Bombay High Court
Mumbai Bidi Tambaku Vyapari Sangh And ... vs Union Of India (Uoi) And Anr. on 21 November, 2002
Equivalent citations: AIR2003BOM153, [2003]44SCL481(BOM), AIR 2003 BOMBAY 153, 2003 CLC 375 (BOM), 2003 (2) FAC 162, (2003) 1 ALLMR 1127 (BOM), (2003) 2 MAH LJ 147, (2003) 2 FAC 162, (2003) 4 BOM CR 300
Author: D.B. Bhosale
Bench: R.M. Lodha, D.B. Bhosale
JUDGMENT D.B. Bhosale, J.
1. In this writ petition under Article 226 of the Constitution, the petitioners have sought declaration that Rules 2(r) and 23(2) of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 (for short "the Rules") are ultra vires provisions of the Standards of Weights and Measures Act, 1976 (for short "the Act") and, therefore, void ab initio, nonest and without any effect in law. The declaration has also been sought that Rules 2(r) and 23(2) are violative of Articles 14, 19(1)(g) and 21 of the Constitution. Rule 2(r) of the Rules, defines "retail sale price" which in short means the maximum price at which the commodity in the packaged form may be sold to the ultimate consumer and where such price is mentioned on the package. Rule 23(2) of the Rules prohibits retail dealer or other persons including manufacturer, packer and wholesale dealer from making any sale of any commodity in packaged form at the price exceeding the retail sale price thereof.
2. The first petitioner is a trade union registered under Trade Unions Act, 1926. It has as its members the small retailers selling prepackaged goods in Bombay. Petitioner No. 2 is an unregistered association which has as its members small retailers including the members of petitioner No. 1. Petitioner No. 3 is a small retail trader and a member of petitioner No. 1. He is inter alia engaged in retail selling of pre-packaged materials namely cigarettes, soaps, toiletery items, biscuits etc. According to the petitioners the retail traders such as petitioner No. 3, sell goods in pre-packaged form which are manufactured all over India. They are all small retail traders whose turnover is always very low and they earn their profits from the commission that they charge on the sales.
3. The petitioners have filed this petition in the representative capacity seeking leave under Order 1, Rule 8 of the Code of Civil Procedure on their behalf and on behalf of persons who have similar interest.
4. It is the case of the petitioners that the turnover of the retail traders who are members of the 1st petitioner association is approximately Rs. 600 -- Rs. 700/-, per day. On an average the commission of 10% profits work out to Rs. 60 -- Rs. 70/- per day and on a 26 days basis it works out to Rs. 1820/- per month. According to the petitioners the actual commission for similar retailers is at times almost nil. The petitioners have quoted two instances so as to support the contention that at times the commission is almost nil. We do not deem it necessary to reproduce those instances for adjudicating the issue involved in the present writ petition. In short, the petitioners contention is that the difference between the purchase price for the members of their association of pre-packaged commodities and the retail sale price which has to be published on various brands of pre-packaged commodities like cigarettes, biscuits does not fetch the commission of more than 10%. It is, therefore, unreasonable to impose a maximum retail price which does not allow the retailer to have atleast 15% to 20% commission on their sales. The petitioners have also demonstrated in the writ petition, the efforts made by them in order to get more commission on the retail sale price of prepackaged commodities. According to the petitioners as a result of their efforts, they were, in fact getting 15% to 20% commission which made their business economically viable. However, after the 1990 amendment to the Rules, by which the restrictions have been imposed on retail dealers including manufacturers, packers and wholesale dealers, that they shall not make any sale of any commodity in packed form at the price exceeding the retail sale price thereon, the things changed and the profit margin of the members of petitioners' association started vitally affecting. According to the petitioners for no fault of their's and because of the intense competition of various manufacturers who control the retail price after the 1990 amendment, the retailers are being squeezed out of the market as there is no provision in the Act to protect the commission and the profit margin of the retail traders.
