Karnataka High Court
M/S Avon Beauty Products India Private ... vs Controller Of Legal Metrology on 9 February, 2023
Author: Jyoti Mulimani
Bench: Jyoti Mulimani
-1-
WP No. 25949 of 2013
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 9TH DAY OF FEBRUARY, 2023
BEFORE
THE HON'BLE MS. JUSTICE JYOTI MULIMANI
WRIT PETITION NO. 25949 OF 2013 (GM-RES)
BETWEEN:
M/S. AVON BEAUTY PRODUCTS INDIA PRIVATE LIMITED,
SURVEY NO.58/4, SINGASANDRA VILLAGE,
MANIPAL COUNTY ROAD, HOSUR MAIN ROAD,
BANGALORE - 560 068.
REPRESENTED BY ITS ASSISTANT MANAGER
AND AUTHORISED SIGNATORY,
MR.HARI KRISHNA GVD. ...PETITIONER
(BY SRI.KARAN JOSEPH., ADVOCATE)
AND:
1. CONTROLLER OF LEGAL METROLOGY
DEPARTMENT OF LEGAL METROLOGY,
GOVERNMENT OF KARNATAKA
Digitally signed by NO.1, ALI ASKER ROAD,
THEJASKUMAR N
Location: HIGH FLYING SQUAD - 2,
COURT OF BANGALORE - 560 052.
KARNATAKA
2. ASSISTANT CONTROLLER OF METROLOGY
DEPARTMENT OF LEGAL METROLOGY,
GOVERNMENT OF KARNATAKA,
NO.1, ALI ASKER ROAD,
FLYING SQUAD - 2,
BANGALORE - 560 052. ...RESPONDENTS
(BY SRI.V.SHIVA REDDY., HCGP)
-2-
WP No. 25949 of 2013
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 &
227 OF THE CONSTITUTION OF INDIA, SEEKING CERTAIN
RELIEFS.
THIS PETITION, COMING ON FOR PRELIMINARY HEARING
IN 'B' GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER
Sri.Karan Joseph., learned counsel for the petitioner and Sri.V.Shiva Reddy., learned HCGP for the respondents have appeared in person.
2. The brief facts are these:
It is stated that M/s.Avon Beauty Products India Private Limited is a Private Limited Company incorporated under the provisions of the Indian Companies Act, 1956, having its registered office in Bangalore. It is a leading beauty products company in the world and is a Top 100 global brand, with over $10 billion in annual revenue globally. It is also ranked as one of America's most admired companies for more than a decade.
On 19.06.2012, the Inspector of the Legal Metrology, Office of the Assistant Controller, seized the following products of the company :
(i) 75 Nos. of Avon Naturals Cucumber &
Melon Hand Soap (200 ml)
-3-
WP No. 25949 of 2013
(ii) 125 Nos. of Avon Naturals Milk & Honey
Hand Soap (200 ml).
The Inspector seized the above products on the alleged ground that the petitioner had not declared the retail sale price of the products on the label and had therefore violated the provisions of Legal Metrology (Packaged Commodities) Rules of 2011 (for short 'the Rules'). A seizure notice was issued on 19.06.2012.
The petitioner duly replied to the seizure notice through a letter dated 22.06.2012 and explained that it is not violating the Rules and has packaged the aforementioned products in compliance with the Rules. However, the Office of the second respondent issued a Notice on 02.07.2012 alleging that the petitioner - Company had contravened the provisions under Rule 4 read with 6(1)(e) and 6(3) of the Rules by not declaring the retail sale price on the label of the packages. It is also stated that the alleged offense is compoundable at the option of the petitioner and asked the petitioner to appear before the office of the second respondent on 11.07.2012 (erroneously mentioned as 11.06.2012 in the said notice). The petitioner duly appeared before the second respondent on 11.07.2012, -4- WP No. 25949 of 2013 only to be informed that the said Inspector is unavailable owing to a prior commitment and that the date of hearing would be intimated by the Department to the petitioner. The petitioner duly filed a written reply to the Notice dated 02.07.2012 before the Department of Legal Metrology on 11.07.2012.
Subsequently, the petitioner received a notice from the office of the second respondent on 23.07.2012, wherein the petitioner was informed that the next date of hearing would be 30.07.2012. The petitioner duly appeared on 30.07.2012 and filed a written reply against the said notice. The petitioner attended all the hearing dates and explained that there is no violation as alleged in the notice and declined to compound the offense as alleged in the notice. It is said that the second respondent received the reply and also the case laws filed on behalf of the petitioner.
Upon hearing the petitioner, the second respondent vide order dated 21.08.2012 rejected the contentions of the petitioner and stated that the provisions of Rule 2(h) and 8 relied upon by the petitioner would not be attracted. The petitioner challenged the said order by filing an appeal before -5- WP No. 25949 of 2013 the Controller of Legal Metrology - the first respondent. The first respondent upon hearing the matter, vide order dated:10.12.2012 dismissed the Appeal purportedly on the ground that the petitioner had failed to appear before the Assistant Controller of Legal Metrology on various dates and also on the ground that the petitioner had violated the provisions of the Act and Rules. The said order was challenged before this Court and this Court set aside the order and directed the petitioner to appear before the Controller.
