NCERT Solutions Class 12 Business Studies Chapter 12 Consumer Protection

NCERT Solutions for Class 12 Business Studies Chapter 12 Consumer Protection true or false

State whether the following statements are true or false.

Question. Consumer protection has a moral justification for business.
Answer: True.

Question. In addition to rights, a consumer also has some responsibilities.
Answer: True.

Question. A complaint can to be made to a District Forum when the value of the goods or services in question, along with the compensation claimed, exceeds ` 20 lakhs.
Answer: False.

Question. The Consumer Protection Act provides for six consumer rights.
Answer: True

Question. ISI is the quality certification mark used in case of food products.
Answer: False

Question. Under the Consumer Protection Act, a complaint can be filed by a consumer for a defective good and also for deficiency in service.
Answer: True

NCERT Solutions for Class 12 Business Studies Chapter 12 Consumer Protection Short Answer Type Questions

Question. Explain the importance of consumer protection from the point of view of a business.
Answer: Consumer protection is important for businesses due to following reasons:

1. Long term interest: It is the businesses' long term interest to satisfy their customers. Satisfied customers lead to repeat sales, goodwill and thus lead to profit maximisation for the firm.
2. Business uses society's resources: Business have a responsibility to supply such products and render such services which are in public interest.
3. Social responsibility: Business has social responsibility towards different interest groups, mainly consumers. Business needs to supply good quality products and reasonable prices to consumers.
4. Moral Justification: It is the moral duty of any business to take care of consumer interests and avoid any form of exploitation. Business must avoid any unscrupulous and unfair trade practices for their own interests.
5. Government Intervention: A business engaging in exploitative trade practice would attract government intervention, which can spoil the image of business. Thus, it should voluntarily not resort to such practices.

Question. Enumerate the various Acts passed by the Government of India which help in protection of consumers’ interests.
Answer: Various Acts passed by the Government of India which help in protection of consumers’ interests are:

• Consumer Protection Act, 1986
• Contract Act 1872
• Sales of Goods Act, 1930
• Agriculture Produce Act, 1937
• Prevention of Food Adulteration Act, 1954
• Essential Commodities Act, 1955

Question. What are the responsibilities of a consumer?
Answer: A consumer should keep in mind certain responsibilities while purchasing, using and consuming goods and service.

The responsibilities that consumer needs to exercise while purchasing the ornaments are:

1. Should buy only standardized goods as they provide quality assurance.
2. Should read labels carefully so as to have information about prices, weight, manufacturing etc.
3. Should ask for cash memo on purchase of goods and services as it serves as a proof of the product.
4. Should learn about the risk associated with products and services and follow manufacturer’s instructions and use the products safely.

Question. Who can file a complaint in a consumer court?
Answer: The following persons can file a complaint under Consumer Protection Act, 1986:

1. A consumer;
2. Any recognised voluntary consumer association whether the consumer is a member of that association or not;
3. The Central or any State Government;
4. One or more consumers, on behalf of numerous consumers having common interest;
5. Legal heir or representative in case of death of a consumer.

Question. What kind of cases can be filed in a State commission?
Answer: This is established by the State Government in the state. Only those complaints can be filed with State Commission where the value of goods or services and compensation claimed is between twenty lakhs to one crore. Also, appeals against the orders of any District Forum can be filed before the State Commission.

Question. Explain the role of consumer organisations and NGOs in protecting and promoting consumers’ interests.
Answer: In India, several consumer organisations and non-governmental organisations (NGOs) have been set up for the protection and promotion of consumers’ interests. Consumer organisations and NGOs have undertaken various activities as part of the consumer movement.

They perform several functions like:

1. Creating awareness about consumer rights and educates the general public about consumer problems and remedies through seminars, workshops and training programmes.
2. Providing legal aid to consumers by way, of assistance in seeking legal remedy.
3. Filing complaints in relevant consumer courts n behalf of consumers and undertaking advocacy of consumers’ point of view as representative members of consumer protection councils and others official boards.
4. Arranging comparative testing of consumer products through their own testing apparatus or accredited laboratories so as to evaluate the relative qualities of competing brands and publish the test results for the benefit of consumers to become informed buyers.
5. Publishing periodicals and journals to disseminate information among readers about consumer problems, legal reporting and other emerging matters of interest.

NCERT Solutions for Class 12 Business Studies Chapter 12 Consumer Protection Long answer Questions

Question. Explain the rights and responsibilities of a consumer.
Answer: According to the provisions of the act consumers have been granted following six rights:

1. Right to safety: Certain goods may cause serious injuries. If there is any manufacturing defect in the goods, consumers have right to be protected against these fatal risks. The consumers protection act safeguards consumers’ interest.
2. Right to be informed: A consumer has the right to be informed about the quality, quantity and price of the product. He should also be informed about the ingredients of the product, date of manufacture and expiry, method of use, side effects of the commodity and precautions to be undertaken. The information should be written on the package or on the separate piece of paper.
3. Right to choose: The consumer has the right to choose the product of his choice out of the alternative products available. Manufacturers should offer a wide variety of products in terms of quality, brand, size, etc, so that consumers can make their choice.
4. Right to be heard: Every consumer must be granted right to be heard. He must be assured that its complaints and grievances about the product and services will be heard and attention paid to it.
5. Right to seek redressal: Consumers have the right to get their claims settled in their favour in case of being cheated and exploited by the producer. The government has set up many consumer courts for this specific purpose.
6. Right to consumer education: The consumer must be educated about the rights, he has been granted by the law to protect his interest.