5. In the aforestated background the petitioners have filed present writ petition contending that the provisions of the Act do not empower the Central Government to define a retail sale price, in excess of which the retailer has no right to sell the commodity. According to petitioners the Act and the Rules framed thereunder do not regulate or control the manufacturers price of prepacked commodities. The manufacturers have absolute discretion as to what price they should charge from the distributors, wholesalers or retailers. According to the petitioners, the distributors also do not maintain price lists of pre-packaged commodities nor is there any control maintained on them either under the Act or the Rules. They are also entitled to charge whatever price they want to charge from the retailers. The retailers on other hand, are prevented from selling the pre-packaged commodity for any price in excess of the retail price declared by the manufacturer in the printed form of the pre-packaged commodity in accordance with the provisions of the Act and the Rules. Therefore, in petitioners submission, the operation of the Act allows complete discretion to the manufacturers and wholesalers to determine the manufacturing or wholeselling price as well as the retail price of the retailer and gives no discretion to the retailer to decide his selling price. In other words, manufacturers and wholesalers are allowed to determine the buying and selling prices of the retailers. This, according to the petitioners, is in total contrast to the normal commercial practise. The petitioners have, therefore, submitted that the Act. by allowing the manufacturers to determine the maximum retail price for the retailer and not controlling either the manufacturing or wholesale price is totally arbitrary, unjust and unfair to the ultimate retailer and hence the Act is violative of Articles 14, 19(1)(g) and 21 of the Constitution.
6. Neither respondent No. 1 -- Union of India nor respondent No. 2 State of Maharashtra have filed the reply affidavits. We have heard Ms. Neeta Karnik, learned counsel appearing for the petitioners and Mr. H. V. Mehta, learned counsel for respondent No. 1, perused the writ petition and annexures thereto and have gone through various provision of the Act and the Rules with assistance of the learned counsel for the parties.
7. Ms. Neeta Karnik, learned counsel for the petitioners submitted that whether the manufacturers/packers can arrive at the retail sale price inasmuch as the sale price arrived at by them can protect the retail dealers' right to livelihood. She further submitted that it is not permissible for the rule making authority to have artificially defined concept of the "retail sale price" as the same does not take note of the fluctuations in price, the cost of freight being different from place to place, the local taxes being different and the Central taxes being dependent on the local taxes and is beyond the rule making authority. In her submission Rule 23 which prevents the retail dealers from selling the commodities in the packaged form at the price exceeding the retail sale price thereof is unreasonable inasmuch as it imposes unreasonable restrictions on the fundamental right guaranteed under Article 19(1)(g) and are also violative of Articles 14 and 21 of the Constitution. Ms. Karnik submitted that the restrictions put upon the petitioners by the amended Rule 2(r) and Rule 23 of the Rules do not have any rational nexus to the objects sought to be achieved by the Act and that such restrictions cannot be termed as reasonable restrictions on the petitioners' freedom of trade and commerce.
8. In opposition, the learned counsel appearing for respondent No. 1 placed heavy reliance on the judgment of Karnataka High Court in a case of M/s. T. T. (Pvt.) Ltd. v. Union of India, , and submitted that the definition of "retail sale price" in Rule 2(r) has substituted the definition of "sale price" under Rule 2(s), which has been omitted by GSR 511(E) dated 25-5-1990 in the Rules. The expression "sale price" was defined under deleted Rule 2(s) was under judicial scrutiny before Karnataka High Court in the aforesaid case when it was held to be valid as it falls within Entries 42 and 50 of List I of Schedule VII of the Constitution. The definition of "sale price" in Rule 2(s) was held to be reasonable and within the rule making power in the aforesaid judgment of the Karnataka High Court. It was further submitted on behalf of the respondents that the Act was enacted to safeguard and protect the interest of purchaser and consumer and not for the benefit of retailer. The financial loss, if any is being caused to the retailer, could be taken care of by the contract and/or understanding between the manufacturers and retailers.
9. The Act was enacted to establish the Standards of Weights and Measures, to regulate inter-State trade or commerce in Weights, Measures and other goods which are sold or distributed by Weight, Measure or Number and to provide for matters connected therewith or incidental thereto. It would not be out of place if we make specific reference to paragraphs 5 and 6 in the statement of objects and reasons (for short "SOR") to determine the intention, purpose or object of the Legislature in enacting the Act and framing the Rules thereunder. Paragraphs 5 and 6 of the SOR read thus :
"5. The Bill further provides for consumer protection in respect of packaged commodities by providing, in pursuance of the recommendations of the OIML for the proper indication on the package of net quantity by weight, measures or number, the identity of the commodity contained therein, name of the manufacturer, and what is very important, the price of the package. It is also proposed that commodities commonly used by people should be packed in rationalised standard quantities by weight, measure or number, so as to facilitate the purchase and comparison of price by the people. Further, indication of date of manufacture and date of expiry would also be marked for appropriate products.
