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CBSE Guess > eBooks > Class XII > Business Studies by Dorothy Mathias

Chapter –12A Consumer Protection (2+4 = 6 Marks)

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2-3 marks Q should not exceed 30-40 words

4-5 marks Q should not exceed 60-80 words

6 marks Q should not exceed 100 words

Consumer Protection (2+4 = 6 marks)

(a) The rationale of consumer protection – concept, aspect and need

(b) Importance of Consumer Protection

(c) Consumer rights and responsibilities

(d) Ways and Means of Consumer Protection

(e) Role of Consumer Organizations

Explain briefly the meaning of “consumer” with reference to Consumer Protection Act 1986 - 2 marks

The Act defines consumer as:

  1. One who buys goods or hires services for consideration.
  2. One who uses the goods or hired services with the approval of the buyer or hirer of the service.
  3. One who uses the goods/services to earn livelihood by self-employment.

What are the salient features of Consumer Protection Act? – 4 marks

  • The Act applies to all goods and services unless specially exempted by Union Government
  • It covers all sectors – public, private or cooperative
  • Provisions of the Act are compensatory in nature
  • It enshrines all consumers rights - to choose, to be heard, to be informed, to safety, education and redressal (CHISER)
  • It empowers consumers seeking discontinuance of trader’s malpractices, defective goods, service deficiencies or withdrawal of hazardous goods from the market.

What does “Consumer Protection” refer to?

  • It refers to protection of consumers against anti consumer trade practices by producers/traders.
  • These anti trade include adulteration, sub standard quality, overcharging, making misleading claims in advertisements, etc
  • The essence of consumer protection is curbing such practices through legislative and other measures

Giving any six points, explain the need/importance for consumer protection? OR Why is consumer protection needed in India – 6 marks

Business is a means of human welfare:

Business serves the customer and therefore it is a means and not an end in itself. Hence it is in the interest of both the consumer and the businessman to ensure that the business is run well because ignoring the interest of the consumer may be a sure death of the business.

Growth with social justice:

We are a secular country and growth with social justice is the cornerstone of our economic philosophy. Exploitation of consumers is against the directive principles of State Policy laid down in our Indian Constitution.

Single versus multiple objectives:

Business works for all stakeholders – consumers, shareholders, employees, government, and the public. It is both a social and economic institution. Therefore it cannot just make profit by ignoring the interest of the society. For the survival and growth of business it must work for the interest of the stakeholders in general and consumers in particular.

Power Centre:

Business has considerable influence over society and government. Therefore it has to set standards regarding food, dress habits, living styles, etc which will not damage the cause of society and serve the interest of a few persons only.

Self interest:

  • Due to liberalization and globalization, firms have to compete with multinationals. Unless they become customer oriented and provide right quality, quantity and price they cannot satisfy a customer and without customer satisfaction no business can survive for long and will be out beaten by competition from multinationals.
  • Moreover, Government has enacted laws to protect the interest of the consumers. Hence if a firm violates the laws they are likely to lose their goodwill and clients permanently.

Ethical obligations:

Firms that adapt ethical values, attain glories in the business world. Business without ethical values is nothing but a criminal activity and no civil society will tolerate a business without ethical values for long.

(½ mark for naming each point and ½ mark for each explanation)

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