A consumer should keep in mind the following responsibilities:

1. Be aware about various goods and services available in the market.
2. Buy only standardised goods as they provide quality assurance. Thus, look for ISI mark, FPO mark, Hallmark, etc.
3. Learn about the risks associated with products and services and follow manufacturer’s instructions.
4. Read labels carefully so as to have information about prices, net weight, manufacturing and expiry dates, etc.
5. Assert yourself to ensure a fair deal.
6. Be honest in your dealings. Choose only from legal goods and services and discourage unscrupulous practices like black-marketing, hoarding, etc.
7. Ask for a cash memo on purchase of goods or services.

Question. What are various ways in which the objective of consumer protection can be achieved? Explain the role of consumer organisations and NGOs in this regard.
Answer: Ways in which the objective of consumer protection can be achieved are:

1. Consumer education: A consumer must be aware and educated about his rights and responsibilities. He must also be aware of relief available.
2. Formation of business associations: Associations such as FCCI and CII should be formed.
3. Self regulation by business: A business must realise that interest of consumers should be kept in mind at all the stages of product development and selling.

In India, several consumer organisations and non-governmental organisations (NGOs) have been set up for the protection and promotion of consumers’ interests. Consumer organisations and NGOs have undertaken various activities as part of the consumer movement.

They perform several functions like:

• Creating awareness about consumer rights and educates the general public about consumer problems and remedies through seminars, workshops and training programmes.

• Providing legal aid to consumers by way, of assistance in seeking legal remedy.

• Filing complaints in relevant consumer courts n behalf of consumers and undertaking advocacy of consumers’ point of view as representative members of consumer protection councils and others official boards.

• Arranging comparative testing of consumer products through their own testing apparatus or accredited laboratories so as to evaluate the relative qualities of competing brands and publish the test results for the benefit of consumers to become informed buyers.

• Publishing periodicals and journals to disseminate information among readers about consumer problems, legal reporting and other emerging matters of interest.

Question. Explain the redressal mechanism available to consumers under the Consumer Protection Act, 1986.
Answer: Following are three redressal forums set up to deal with consumer grievances and disputes:

District Forum:

1. This is established by the State Government in each district. The salient features of this Forum are as under:
2. It shall consist of a chairman and two members appointed by the State Government.
3. Only those complaints are filed where the value of goods or services and the compensation claimed is less than rupees twenty lakhs.
4. The consumer to whom the goods are sold or delivered can file a complaint.
5. The District Forum has to refer the complaint to the opposite party concerned, and send the sample of goods for testing in a laboratory.

State Commission:

1. This is established by the State Government in the state. The salient features of State Commission are as under:
2. It shall consist of a President who either is or has been a Judge of a High Court and two other Members. All the three shall be appointed by State Government.
3. Only those complaints can be filed where the value of goods or services and compensation claimed is between rupees twenty lakhs and rupees one crore.

Also, appeals against the orders of any District Forum can be filed before the State Commission.

National Commission:

1. This is established by the Central Government. The salient features of the Commission are as under:
2. It shall consist of a President who either is or has been a Judge of a Supreme Court and four other members. All shall be appointed by the Central Government.
3. All complaints pertaining to those goods or services and compensation whose value is more than rupees one crore can be filed. Also, appeals against the order of any State Commission can be filed before the National Commission.

The relief available to the consumers is in the form of directions which can be issued by the Consumer Court, against the seller/manufacturer:

1. To remove the defects in goods or deficiency in service.
2. To replace the defective product with a new one.
3. To refund the price paid for the product or charges paid to the service.
4. To pay a reasonable amount of compensation for any loss or injury suffered by the consumer due to the negligence of the opposite party.
5. To discontinue the unfair/ restrictive trade practice and not to repeat it in future.
6. To withdraw the hazardous goods for sale.
7. To cease manufacture of hazardous goods and to desist from offering hazardous services.
8. To issue corrective advertisement to neutralize the effect of a misleading advertisement.

