P. R. RAMACHANDRA MENON v. Controller of Legal Metrology Department of Weights and Measures
2009-04-08
P.R.RAMACHANDRA MENON
body2009
DigiLaw.ai
Judgment: The Petitioner is challenging Ext. P2, P6 & P7 proceedings issued by the Respondents 1 & 2; whereby prosecution steps are caused to be instituted against the petitioner alleging the offence under Sec. 39(5) of the Standards of Weights & Measures Act 1976 (‘Act’ in short) and Rule 5 Schedule III Clause No. 17 (c) of the Standards of Weight & Measures (Packaged Commodities) Rules 1977 (‘Rules’ in short). 2. The Petitioner is engaged in the manufacture and marketing of various Consumer Products including ‘Pears Transparent Soap’. In furtherance to the steps for promoting the said Toilet Soap, the petitioner Company introduced a Scheme called ‘Super Saver Offer’ in a ‘Multi- Piece Package’ containing 3 pre-packed soaps of 75gms each, with a total net weight of 225gms, to be sold for a maximum retail price of Rs. 50/- instead of Rs. 58.50/- (inclusive of taxes); thus stating that there was a benefit of Rs. 8.50/- to the Consumer. It is said, that the above scheme was being pursued in strict compliance with the relevant provisions of the ‘Act and the Rules’ and that no contravention of any provisions of law was intended or pursued in any manner. 3. While so, the petitioner was served with Ext. P2 Show – cause notice stating that the petitioner had committed an offence under Sec. 39 (5) of the Act and Rule 5 of the Rules, read with Sec. 33 of the Standards of Weights and Measures (Enforcement) Act 1985. This was replied by the petitioner vide Ext. P3, explaining the facts and circumstances, also producing the requisite materials, asserting that the action pursued by the petitioner was strictly in compliance with the relevant provisions of the statute and that no offence was committed at any point of time as alleged; which was more so, when the concerned packet was a ‘multi – piece package’ containing all the endorsements and declaration as stipulated by the Rules including the ‘additional declaration’ under Rules 17. 4. On receipt of Ext.
4. On receipt of Ext. P4 Reply, the 2nd Respondent observed that the explanation was not satisfactory; that there was clear violation and hence that the petitioner was liable to be prosecuted; simultaneously observing that the ‘additional declaration’ made by the petitioner under Rules 17 of the Packaged Commodity Rules was not relevant, in so far as the petitioner was not charged by the said Respondent in respect of any offence under Rule 17. 5. Met with the above circumstances, the petitioner filed Ext. P5 Appeal before the 1st Respondent explaining the facts and figures in a meticulous manner and asserting that no offence was committed as alleged and thus seeking to drop all further proceedings. The Petitioner submits that the 1st Respondent, without considering the various contentions raised in Ext. P5 Appeal and without considering the relevant provisions of law, simply passed a cryptic order observing that the ‘net weight’ of the package being 225gms (75 gm x 3), it was not a standard pack as per the 3rd Schedule of the packaged Commodities Rules. It was further held that the package in question was not a ‘multi – piece package’ as the individual piece was not suitable for sale separately and in the said circumstance, the Appeal was held as not sustainable and was rejected as per Ext. P6 order, followed Ext. P7 sanction for prosecution; which hence have been subjected to challenge in the present Writ Petition. 6. The 2nd respondent has filed a Counter Affidavit (dtd 012.02) on behalf of 1st and 2nd respondent. Yet another Counter Affidavit has been filed by the 1st Respondent (dtd 18.08.03) reiterating almost similar contentions as raised by the 2nd respondent; the sum and substance of which are; (i) The package in question cannot be considered as a ‘multi – piece package’ as the individual unit contained therein is not capable of being sold separately. (ii) The net weight of the package being 225gms (containing 3 separate Units of 75gms each), it is a non-standard package and hence involves violation of Section 39(5) of the Act and Rules 5 of the Rules. 7.