After remand, the petitioner appeared before the Controller and provided a detailed explanation with respect to the petitioner Company's stand and also stated that there has been no contravention of the Act and Rules as alleged by the respondent.
Upon hearing the petitioner, the first respondent vide order dated 09.04.2013 passed the order holding that there is a contravention of the Rules. This order is called into question in this Writ Petition on several grounds as set out in the Memorandum of the Writ Petition.
-6-WP No. 25949 of 2013
3. Sri.Karan Joseph., learned counsel for the petitioner submits that the order passed by the first respondent is illegal and arbitrary.
Next, he submitted that the first respondent has failed to understand the meaning and the objective of Rule 6(1) which emphasizes that the declaration on the whole including the sale price of the product shall be given in a plain and conspicuous place for the benefit of the consumers. The petitioner has complied with the provisions of Rule 2 (h) by stamping the sale price of the product at the bottom of the bottle. He also submitted that the first respondent has erred in concluding that the petitioner has failed to give a declaration as per Rule 6(1)(e) and has also erred in concluding that printing the sale price at the bottom of the bottle cannot be construed on a plain or conspicuous place as per Rule 6 (1).
A further submission is made on behalf of the petitioner that the respondents have failed to appreciate that the petitioner packages have all the information as required under Rule 6 which reads as 'Declaration to be made on every package'. The information which is fixed and known in advance -7- WP No. 25949 of 2013 is grouped and provided in one place and the information which is variable and subject to change (e.g., manufacturing date, price, expiry date, batch number) has been provided separately at the bottom of the same package and it is also mentioned on the label that this information is provided at the bottom of the package, thereby providing clear, unambiguous and explicit instruction and information.
Learned counsel vehemently contended that the respondents have failed to appreciate that the petitioner - Company has provided all the information as required under the provisions of the Act and Rules and no information has been withheld from the public. Further, as per Rule 8, every declaration is required to be made under Rules and shall appear on the 'principal display panel' which is defined in Rule 2(h). Hence, he submitted that the package provides unambiguous pre-printed and online information required under the law. But the Authorities have failed to appreciate that the petitioner
- Company has disclosed all the requisite information to be declared in conformity with the Act and Rules and has not concealed any information that is required to be shared by the petitioner with the consumer.
-8-WP No. 25949 of 2013
Lastly, he contended that the respondents have disregarded the explanation offered by the petitioner. Therefore, he submits that the order dated 09.04.2013 is liable to be quashed.
Learned counsel for the petitioner has placed relied on the following decision.
STUDDS ACCESSORIES LIMITED AND OTHERS VS. STATE OF KARNATAKA reported in MANU/KA/4374/2020.
4. Sri.V.Shiva Reddy., learned High Court Government Pleader justified the action of the respondents. He submits that the sale price information is displayed at the bottom of the bottle and the Rules do not provide for the display of the information at the bottom of the bottle.
Next, he submitted that products are packed commodities and are covered under the Rules. If the label is affixed for declarations, all the information including the sale price shall be declared on the label itself.
-9-WP No. 25949 of 2013
A further submission is made that Rule 2(h) and Rule 8 are not applicable when there is a label affixed to packages. He submitted that the above provisions are applicable when the information is directly printed on the package itself without a label on the package.
Learned HCGP vehemently contended that there is a label affixed on the product, hence the sale price has to be declared on the label itself and it cannot be declared in any other place. Hence, he submitted that affixing the sale price at the bottom of the bottle is in clear violation of the Rules. He sought to justify the action. Accordingly, he prayed for the dismissal of the petition.
5. Heard, the contentions urged on behalf of the respective parties and perused the Writ papers and also the Annexures with utmost care.
6. The following points would arise for my consideration.
1. Whether the procedure followed for the search and seizure of the products is in accordance with the provisions of the Legal Metrology Act
- 10 -
WP No. 25949 of 2013and Legal Metrology (Packaged Commodities) Rules 2011.
2. Whether affixation or the declaration of the retail sale price at the bottom of the bottle would amount to an offense/or violation of the Legal Metrology (Package Commodities) Rules, 2011?
The facts have been sufficiently stated and the same does not require reiteration.
Suffice it to note that on the 19th day of June 2012, the Inspector of Legal Metrology, Office of the Assistant Controller, issued a notice under Section 15 (b) of the Act. The notice is produced and marked as Annexure-B. A perusal of the same depicts that the Inspector seized the products i.e., 75 Nos. of Avon Naturals Cucumber and Melon Hand Soap (200 ml); 125 Nos. of Avon Naturals Milk and Honey Hand Soap (200 ml). The Inspector searched and seized the products without a warrant, hence what is required to be considered is whether the action of the Inspector is justified.