NCERT Solutions for Class 12 Business Studies Chapter 12 Consumer Protection Case Study

Now, filing complaint is just a click away. Filing a complaint in a consumer court’s going to get a lot easier by the end of this year, virtually. No matter which part of the country you’re in, it’s going to happen at the click of a mouse. The project, called Confonet (Computerisation and Computer Networking of Consumer Fora), is being executed on a turnkey basis by the National Informatics Centre (NIC). ”Online registration of complaints, the government hopes, will promote e-governance, transparency, efficiency and streamlining of consumer fora,” said an official in the consumer affairs ministry. Of Rs 48.64 crore set aside for the project, the government has released Rs 30.56 crore so far, the official added. ”Besides software development and testing, networking and project implementation, integration and site preparation, it will include purchase of hardware for all the 583 district fora, 35 state commissions and the National Commission,” the official said. At present, computer systems and system software have been delivered to 25 state commissions and 300 district fora — never mind the fact that it’s sometimes a long wait before the hardware is finally unpacked and set up in some of the districts. Meanwhile, training of staff, sometimes in the classroom and sometimes through e-learning sessions, are in full swing. ”But just setting up an online complaint filing system won’t ensure a strong consumer protection movement in the country — for that we’re working on GenNext and the best way to do that is to go to schools,” the official said. The government is, therefore, involving school children to form consumer clubs so as to involve them in various consumer welfare activities. Part of the funding for running the club is to come from various state governments, with an equally matching grant from the Centre. However, a number of state governments are yet to sanction the fund — some of these include Uttar Pradesh, Madhya Pradesh and Kerala.

Question. What new measure is the ministry of consumer affairs taking to make filing of complaint easy?
Answer: New measure taken by ministry of consumer affairs is the introduction of process of online registration of complaints.

Question. What role can you as a student play to contribute to the cause of consumer protection?
Answer: As a student following can be done to contribute to the cause of consumer protection:

• Associate with a consumer organization in the near locality.

• Organise workshops for educating consumers in the school and people in nearby locality.

• Check quality of goods supplied within the school campus.

Question. What scenario of consumer protection do you foresee when the measures proposed in the above news report are implemented?
Answer: Online registration for complaints is a easy way to file complaints. But all consumers are not literate to use computers, focus should also be on the forums at different levels to ensure that all the consumers can file complaints or seek redressal.

NCERT Solutions for Class 12 Business Studies Chapter 12 Consumer Protection Objective Type Questions

Question. Caveat venditor means :
(a) Let the seller beware
(b) Let the buyer beware
(c) Both (a) and (b)
(d) None of these 
Answer: A

Question. The scope of Consumer Protection Act is applicable to :
(a) private or public sector
(b) the co-operative sector
(c) manufacturer or a trader
(d) all of the above 
Answer: D

Question. Which of the following consumer right states that a consumer has a right to be protected against goods and services which are hazardous to life and health
(a) Right to be Informed
(b) Right to seek Redressal
(c) Right to Safety
(d) Right to Consumer Education 
Answer: C

Question. Consumer Protection Council is in
(a) Ahmedabad
(b) Mumbai
(c) Delhi
(d) Gujarat 
Answer: A

Question. Which of the following is a consumer organisations and NGOs engaged in protecting and promoting consumers’ interests
(a) Consumer exploitation Council
(b) Karnataka Consumer Service Society
(c) Consumer Provider Council
(d) Mumbai court Panchayat
Answer: B

Question. Which of the following is the function of Consumer organisations and NGOs
(a) Educating the general public about consumer rights
(b) Publishing periodicals and other publications to impart knowledge about consumer problems
(c) Filing complaints in appropriate consumer courts
(d) All of the above 
Answer: D

Question. 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
(a) exceeds ₹ 20 lakhs but does not exceed ₹ 50 lakhs
(b) exceeds ₹ 10 lakhs but does not exceed ₹ 20 lakhs.
(c) exceeds ₹ 20 lakhs but does not exceed ₹ 1 crore.
(d) exceeds ₹ 50 lakhs but does not exceed ₹ 1 crore. R
Answer: C

NCERT Solutions for Class 12 Business Studies Chapter 12 Consumer Protection One Word Answer Type Questions

Question. Name any one Non-Governmental Organisations (NGOs) which are working in India to protect and promote the consumer interests. 
Answer: Consumer Guidance Society of India, Mumbai.

Question. Identify the right of a consumer under Consumer Protection Act, 1986 by which consumer organisations help a consumer to claim by performing the function of “encouraging consumers to strongly protest and take an action against unscrupulous, exploitative and unfair trade practices of sellers”. 
Answer: Right to be heard.

Question. Manvendra always went to a specific shop to buy all consumable and non-consumable goods. In this shop, variety of products of different brands were displayed nicely and the sales person available also gave good sales presentation if required. But this shop was quite far off from his residence. His friend Annant always wondered why Manvendra waste so much time in going to that shop whereas there were many big brand shops situated near his residence having consumable and non-consumable goods. Annant asked Manvendra the reason of going to that particular shop. Manvendra told that he was exercising one of his ‘Rights’ which he could not exercise in nearby big brand shops. State the consumer’s right which Manvendra had exercised.
Answer: Right to choose.

Question. Ronit Raj, a marketing manager is a patient of diabetes for which he takes medicines regularly. One day, on his tour to Patna, he met with an accident and was hospitalised. Due to doctors’ negligence a delicate nerve of his right leg was cut rendering him crippled throughout his life. Identify the consumer right that has been violated by the doctors under the Consumer Protection Act, 1986 in the above situation.
Answer: Right to safety.