(ii) The net weight of the package being 225gms (containing 3 separate Units of 75gms each), it is a non-standard package and hence involves violation of Section 39(5) of the Act and Rules 5 of the Rules. 7. To appreciate the factual position involved, it is very much necessary to have a look at Sec. 39(5) of the Act and Rule 5 of the Rule as extracted below;- Sec. 39 (5) “Where the Central Government has reason to believe that there is undue proliferation of weight, measure or number in which any commodity is, or reasonably comparable commodities are, being packaged for sale, distribution or delivery and such undue proliferation impairs in the opinion of that Governments, the reasonable ability of the consumer to make a comparative assessment of the prices after considering the net quantity or number of such commodity, that Government may direct the manufacturers and also packers or distributors to sell, distribute or deliver such commodity in such standard quantities or numbers as may be prescribed. Rule 5 “5. Specific commodities to be packed and sold only in standard packages:- On and from the commencement of these rules, no person shall pre-pack, or cause or permit to be pre-packed any commodity for sale, distribution, or delivery except in such standard quantities as are specified in relation to that commodity in the Third Schedule. Provided that the Central Government may, if it is satisfied that for any technical or mechanical reason it is not possible to pre-pack any commodity in the standard quantities specified in the Third Schedule, authorize the pre-packing of such commodities in such quantities as it, may specify.” The relevant entry pointed out by the Respondents is Clause 17 (c) of the 3rd Schedule mentioned under Rule 5, which is extracted below; 3rd SCHEDULE ……………….. 8. It is the consistent case of the petitioner, that in order to promote the marketing of its product – Pears Transparent Toilet Soap, the Company had introduced the Scheme called the ‘Super Saver Offer’ in a ‘multi- piece package’ containing 3 pre-packed soaps of 75gms each with a total net weight of 225gms and sold for a maximum retail price of Rs. 50/- instead of Rs. 58.50 (inclusive of taxes).
50/- instead of Rs. 58.50 (inclusive of taxes). It is submitted that since there is a benefit of Rs.8.50 to the Consumer and since all the relevant particulars as stipulated under the Act/Rules have been shown on the ‘multi-piece package’ as evident from Ext.P1, the alleged offence under Sec. 39 (5) is never attracted; particularly when Sec. 39(5) is intended to protect the consumer enabling him to make a comparative assessment of the prices after considering the net quantity or No. of such commodity to be shown in a standard from – which requirement has been complied with by the petitioner and the benefit of the consumer is clearly projected and highlighted. 9. Sri. A.M. Shafeque the learned Sr. Counsel for the petitioner submits that the idea and understanding of the Respondents 1 & 2 as to the scope, object and requirement of the relevant provisions of law are thoroughly wrong and misconceived. The learned Sr. Counsel further submits that the stand taken by the said Respondents that the package involved is not a ‘multi - piece package’ is per-se wrong and perverse in all respects, particularly in view of the definition of the term ‘multi – piece package’ as given under Rule 2 (j) of the Rules which is extracted below: Rule 2 (j) (j) “multi-piece package means a package containing two or more individually packaged or labeled pieces of the same commodities of identical quantity, intended for retail sale, either in individual pieces or the package as a whole.” Illustration:- A package containing “5 toilet soap cake, net weight 20g each of total net weight of 100g’ is multi-piece package:”. The definition clearly show that the instances of retail sale can either be as ‘individual unit’ or the ‘package as a whole’ and it does not stipulate that both the limbs should be satisfied simultaneously. In other words, the provision does not insist that only in a circumstance when the package in question will provide the retail sale, both as ‘individual unit’ and also as the ‘package as a whole’; that the package would come within the definition of ‘multi – piece package’.
In other words, the provision does not insist that only in a circumstance when the package in question will provide the retail sale, both as ‘individual unit’ and also as the ‘package as a whole’; that the package would come within the definition of ‘multi – piece package’. The observation made by the Respondents that the individual units contained in the package are not properly packaged or labeled enabling to be sold as individual units and hence that the package containing the 3 units cannot be considered as a ‘multi – piece package’ is totally alien to the scope and object of the statutory prescription. 10. Another important aspect to be noted is that the concept of ‘multi – piece package’ had never struck the mind of the 2nd Respondent when Ext. P2 show-cause notice was issued; for the obvious reason that the charge alleged was only that, it was a ‘non – standard’ quantity having the net weight of 225gms. The basis on which Ext. P2 show-cause notice was issued, as contained therein, is extracted below for convenience of reference: “Your action of manufacturing and packing a commodity specified under 3rd schedule, constituted under Rule 5 of the Rule 1977 in a quantity other than that specified in 3rd schedule is an offence; ie., for clarification you have manufactured a commodity listed under the 3rd schedule in a nonstandard quantity of 225gms”. 11. From the above, the basis of the charge was that the petitioner had manufactured, packaged and marketed the concerned commodity (Toilet Soap) having a net weight of 225gms, (as if it were a single unit) in view of Clause 17 (c) of the 3rd schedule under Rule 5, which stipulates that the standard quantity in which Toilet Soap was to be packaged is 25gms, 50gms, 75gms, 100gms 125gms, 150gms and thereafter in multiplies of 50gms. In other words, the 2nd respondent did not take note of the fact that concerned package having the net weight of 225gms was containing 3 separate units of 75gms each and constituting a ‘multi – piece package’ as defined under Rule 2 (j) of the Rules and that the “additional declaration” liable to be made under Rule 17 of the Rules in the case of ‘multi – piece package’ was very much made by the petitioner on the concerned package as evidenced from Ext. P1.