- 11 -
WP No. 25949 of 2013Section 15 of the Legal Metrology Act 2009 (for the short 'the Act') sets out the power of inspection, seizure, etc. A bare reading of the Section would indicate that, if an authority, has reason to believe that an offense under the Act appears to have been committed, or is likely to be committed, the Inspector may enter the premises and search and seize the goods. It is relevant to notice that Sub-clause (4) of Section 15 set out that the search or seizure should be carried out in accordance with the provisions of the Code of Criminal Procedure 1973 (2 of 1974). Hence, it is clear that the search and seizure are subject to fulfilling the requirements of the provisions of the Criminal Procedure Code. It is obligatory on the part of the Inspector to record the reasons in writing his grounds of the belief that an offense has been committed or is likely to be committed under the provisions of the Act. It is a fact that such a requirement was not accomplished. Hence, I have no hesitation in saying that the action on the part of the Inspector in the search and seizure of the products is unsustainable.
Let me consider the next point. Sri.Karan Joseph., learned counsel in presenting his argument vehemently contended that the petitioner has stamped the retail sale price
- 12 -
WP No. 25949 of 2013of the product at the bottom of the bottle and there is substantial compliance with Rule 2(h). He also argued by saying that as per Rule 8, every declaration shall be declared on the 'Principal display panel'. The petitioner has provided all the information and no information has been withheld.
Much reliance is placed on Rules 2(h), 6(1)(e) and 8 of the Legal Metrology (Packaged Commodities) Rules 2011. Hence, extracting Rule 2 (h), 6(1)(e) and Rule 8 helps indicate the right approach.
2. Definition.- xxxxxx
(h) "principal display panel", in relation to a package, means the total surface area of the package where the information required under these rules is to be given in the following manner, namely.-
(i) all the information could be grouped together and given in one place; or
(ii) the pre-printed information could be grouped together and given in one place and online information grouped together in another place;"
"6. Declaration to be made on every package.- xxxxx (1)(e) the retail sale price of the package shall indicate that it is the maximum retail price inclusive of all
- 13 -WP No. 25949 of 2013
taxes and the price in rupees and paise be rounded off to the nearest rupee or to paise;
xxxxxx
8. Declaration where to appear. - (1) Every declaration required to be made under these rules shall appear on the principal display panel:
Xxxxx"
In the present case, the following pre-printed and online information has been provided on the package:
PRE- PRINTED INFORMATION ONLINE INFORMATION
• name of the product • Date of manufacturing (Mfd.)
• How to use • Batch number
• List of ingredients • Best use before the date
• Net Quantity (Net Qty.) • Maximum retail price (M.R.P.),
• Name of the manufacturer Incl. of all taxes.
• Manufacturing license no
(M.L.No)
• Customer care details
A notice is issued under Section 15(b) of the Act alleging that the retail sale price is not declared on the label (the label affixed to the package) and that there is a violation of the provisions of the Act.
As per Rule 8, the declaration shall appear on the 'Principal Display Panel'. Rule 2 (h) defines the Principal Display
- 14 -WP No. 25949 of 2013
Panel. Hence, what is required to be declared is that the mandatory declarations and data are to be made available to a consumer when he or she purchases the product. Furthermore, as per Rule 6, a definite, plain, and conspicuous declaration is to be made in accordance with the provisions of chapter II of the Legal Metrology (Packaged Commodities) Rules 2011.
In the present case, the pre-printed information is grouped and given in one place and online information is grouped together in another place. What is required by the Rules is only the making available of the information to the consumers. As long as the details and material particulars are available to the consumers that in my opinion would amount to sufficient compliance with the requirements of the packaging rules. Hence, it can safely be held that the declaration of the retail sale price at the bottom of the bottle would not be a violation of the requirements of the Act and Rules.
Sri.V.Shiva Reddy., learned HCGP in presenting his argument strenuously urged that if the label is affixed for declarations, then all the information including the sale price
- 15 -WP No. 25949 of 2013
shall be declared on the label itself to protect the interest of the consumer.
I have considered the submission made on behalf of the State.
Suffice it to note that the products are hand wash bottles and the retail sale price is affixed at the bottom of the bottle. It is pivotal to note that Rule 2(h) provides for the segregation of the information. The information could be made in two ways.
(i) all the information could be grouped together and given in one place, or
(ii) (ii)the pre-printed information could be grouped together and given in one place, and online information grouped together in another place.
It is pivotal to note that the Rule itself provides for segregation hence, the contention of the State that the retail sale price shall be declared on the label itself is satisfactorily hopeless. The respondents have failed to have regard for the explanation which was offered by the petitioner. To conclude, I can say only this much that the respondents have failed to
- 16 -
WP No. 25949 of 2013have regard to the relevant considerations and disregarded the relevant matter.
The result is that the Writ Petition will be allowed. This Court orders a Writ of Certiorari. The order dated 09.04.2013 passed by the first respondent in Appeal No.CLM/ACT/CR- 126/12-13 vide Annexure-N and the order dated:21.08.2012 in No.ACLM/FS-2/PRO/189/12-13 vide Annexure-H are quashed.
Resultantly, the Writ Petition is allowed.
Sd/-
JUDGE TKN List No.: 2 Sl No.: 7