Question. Manuj bought a packet of chips from a local shopkeeper and found that the ingredients given on the label were not legible. He complained about it to the company. The company sent a written apology stating that they will make sure that existing packets are withdrawn from the market and new packets with legible labels will be soon made available. State the consumer right which Manuj exercised.
Answer: Right to be informed.

Question. On the eve of Diwali, Ravi purchased two kilogram of sweets from Nandan Sweets. On consumption of sweets, his wife fell sick and was to be hospitalised. Ravi wanted to file a case in the consumer forum but could not do so because he did not have any proof of buying the sweets from Nandan sweets. Name the document that Ravi could have obtained for filing the complaint in the consumer forum.
OR
On the eve of Diwali, Kalpana purchased two kilogram of sweets from Koyal Sweets. On consumption of sweets, her two children and husband fell sick and were to be hospitalised. Kalpana wanted to file a case in the consumer forum but could not do so because she did not have any proof of buying sweets from Koyal sweets. What proof could Kalpana have obtained for filing the claim in the consumer court? 
Answer: Cash Memo.

Question. On Sonika’s birthday her mother gave her a pair of gold earrings. After one month, Sonika observed that the earrings are losing their shine. She checked the mark on the earrings and found that it was not a proper Hallmark and her mother had been cheated by the shopkeeper. So, she filed a complaint in the District Forum which rejected it. Not satisfied by the decision of District Forum, she was very much disturbed and after two months decided to appeal further. Can Sonika appeal against the decision of the district forum?
Answer: No, as the appeal has to be filed within 30 days of passing of the order by the district forum.

Question. Himanshu purchased a new car from ‘Galaxy Motors’ for ₹ 25 lakh. He was offered free insurance for the first year and three free servicing to be availed after the car had covered 5,000 km, 10,000 km and 15,000 km respectively. When Himanshu took the car for the first free servicing, he was told that the car was not new and first service had already been availed on this car. He felt cheated and filed a complaint in the State Commission. Being not satisfied with the decision of the State Commission, after two months he decided to file an appeal against it. Can Himanshu appeal against the decision of the State Commission ? 
Answer: No, as the appeal has to be filed within 30 days of passing of the order by the state commission.

Question. Himesh, after completing his graduation, started working with a multinational company in Delhi. But due to ill health of his parents, he had to go back to his village. There he noticed that the villagers were literate but ignorant about their rights. Many vegetable vendors were using stones as weights to sell their vegetables. Some shopkeepers were selling food items without having ‘FPO mark’. Villagers did not find anything wrong with these practices. So, to create awareness among villagers Himesh decided to publish a weekly Journal ‘Jan Jagriti’. State the ‘Right’ which Himesh has exercised by doing so.
Answer: Right to Consumer Education.

Question. On which type of products is ISI mark used?
Answer: Electrical goods. 

Question. ‘The consumer has the right to acquire knowledge and to be a well-informed consumer throughout life.’ State what type of knowledge is required by the consumer in the above stated ‘Right’. 
Answer: Right to Consumer Education.

Question. Pragya bought an iron of reputed brand for ₹ 1500 but it caused an electric shock while it was being used. Pragya wants to exercise her ‘Right’. Identify the right under which she can be protected.
Answer: Right to Safety.

Question. Under three tier machinery where can a legal heir or representative of a deceased consumer file a complaint when the compensation claimed is ₹ 25 lakh. 
Answer: State Commission.

Question. Your mother purchased a washing machine for ₹ 10,000 from an authorised dealer of the manufacturer with an oral guarantee that the machine will be replaced with a new one if any of its parts becomes defective within 3 months from the date of purchase. The motor of the machine was burnt within 15 days of its purchase. On complaining, the seller refused to replace the machine. Name the redressal agency under Consumer Protection Act where your mother can file the complaint.
Answer: District Forum.

NCERT Solutions for Class 12 Business Studies Chapter 12 Consumer Protection Short Answer Type Questions

Question. State any three functions performed by non-governmental organisations for consumer protection. 
Answer: Functions performed by non-governmental organisations for consumer protection are :
(i) Educating the general public about consumer rights.
(ii) Publishing periodicals and other publications.
(iii) Carrying out comparative testing of consumer products.
(iv) Encouraging consumers to strongly protest and take action against unscrupulous, exploitative and unfair trade practices of sellers.
(v) Providing legal assistance to consumers.
(vi) Filing complaints in appropriate consumer courts on behalf of the consumers.
(vii) Taking initiative in filing cases in consumer courts in the interest of the general public.

Question. State any eight reliefs available to a consumer under the provisions of Consumer Protection Act, 1986.
Answer: Reliefs available to a consumer under the provisions of Consumer Protection Act, 1986 :
(i) To remove the defect in goods or the deficiency in service.
(ii) To replace the defective product with a new one, free from any defect.
(iii) To refund the price paid for the product.
(iv) To pay a reasonable amount of compensation for any loss or injury suffered by the consumer due to negligence of the opposite party.
(v) To pay punitive damages in appropriate circumstances.
(vi) To discontinue the unfair/restrictive trade practice and not to repeat the same in future.
(vii) Not to offer hazardous goods for sale.
(viii) To withdraw hazardous goods from sale.
(ix) To cease manufacturing of hazardous goods.
(x) To pay any amount (not less than 5% of the value of the defective goods to be credited to the Consumer Welfare Fund or any other organisation/person, to be utilised in the prescribed manner)
(xi) To issue corrective advertisement to neutralise the effect of misleading advertisement.

