider, National Insurance. 

However, the insurance company denied the claim. Singh approached the consumer court, which passed an order stating that insurance is indeed a service and that customers who avail of insurance policies are consumers. It directed insurance companies to settle claims promptly and fairly per the terms of insurance policies.

Indian Medical Association v Shantha Biotech

The 1995 case of Indian Medical Association v Shantha Biotech also strengthened consumer rights related to healthcare. Shantha Biotech had developed a hepatitis B vaccine at a lower price than other manufacturers. 

Doctors' body IMA opposed it, questioning the vaccine's efficacy due to lower costs. However, the consumer court dismissed IMA's objections and allowed for the sale of the affordable vaccine, upholding the consumer's right to access healthcare at reasonable prices.

Arvind Shah v Kamlaben Kushwaha

In another 2001 case, Arvind Shah v Kamlaben Kushwaha, the consumer court ruled favor of the complainant Kamlaben Kushwaha. She had purchased medicines from Arvind Shah's medical store, but they turned out to be spurious. 

The court observed that selling fake medicines violates consumer rights and is an unfair trade practice. It ordered compensation for the consumer. This set an important precedent regarding product quality and liability.

These judgments have played a significant role in developing jurisprudence around consumer protection in India.

 Tips to Avoid Getting Cheated

Here are some simple tips to avoid getting cheated as a consumer:

  1. Do your research before making a purchase. Read reviews online from other customers about the company or product. This will help you identify any red flags.

  2. Take your time when shopping. Don't rush into purchases just because of flash sales or deals. Scrutinize the product and bargain over the price if needed.

  3. Keep all important documents safe. Ask for and preserve bills, receipts, warranties, or service records. These will come in handy if any issues arise later.

  4. Know your rights. Be aware of what protections are available under consumer laws in your area, such as your right to a refund if a product is defective. Laws exist to protect consumers from unfair practices.

  5. Ask questions. If a price, features, or after-sales service needs to be clarified, ask the company or seller for details in writing. Verify all promises and claims made to you.

We hope these simple tips help consumers avoid being taken advantage of and understand their rights. 

What to Do if Cheated 

Here are the steps to take if you have been cheated as a consumer:

Send a notice to the company demanding a resolution:

  • Draft a notice on plain paper providing your name, address of purchase, contact details, details of the issue, and documents as proof.

  • Send it by registered post to the company's address and an acknowledgment slip so they cannot deny receiving it.

  • Give them sufficient time to respond and try resolving the issue directly before approaching the forum.

File a complaint at the appropriate consumer forum:

  • Choose the district, state, or national level forum based on your claim amount.

  • Submit your complaint with the requisite fee and copies in the prescribed format.

  • File it within 2 years of the incident, but delays can be minimized if justified.

Present your case during the hearings:

  • You can represent yourself or authorize an agent, like a relative, to present your case.

  • Submit all documents carefully as evidence and highlight where deficiencies exist.

  • Specifically, ask for reliefs like removal of defects, refund, compensation, etc.

Consider appealing higher if needed:

  • You can challenge the order in higher forums by filing an appeal within 30 days.

  • This allows your grievance to be addressed at appellate levels for a fair resolution.

Conclusion

Consumers have important rights when purchasing goods and services. These court cases help protect those rights. The judges make clear rules for companies and shops to follow, and their decisions set examples for similar problems in the future.

We must watch what we buy. Read small letters on products. Keep receipts so we can return things. Know when food expires or when electronics should work. If something goes wrong, don't give up. The law protects consumers and gives them the power to get money back or exchange it. Together, through law, we make businesses better to benefit all people. Stay careful, but have the courage to stand up when cheated. Your voice and case may set guidance for helping many others.

FAQs

What should I do if the company refuses to respond to my notice?

If the company does not respond to your legally sent notice within 30 days, you have strong grounds to file a complaint with the consumer forum. Be sure to mention the notice and lack of response in your complaint.

How long do I have to file a complaint after being cheated?

 As per the Limitation Act, the time limit to file a complaint is 2 years from the incident/cause of action date. However, in cases of latent defects or where the effect of deficiency is not immediately apparent, the period starts from the date you became aware of it.

What if I need proper receipts/documents as proof?

Try to gather as much corroborative evidence as possible, such as emails, messages, testimonials from other customers, etc. Forums also consider the probability of a claim. It's still worth filing to establish your rights.

Can I represent myself in consumer court without a lawyer?

Yes, the consumer protection law allows you to file and represent your case personally without a lawyer. The process is meant to be simple and affordable for consumers.

What if the product defect causes major health issues or injury?

In such cases, you can claim higher compensation for Rent, medical costs, pain & suffering, etc. It's best to consult a lawyer for complex complaints involving substantial financial liabilities.

How long does it take to get relief from the consumer court?

 Consumer forums settle most cases within 3-6 months. However, complex cases or those appealed at higher levels may take 1-2 years. The process is still much faster than civil courts.




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