P1. When the petitioner pointed out the actual facts and the legal provisions, referring to Rule 2 (j) of the Rules defining ‘multi – piece package’ and the scope of “additional declaration” under Rule 17, it was to the chagrin of the 2nd respondent, who simply issued Ext. P4 rejecting Ext. P3 explanation and holding that Rule 17 of the Packaged Commodities Rules was not attracted to the case in hand – the package not being a ‘multi – piece package’ since the individual pieces contained inside were neither packaged nor labeled to be suitable for retail sale as individual pieces. Since this Court has already held that the package in question is a ‘multi – piece package’ as defined under Rule 2 (j) of the Rules, the reasoning given by the Respondents cannot be held as correct or sustainable. 12. Rule 17 of the Rule is very much relevant, which is extracted below: “17. Additional declarations to be made on multi-piece packages:- (1) Every multi-piece package shall bear thereon, in addition to the declaration required to be made under any other provisions of these rules, a declaration of- a) the number of individual pieces contained thereto: b) the retail sale price of the multi-piece package” Provided that where individual pieces contained in a multi –piece package are packaged or labeled separately and are capable of being sold separately, each piece shall bear thereon a declaration as to the quantity and the retail sale price thereof. (2) If the individual pieces contained in the package do not carry retail sale price, it shall carry a declaration that they are not intended for retail sale. The proviso to Sub Rule 1 of Rule 17 clearly says that the individual pieces contained in the ‘multi – piece package’ shall contain a declaration as to the quantity and the retail price, to be shown separately, only if such individual pieces are packaged or labeled separately and are capable of being sold separately. In other words, if the individual pieces are not intended to be sold separately, no such declaration is necessarily to be made on the individual pieces and only the declaration as provided under Sub Rule 2 of the Rule 17 alone needs to be made on the ‘multi-piece package’, stating that the individual pieces contained therein are not intended for retail sale. 13.
13. Coming to the case in hand, the petitioner has clearly shown on Ext. P1 ‘multi – piece package’ that it contains 3 individual Units of the Toilet Soaps having a weight of ’75 gms’ each and thus constituting the net weight of 225 gms, proposed to be sold for a maximum retail price of Rs. 50/-with a specific declaration (as contemplated in Rule 17 (2) of the Rules) that it was a ‘multi – piece package’ and that the individual units were not for loose sale. It is further pointed out from the part of the petitioner that apart from the above product marketed as a ‘multi – piece package’ containing 3 individual units, as part of the market promotional scheme, which is pursued only for short spells, separate individual units are always available in the market enabling the consumer either to purchase the same or to go for the ‘multi-piece package’ and that the consumers are very much in a position to compare the prospective benefit on choosing to purchase the ‘multi-piece package’ – which is stated as in the tune with the legislative intent behind Sec. 39 (5) of the Act and hence not assailable. This being the position, it is very much clear that the petitioner has satisfied all the requirements as contemplated under the relevant provisions of law and there cannot be any inference as to the violation in this regard. 14. In this context, it is relevant to note that a similar contention was mooted by the counter part of the Respondents 1 & 2 situated in Maharashtra, stating that the declaration as contemplated under Sub Rule (2) of Rule 17 is actually to be made ‘on the individual units’ and not on the ‘multi-piece package’, since the words used “it shall carry” denote the individual unit alone. Referring to the relevant facts and figures, it was held by a Division Bench of the Mumbai High Court (Aurangabad Bench) in Crl. Writ Petition No. 223/07 that the word “it” appearing in sub rule (2) of Rule 17 denotes the ‘multi-piece package’ and the term “they” in the very same sub Rule denotes the ‘individual packets’.