Question. Explain briefly any two points of importance of consumer protection from the point of view of business. 
Answer: Two points of importance of consumer protection from the point of view of business.
(i) Long term interest of the business : In the competitive environment, the businessman can win and capture a big share in the market only through consumer satisfaction. Those who ignore the interest and satisfaction of consumers may loose their goodwill and clients.
(ii) Social Responsibility : Just like other stakeholders, towards consumers also, businessmen has got social responsibility to provide quality goods at reasonable price. Consumer protection guides businessmen to fulfil social responsibility towards consumers.
(iii) Government Intervention : If businessmen want to avoid intervention of Government then they should not involve in unfair trade practices and exploitative practices towards consumers.

Question. What is meant by ‘Consumer Protection’ ? Also state how consumer protection is important from the point of view of consumers.
OR
Explain the concept of consumer protection and explain any three points of its importance from the point of view of consumers.
Answer: Consumer protection means protecting the consumers from unscrupulous, exploitative and unfair trade practices of a seller or a producer for maximising their profits. Consumer protection not only includes educating the consumers about their rights and responsibilities but also helps in getting their grievances redressed. The importance of consumer protection from consumer’s point of view can be understood from the following points :
(i) Consumer’s Ignorance : In the light of widespread ignorance of consumers about their rights and reliefs available to them, it becomes necessary to educate them about the same so as to achieve consumer awareness.
(ii) Unorganised Consumers : In India, consumers are not organised. Though we do have consumer organisation working in this direction, adequate consumer protection is required to provide power and rights to these organisations to protect and promote the interests of consumers.
(iii) Widespread Exploitation of the Consumers: Unaware, ignorant consumers might be exploited by unscrupulous, exploitative and unfair trade practices like defective goods, adulteration, false and misleading advertising etc. Consumer protection provides safeguard to the consumers from such exploitation.

Question. State any three functions performed by consumer organisations for protection and promotion of interests of the consumer.
Answer: Three functions performed by the consumer organisations for the protection and the promotion of the interest of consumers are explained below :
(i) Promoting general awareness of the rights and responsibilities of the consumer by educating him and supplying relevant information.
(ii) Organising a data-base enabling the consumer to retrieve the required information in a less expensive and quick way.
(iii) Publishing general periodicals and product specific booklets pamphlets, and using other tools of mass communication for promoting consumer awareness.

Question. Aarushi buys a packet of dry cake from a cake shop without asking for the bill. The pack does not bear any information other than the name of shop. After reaching home she finds the cake to be stale.
(i) Identify the consumer right that has been violated.
(ii) State any three responsibilities that a consumer must keep in mind while purchasing any good.
Answer:
(i) Right to Information
(ii) Consumer Responsibilities
(a) Be aware about various goods and services available in the market so that an intelligent and wise choice can be made.
(b) Buy only standardised goods as they provide quality assurance. Thus, look for ISI mark on electrical goods, FPO mark on food products, Hallmark on jewellery etc.
(c) Learn about the risks associated with products and services, follow manufacturer’s instructions and use the products safely.
(d) Read labels carefully so as to have information about prices, net weight, manufacturing and expiry dates, etc.
(e) Assert yourself to ensure that you get a fair deal.
(f) Be honest in your dealings. Choose only from legal goods and services and discourage unscrupulous practices like black-marketing, hoar ding etc.
(g) Ask for a cash memo on purchase of goods or services. This would serve as a proof of the purchase made.

Question. State any three directions which can be issued by the consumer court to the opposite party if it is satisfied about the genuineness of the complaint.
Answer: If the Consumer Court is satisfied with the genuineness of the complaint, it can issue one or more of the following directions to the aggrieved party as reliefs :
(i) To remove the defect in goods or the deficiency in service.
(ii) To replace the defective product with a new one, free from any defect.
(iii) To refund the price paid for the product.
(iv) To pay a reasonable amount of compensation for any loss or injury suffered by the consumer due to negligence of the opposite party. (v) To pay punitive damages in appropriate circumstances.
(vi) To discontinue the unfair/ restrictive trade practice and not to repeat the same in future.
(vii) Not to offer hazardous goods for sale.
(viii) To withdraw hazardous goods from sale.
(ix) To cease manufacture of hazardous goods.
(x) To pay any amount (not less than 5% of the value of the defective goods to be credited to the Consumer Welfare Fund or any other organisation/person, to be utilised in the prescribed manner.
(xi) To issue corrective advertisement to neutralise the effect of misleading advertisement.
(xii) To pay adequate costs to the appropriate party.

