Definition of consumer, goods and services

Theoretical overview

A consumer is a buyer of goods or services.

A consumer is a person or a group who intends to order, orders, or uses purchased goods, products, or services primarily for personal, social, family, household and similar needs, not directly related to entrepreneurial or business activities. Section 2(d) of the Consumer Protection Act says that consumer means any person who: –

1. buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment, and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
2. hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment, and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person.

Consumer protection act

The Consumer Protection Act, implemented in 1986, gives easy and fast compensation to consumer grievances. It safeguards and encourages consumers to speak against insufficiency and flaws in goods and services.

Consumer goods;  Consumer goods are goods sold to consumers for use at home or school, or for entertainment or personal use. There are three main types of consumer goods: – durables, non-durables, and services. 

Customer Service is the interaction between the buyer of a product and the company that sells it. Consumer Services are the intangible economic product that is provided by a person on the other person’s demand.

The Consumer Protection Act, 1986 has been repealed after three decades and replaced by the Consumer Protection Act, 2019. The Consumer Protection Act, 2019 has been enacted with a view to broaden the scope of consumer rights and directly cover the area of ​​e-commerce. Sales, tele-shopping and other multilevel marketing in the age of digitization. This act came into force on 20 July 2020. The objective of this act is to improve the disposal and administration process by imposing harsher penalties.

As per Section 2(7) of the Consumer Protection Bill, 2019, a consumer is any person who purchases goods or avails of any service and includes any user other than a person who has purchased such services or goods for the purpose of resale or commercial use.

 Unfair Trade Practice under Consumer Protection Act 2019 means the use of various deceptive, fraudulent, or unethical methods to obtain business. Unfair business practices include misrepresentation, false advertising or representation of a good or service, tied selling, false free prize or gift offers, deceptive pricing, and noncompliance with manufacturing standards.

Difference b/w goods and services

1. Goods are the material items that the customers are ready to purchase for a price. Services are the amenities, benefits or facilities provided by the other persons.
2. Goods are tangible items i.e. they can be seen or touched whereas services are intangible items.
3. When the buyer purchases the goods by paying the consideration, the ownership of goods moves from the seller to the buyer. Conversely, the ownership of services is non-transferable.
4. The evaluation of services is difficult because every service provider has a different approach of carrying out services, so it is hard to judge whose services are better than the other as compared to goods;
5. Goods can be returned to or exchanged with the seller, but it is not possible to return or exchange services, once they are provided.
6. Goods can be distinguished from the seller. On the other hand, services and service provider are inseparable.

Points to remember

• A consumer is a person or a group who intends to order, orders, or uses purchased goods, products, or services primarily for personal, social, family, household and similar needs, not directly related to entrepreneurial or business activities. 
• The Consumer Protection Act, implemented in 1986, gives easy and fast compensation to consumer grievances
• Consumer Services are the intangible economic product that is provided by a person on the other person’s demand
• Consumer goods are goods sold to consumers for use at home or school, or for entertainment or personal use