Referring to the relevant facts and figures, it was held by a Division Bench of the Mumbai High Court (Aurangabad Bench) in Crl. Writ Petition No. 223/07 that the word “it” appearing in sub rule (2) of Rule 17 denotes the ‘multi-piece package’ and the term “they” in the very same sub Rule denotes the ‘individual packets’. It was held by the Bench that the Declaration in the case of ‘multi-piece package’, to be made under Rule 17 (2) is on the ‘multi-piece package’ (‘it’), stating that the individual units (‘they’) contained therein were not intended for retail sale. This being the position, there is absolutely no merit or substance in the contentions raised by the Respondents holding that the package in question is not a ‘multi-piece package’ and that Rule 17 is not attracted to the case in hand. 15. The impugned proceedings are further sought to be justified by the Respondents stating that the product manufactured and distributed by the petitioner is having a net weight of ‘225’ gm and hence is of ‘non-standard’ quantity, involving violation of the specification under Clause 17 (c) of the 3rd schedule referred to in Rule 5 of the Rules. The Counter Affidavit dtd. 012.02 filed by the 2nd Respondent (on behalf of the 1st and 2nd respondents says that the quantity being 225gms, “instead of 200gms or 250gms”, there is clear violation of Sec. 39 (5) of the Act and Rule 5 of the Rules. In other words, the idea and understanding of the Respondents is that, since Clause 17 (c) of the 3rd schedule stipulates that the commodity to be packed shall be in the standard weight of 25gms, 50gms, 75gms, 100gms 125gms, 150gms and thereafter in multiples of 50gms, the net weight in the instant case admittedly being 225gms, is not liable to be treated as of standard weight. 16. The standard weight stipulated under the above entry is obviously in respect of the ‘individual items’ to be packed and never the total weight of the ‘multi-piece package’ defined under Rule 2 (j) of the Rules. This is more evident from the fact that the 3rd schedule does not contain any entry or reference as ‘multi-piece package’, obviously since the purpose of enactment of Sec. 39 (5) of the Act and necessary Rules framed is more to enable the consumers to make comparative analysis, and not to be misled.
This is more evident from the fact that the 3rd schedule does not contain any entry or reference as ‘multi-piece package’, obviously since the purpose of enactment of Sec. 39 (5) of the Act and necessary Rules framed is more to enable the consumers to make comparative analysis, and not to be misled. Since the number of units available, weight of each unit and the price payable are very much shown on Ext. P1 ‘multi-piece package’, there is no chance for any consumer to have got confused or misled in any manner. The stand of the Respondents that the consumer will get confused since the net weight is shown on Ext. P1 as ‘225’gms, though it has been clearly stated that it contains 3 individual units of 75gms (suggesting that there will not be any such confusion to the consumer, if the net weight was shown as 200gms or 250 gms), is rather puerile. The stipulation under entry No. 17 (c) of the 3rd schedule referred to in Rule 5 of the Rules is hereby declared as having relevance only with reference to the ‘Individual Units’ and not with reference to the ‘multipiece package’ defined under Rule 2 (j) of the Rules containing the individual units. 17. The question whether the net weight shown on the ‘multi-piece package’ should also be in conformity with the entry under the 3rd schedule or whether compliance of Rule 17 alone is enough, had come up for consideration before this Court in Crl. M.C 2714/03 filed by the petitioner herein and 2 others (very same persons whose names have been shown by the 2nd respondent in Ext. P4). After analyzing the provisions of law, it was specifically held by this Court that there was no prohibition in the ‘multi-piece package’ being sold in one unit, in which event, what is required is only the compliance of Rule 17 (1) and 17 (2) of the Rules and not the stipulation provided under entry No. 17 (b) of the 3rd Schedule. In the instant case, the only difference is that the relevant entry is clause ’17 (c)’ of the 3rd schedule, instead of clause ’17 (b)’ of the very same schedule, dealt with in former case. 18. Viewed in the above circumstance, the challenge raised by the petitioner against the impugned proceedings taken by the Respondents 1 & 2 is very much justified.
18. Viewed in the above circumstance, the challenge raised by the petitioner against the impugned proceedings taken by the Respondents 1 & 2 is very much justified. The impugned orders/proceedings Ext. P2, P6 & P7 are set aside. It is declared that the ‘multi-piece package’ defined under Rule 2 (j) of the Rules, on satisfying the requirement under Rule 17 of the Rules, does not attract the stipulation under clause 17 (c) of the 3rd schedule mentioned under Rule 5 of the Rules but for the individual units contained in the ‘multi-piece package’, which of course shall be of standard weight. The Writ Petition is allowed accordingly. No cost.