Question. Bye-Bye Motors recently informed the media about its aim to train up to 4000 people in the next 3 years in the skills associated with automobile industry as part of its program to provide technical and vocational education for unemployed youth. The firm has already started the programme in collaboration with Automobile Skill Development Council. This news in the media has helped the firm in promoting its image in the eyes of the public and consumer activist groups.
(i) Why is it important for the company to satisfy the public and the consumer activist groups? Give reasons.
(ii) Which departments in the firm can be given the responsibility to disseminate information and build goodwill of the firm?
Answer:
(i) (a) The voice and opinion of the general public is important as they may be interested in the company and its product and have an impact on the business ability to achieve its objectives. Thus, it is imperative to manage public opinion and the company’s relation with the public on a regular basis.
(b) Consumer Activist groups need to be satisfied because they can impose restriction on the sales of the firm’s products directly by urging customers to refrain from buying them through the imposition of laws.
(ii) The following departments in the firm can be given the task to disseminate information and build goodwill :
(a) The marketing department.
(b) A separate department to manage public relations.

Question. Explain the following Rights of Consumers :
(i) Right to be Informed (ii) Right to Safety.
Answer: (i) Right to Safety :
(a) Right to be protected against goods and services which are hazardous to life and health.
(b) Right to get protection against the risks caused due to the use of substandard products or products that do not confirm to the safety norms.
(ii) Right to Choose :
(a) The consumer has the freedom to choose from a variety of products at competitive prices.
(b) Marketers should offer a wide variety of product in terms of quality, price, size etc. to enable the consumer to make the choice.
(iii) Right to be Heard :
(a) The consumer has right to file a complaint and to be heard in case of dissatisfaction with a product or a service.
(b) It is because of this reason many firms have set up their own consumer service and grievance cells.
(iv) Right to Seek Redressal :
(a) The consumer has a right to get relief in case the product or service falls short of his expectations.
(b) The Consumer Protection Act provides relief to customers such as replacement of product, removal of defect in the product, compensation for any loss or injury suffered by the consumer.
(v) Right to be Informed :
(a) The consumer has a right to have complete information about the product he intends to buy such as ingredients, date of manufacturing, price, quantity, etc.
(b) It is because of this reason that the legal framework in India requires the manufacturers to provide such information on the package and label of the product.
(vi) Right to Consumer Education :
(a) The consumer has the right to acquire knowledge and to be a well-informed consumer.
(b) He should be aware about his rights and the reliefs available to him in case of a product or service falling short of his expectations.

Question. How are consumer grievances redressed by the three-tier machinery under Consumer Protection Act, 1986 ? Explain.
Answer: Redressal of consumer grievances under Consumer Protection Act, 1986 is done under the three tier machinery comprising of :
(i) District Forum :
(a) A complaint can be made to the appropriate District Forum when the value of goods or services in question along with the compensation claimed does not exceed ₹ 20 lakh.
(b) The appeal against the orders of the District Forum can also be filed before the State Commission.
(ii) State Commission :
(a) A complaint can be made to the appropriate State Commission when the value of goods or services in question along with the compensation claimed exceeds ₹20 lakh but does not exceed ₹ 1 crore.
(b) The appeal against the orders of the State Commission can also be filed before the National Commission.
(iii) National Commission :
(a) A complaint can be made to the appropriate National Commission when the value of goods or services in question along with the compensation claimed exceeds ₹1 crore.
(b) An order passed by the National Commission in a matter of its original jurisdiction is appealable before the Supreme Court.

Question. Palak went to a shopkeeper to buy a hair oil. The shopkeeper forced her to buy a particular brand of hair oil among various available brands, irrespective of the willingness of Palak. Which ‘Right’ of Palak, as a consumer has been violated? Name and explain the ‘Right‘. 
Answer: The right violated here is ‘Right to Choose’. Right to Choose : The consumer has the freedom to choose from a variety of products at a competitive prices. This implies that the marketers should offer a wide variety of product in terms of quality, brand, prices, size etc. and allow the consumer to buy a product on his free will. The seller should not use aggressive selling techniques to sell the product to the consumer.

Question. Harsh asked for a bottle of mineral water from a shopkeeper. The maximum retail price printed on the bottle was ₹ 12, whereas the shopkeeper was charging ₹ 35. Inspite of many arguments the shopkeeper was not ready to sell the bottle for less than ₹ 35. Harsh was in need of it and had no option except to buy. As an aware consumer name and explain the ‘Right‘ which Harsh can exercise.
Answer: The consumer right affected here is Right to be Heard. Every Consumer has the right that his complaint be heard under the ‘Right to be Heard’. A consumer can file a complaint against all those things which are prejudicial to his interests. These days several organisation have set up their consumer service cells with a view to provide the ‘right to be heard’ of the consumer. The cell will hear such complaints of the customers and take adequate measures to address them. 

