Sometimes free goods and services are not a good thing

Dr SD Israni

The year 1986 was a landmark in the history of consumer rights in India when the Consumer Protection Act (CPA) became a statute. In fact, laws like Sale of Goods Act, Contract Act, and such, were already on the statute book, but there wasn’t any special law like CPA to provide quick, cheap and effective remedy nor a specialised forum to redress the grievances of dissatisfied consumers. CPA came on the scene to address both the issues.

According to CPA, a ‘consumer’ means any person who buys goods or services for a consideration. Whether it is cash, credit or part cash and part credit is not material. What is important is that the consumer has either paid the price or agreed to pay the price at a later date.

It should be noted that a person who obtains such goods for resale or for a commercial purpose is not treated as a consumer under CPA. In other words, only a person buying goods for personal use and not for resale can seek remedy under CPA in case of defective goods. The same applies to services as well.

However, as far as use of goods or services for commercial purpose is concerned, there is an exception to the rule provided in the definition of the term ‘consumer’. Accordingly, CPA provides protection to a person who purchases goods and uses them (or avails of services) exclusively for the purposes of earning his livelihood by means of self-employment.

Many of us have a tendency to fall for stuff that is free. It is a different matter that, in most of the cases, the so-called ‘free’ is camouflaged or tagged along with some other product/service or there are other extraneous reasons. There’s an old saying, “All that glitters is not gold.” With some modification, it may be said that all that is free is not necessarily a boon. What the definition of the term ‘consumer’ indicates is that if a product or service has been obtained for free, then even if the product or service is defective or extremely poor, no remedy will be available to the purchaser under CPA.
This lesson was learnt the hard way by Fakeer Chand, a resident of Mahasamund (Chhattisgarh). Mr Chand underwent a surgery on his right eye at an eye camp organised by a local association sometime in 2009. When the doctor removed the bandage after the operation, Mr Chand was unable to see clearly. He, therefore, went to a government hospital, where he found other patients also whose eyesight was affected after the surgery at the aforesaid eye camp.

The complainant was further treated at a district hospital. Since his eyesight did not improve, he was referred to Medical College and Hospital at Raipur and was recommended surgery and virectomy for retina detachment.

Being aggrieved by the treatment received, he filed a consumer complaint with the District Forum alleging medical negligence on the part of the concerned doctor who performed the eye surgery. He sought Rs2.80 lakh by way of compensation on various counts. His complaint was dismissed by the District Forum. Even his appeal against the order of the District Forum was turned down by the State Commission. He approached the National Commission against the order of the State Commission seeking compensation. The National Commission, after considering all the aspects, held that the complainant was unable to show any evidence of payment of fees/consideration for the eye surgery which he underwent at the aforesaid eye camp. The finding of the State Commission—that there was no relationship of a consumer and service provider between the complainant and the eye surgeon—was thus upheld.

So, the next time you are offered anything free, be it goods or services, do stop and ponder before jumping to take the offer, lest you meet the fate of Fakeer Chand.

SD Israni is a corporate lawyer and Fellow of ICSI. Email: [email protected]