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Unit 13: Consumer Protection Act

Restrictive Trade Practice means a trade practice which tends to bring about manipulation of Notes
price or its conditions of delivery or to affect flow of supplies in the market relating to goods or
services in such a manner as to impose on the consumers unjustified costs or restrictions and
shall include—

(a) delay beyond the period agreed to by a trader in supply of such goods or in providing the
services which has led or is likely to lead to rise in the price;
(b) any trade practice which requires a consumer to buy, hire or avail of any goods or, as the case
may be, services as condition precedent to buying, hiring or availing of other goods or services
[Section 2(1)(nn)].
Defect means any fault, imperfection or shortcoming in the quality, quantity, potency, purity or
standard which is required to be maintained by or under any law for the time being in force or
under any contract, express or implied, or as is claimed by the trader in any manner whatsoever
in relation to any goods [Section 2(1)(f)].
It is clear from the above definition that non-fulfilment of any of the standards or requirements
laid down under any law for the time being in force or as claimed by the trader in relation to any
goods fall under the ambit of defect. Therefore, contravention of any of the provisions of
enactments such as the Drugs & Cosmetics Act, 1950, Standards of Weights and Measures Act,
1976, the Prevention of Food Adulteration Act, 1955, the Indian Standards Institution
(Certification Marks) Act, 1952 etc. or any rules framed under any such enactment or contravention
of the conditions or implied warranties under the Sale of Goods Act, 1930 in relation to any
goods have also been treated as a defect under the Act. Fault, imperfection or shortcoming in
quality, quantity, potency, purity or standard as claimed by the trader in any manner whatsoever
in relation to goods is to be determined with reference to the warranties or guarantees expressly
given by a trader.
Deficiency means any fault, imperfection, shortcoming or inadequacy in the quality, nature and
manner of performance which is required to be maintained by or under any law for the time
being in force or has been undertaken to be performed by a person in pursuance of a contract or
otherwise in relation to any service [Section 2(1)(g)].
Failure to maintain the quality of performance required by the law or failure to provide services
as per warranties given, by the provider of the service would amount to deficiency.

Example: In Divisional Manager, LIC of India v. Bhavanam Srinivas Reddy, the National
Commission observed that default or negligence in regard to settlement of an insurance claim
(on allegation of suppression of material facts, in this particular case) would constitute a deficiency
in service on the part of the insurance company and it will be perfectly open for the aggrieved
consumer to approach the Redressal Forums to seek appropriate relief.

In Jaipur Metals and Electrical Ltd. v. Laxmi Industries, the National Commission held that a reading
of Section 2(1)(g) of the Act shows that deficiency must pertain to the performance in terms of
quality, nature and manner to be maintained or had been undertaken to be performed in
pursuance of a contract.
In Punjab National Bank v. K.B. Shetty (First Appeal No. 7 of 1991 decided on 6th August, 1991),
ornaments kept in the banks locker were found lost though the certificate recorded by the
custodian of the bank on the day the customer operated the locker stated that all lockers operated
during the day have been checked and found properly locked. The National Commission
unholding the decision of the State Commission, held the bank guilty of negligence and therefore,
liable to make good the loss.

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