Question. Give the definition of ‘Consumer’ as per Consumer Protection Act, 1986.
OR
What is meant by 'Consumer' as per the provisions of Consumer Protection Act, 1986. 
Answer: Under the Consumer Protection Act, a consumer is defined as :
(i) Any person who buys any goods for a consi-deration, which has been paid or promised, or partly paid and partly promised, or under any scheme of deferred payment. It includes any user of such goods, when such use is made with the approval of the buyer, but does not include a person who obtains goods for resale or any other commercial purpose.
(ii) Any person who hires or avails of any service, for a consideration which has been paid or promised, or partly paid and partly promised, or under any system of deferred payment. It includes any beneficiary of services when such services are availed of with the approval of the person concerned, but does not include a person who avails of such services for any commercial purpose.

Question. State any three responsibilities that a consumer must keep in mind while purchasing gold jewellery.
Answer: Following are the consumer responsibilities that a consumer must keep in mind while purchasing gold jewellery :
(i) Be aware about various goods (types of jewellery) available in the market so that an intelligent and wise choice can be made.
(ii) Buy only standardised jewellery as they provide quality assurance. Thus, look for Hallmark on jewellery.
(iii) Learn about risks associated with the product, follow manufacturer’s instructions.
(iv) Read labels carefully so as to have information about prices, net weight, etc.
(v) Assert yourself to ensure a fair deal.
(vi) Be honest in your dealings.
(vii) Ask for a cash memo on purchase of the jewellery.

Question. Explain any four points of importance of ‘Consumer Protection’ from the point of view of business.
Answer: Importance of ‘Consumer Protection’ from the point of view of business :
(i) Long-term interest of business : Long-term interest of a business lies in the satisfaction of its customers that leads to repeat sales and attracts other customers.
(ii) Business uses society’s resources : As a business uses social resources, it is bound to serve the society by using its resources through adoption of fair trade practices which ensures consumer protection.
(iii) Social responsibility : Since consumers are a part of society, consumer protection is the part of its social responsibility to fulfil its social objective.
(iv) Moral justification : Business ethics advocates adoption of moral principles in conducting business affairs. Then a business is required to adopt consumer protection as its moral duty.
(v) Government Intervention : To avoid government intervention in the business activities due to malpractices, a business should take government intervention as the first priority of protection.

NCERT Solutions for Class 12 Business Studies Chapter 12 Consumer Protection Long Answer Type Questions

Question. Aditi set-up a company ‘Dantik Ltd.’to manufacturer toothpastes using herbs found in her village instead of chemicals that are hazardous to health. The package of the product was eco-friendly and had details like price, quantity, ingredients, directions for use and other relevant information. It also carries the contact details like address, phone number and e-mail id of ‘Dantik Consumer Services and Grievance Cell’. The toothpaste became very popular and she started getting orders from reputed traders. Identify and explain any two Rights of Consumers discussed above. 
Answer:
(a) Rights of Consumers discussed above :
(i) Right to be Informed states that a consumer has a right to have complete information about the product he intends to buy such as ingredients, date of manufacture, price, quantity etc.
(ii) Right to be Heard states that a consumer has right to file a complaint and to be heard in case of dissatisfaction with a product or a service.

Question. Aman, a degree holder in Entrepreneurship came, know about Piplantri Village located in Rajasthan, where in 2006 an initiative was started, in which 111 trees are planted every time a girl child is born. To keep termites away from the trees the villagers have planted 2.5 million Aloe Vera plants around the trees. This has turned the village into an oasis, as the planting of trees led to higher water levels. Aman decided to visit the village to start a business unit, for the processing and marketing of Aloe Vera into juices, gels and other products. However, on visiting the village Aman found that the villagers were suffering exploitation at the hands of local merchants who were engaged in unscrupulous, exploitative trade practices like hoarding and black marketing of food products and also selling unsafe, adulterated products to the villagers. After looking at their plight instead of a business organisation he decided to set up an organisation
for the protection and promotion of the consumer interest of the villagers. State the functions that the organisation established by Aman will be performing. (Any six points) 
Answer: Functions of an NGO/Consumer organisation:
(i) Educating the villagers/general public about the consumer rights by organising training, programmes, seminars and workshops.
(ii) Publishing periodicals and other publications to impart knowledge about consumer problems, reliefs available and other matters of interest.
(iii) Carrying out comparative testing of the consumer products in accredited laboratories to test relative qualities of competing brands and publishing the test results for the benefit of the consumers.
(iv) Encouraging consumers to strongly protest and take an action against exploitative and unfair trade practices of sellers.
(v) Providing legal assistance to the consumers by way of providing aid, legal advice etc, in seeking the legal remedy.
(vi) Filing complaints in the consumer courts on behalf of the consumers.
(vii) Taking an initiative in filing cases in the consumer courts in the interest of the villagers/general public, not for any individual.

Question. State any two reliefs that the Consumer court can grant to consumers in case of genuine complaints in each of the following situations :
(i) Divya was charged more than the printed maximum retail price (MRP) for a bottle of water.
(ii) Clara was sold a car with a defective engine.
(iii) Antony suffered injury while using newly bought defective electric heater.
OR
Explain any two reliefs that the Consumer Court can grant to consumers in case of genuine complaints in each of the following situation.
(i) Komal was charged more than the printed price for a NCERT business studies book being in short supply.
(ii) Kumar was sold a truck with a defective engine.
(iii) Suresh suffered injury while using a newly bought defective electric iron. 
Answer:
(i) Reliefs that the Consumer court can grant to the customers are :
(a) To refund the price paid.
(b) To pay punitive damages.
(c) To discontinue the unfair/ restrictive trade practice and not to repeat the same in future.
(d) To pay any amount (not less than 5% of the value of the bottle of water) to be credited to the Consumer Welfare Fund or any other organisation/person, to be utilised in the prescribed manner.
(e) To pay adequate costs to the appropriate party. 
(ii) Reliefs that the Consumer court can grant to the customers are :
(a) To remove the defect in engine.
(b) To replace the defective engine with a new one, free from any defect.
(c) To refund the price paid.
(d) To pay punitive damages.
(e) To pay any amount (not less than 5% of the value of the defective engine) to be credited to the Consumer Welfare Fund or any other organisation/person, to be utilised in the prescribed manner.
(f) To pay adequate costs to the appropriate party. 
(iii) Reliefs that the Consumer court can grant to the customers are :
(a) To remove the defect in electrical heater.
(b) To replace the defective electrical heater with a new one, free from any defect.
(c) To refund the price paid.
(d) To pay a reasonable amount of compensation for any loss or injury suffered by the consumer due to negligence of the opposite party.
(e) To pay punitive damages.
(f) To discontinue the unfair/ restrictive trade practice and not to repeat the same in future.
(g) Not to offer hazardous goods like defective electrical heater for sale.
(h) To withdraw hazardous goods like defective electrical heater from sale.
(i) To cease manufacture of hazardous goods like defective electrical heater.
(j) To pay any amount (not less than 5% of the value of the defective goods) to be credited to the Consumer Welfare Fund or any other organisation/person, to be utilised in the prescribed manner.
(k) To pay adequate costs to the appropriate party.

Question. Non-Government Organisations perform several functions for the protection and promotion of interests of consumers. State any six functions performed by them. 
Answer: Functions of Non-Government Organisation :
(i) Education and Training : Organising training programmes, seminars and workshops to educate the general public about consumer rights.
(ii) Publishing Periodicals : Publishing periodicals and other publications to impart knowledge about the consumer problems, legal reporting, reliefs available and other matters of interest.
(iii) Conducting Comparative Testing : Carrying out comparative testing of consumer products in credited laboratories to test relative qualities of competing brands and publishing the test results for the benefits of consumers.
(iv) Encouragement to Consumers : Encouraging the consumers to strongly protest and take actions against unscrupulous, exploitative and unfair trade practices of sellers.
(v) Legal Assistance : Providing legal assistance to the consumers by way of providing aid, legal advice, etc. in seeking a legal remedy.
(vi) Filing Complaints : Filing complaints with appropriate consumer courts on behalf of the consumers.

Question. Explain the three tier machinery under ‘The Consumer Protection Act’ for redressal of consumers’ grievances.
Answer: The three tier machinery under the Consumer Protection Act for redressal of consumers grievances consists of :
(i) District Forum : The District Forum consists of a President and two other members, one of whom should be a woman. They all are appointed by the State Government concerned. A complaint can be made to the appropriate District Forum when the value of the goods or services in question, along with the compensation claimed, does not exceed ₹ 20 lakhs. On receiving the complaint, the District Forum shall refer the complaint to the party against whom the complaint is filed. If required, the goods or a sample thereof, shall be sent for testing in a laboratory. The District Forum shall pass an order after considering the test report from the laboratory and hearing to the party against whom the complaint is filed. In case the aggrieved party is not satisfied with the order of the District Forum, he can appeal before the State Commission within 30 days of the passing of the order.
(ii) State Commission : Each State Commission consists of a President and not less than two other members, one of whom should be a woman. They are appointed by the State Government concerned. A complaint can to 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 exceed ₹ 1 crore. The appeals against the orders of a District Forum can also be filed before the State Commission. On receiving the complaint, the State Commission shall refer the complaint to the party against whom the complaint is filed. If required, the goods or a sample
thereof, shall be sent for testing in a laboratory. The State Commission shall pass an order after considering the test report from the laboratory and hearing to the party against whom the complaint is filed. In case the aggrieved party is not satisfied with the order of the State Commission, he can appeal before the National Commission within 30 days of the passing of the order.
(iii) National Commission : The National Commission consists of a President and at least four other members, one of whom should be a woman. They are appointed by the Central Government. A complaint can to be made to the National Commission when the value of the goods or services in question, along with the compensation claimed, exceeds ₹ 1 crore. The appeals against the orders of a State Commission can also be filed before the National Commission. On receiving the complaint, the National Commission shall refer the complaint to the party against whom the complaint is filed. If required, the goods or a sample thereof, shall be sent for testing in a laboratory. The National Commission shall pass an order after considering the test report from the laboratory and hearing to the party against whom the complaint is filed.