6. A further provision for consumer protection is the approval of models of weights, measures and weighing and measuring instruments, which is recommended by the OIML, draft law. The scientific evaluation of the performance accuracy and dependability of weights, measures etc. would, enable the consumer to buy his requirements with greater confidence about accuracy and also give industries the facility to use more accurate measuring instruments in their production control and enable the scientists to measure accurately the quantities involved in their researches. All these benefits will contribute to national development."
The law is well settled that the SOR accompanying the legislative bill could not be used to determine the true meaning and effect of the substantive provisions of a statute. However, it is permissible to refer to the same for the purpose of understanding the background, the antecedent factual matrix leading to the Legislation, the surrounding circumstances in relation to the statute, and the evil which the statute sought to remedy. It would not be inappropriate to look into the circumstances which prevailed at the time when the law was passed and which necessitated the passing of that law to determine the purpose, intention and object of the Legislation. It is also well settled that though the SOR is one of the vital keys to the interpretation of the provisions of the Act, the intention of the Legislature is not necessarily to be gathered from the SOR only but to be gathered from the provisions of the Act. Keeping in view the SOR and the aforestated well settled propositions of law, it would be advantageous at this stage to refer to the relevant provisions of the Act and the Rules for better appreciation of the submissions advanced by the learned counsel for the parties before us.
10. The Act is divided into eight parts. However, in the present petition we are concerned with the provisions in part I, Part IV and Part VIII of the Act, Part I of the Act provides definitions which includes expression "sell" which means transfer of property in any weight, measure or other goods by one person to another for cash or for deferred payment or for any other valuable consideration, and includes transfer of any weight, measure or other goods on the higher purchase scheme or any other system of payment by instalments. Part IV of the Act is further divided into five chapters. Chapter I contains of Section 31 which provides that Part IV of the Act applies to the inter-State trade and commerce only. The clause (b) of Section 31 of the Act provides that the provisions of this part shall apply to goods which are, or are intended to be sold, distributed, delivered or otherwise transferred by weight, measure or number in the course of inter-State trade or commerce. Insofar as Chapters II and III in Part IV are concerned we are not concerned with the provisions contained therein in the present petition. Chapter IV in Part IV deals with the commodities in the packaged form intended to be sold or distributed in the course of inter-State trade or commerce, The sole Section 39 in Chapter IV which shall be relevant for further discussion read thus :
"39. Quantities and origin of commodities in packaged form to be declared; (1) No person shall-
(a) make, manufacture, pack, sell, or cause to be packed or sold; or
(b) distribute, deliver, or cause to be distributed or delivered; or
(c) offer, expose or possess for sale, any commodity in packaged form to which this Part applies unless such package bears thereon or on a label securely attached thereto a definite, plain and conspicuous declaration, made in the prescribed manner of-
(i) the identity of the commodity in the package;
(ii) the net quantity, in terms of the standard unit of weight or measure, of the commodity in the package;
(iii) where the commodity is packaged or sold by number, the accurate number of the commodity contained in the package;
(iv) the unit sale price of the commodity in the package; and
(v) the sale price of the package.
Explanation.-- In this sub-section, the expression "unit sale price" means the price according to such "unit of weight, measure or number as may be prescribed.
(2) Every package to which this Part applies shall bear thereon the name of the manufacturer and also of the packer or distributor.
(3) Where the package of a commodity to which this Part applies or the label thereon bears a representation as to the number of servings, of the commodity contained therein, such package or label shall also bear a statement as to the net quantity (in terms of weight, measure or number) of each such serving.
(4) The statement on a package or label as to the net weight, measure or number of the contents thereof shall not include any expression which tends to qualify such weight, measure or number:
Provided that the Central Government may, by rules, specify the commodities, the weight or measure of which is likely to Increase or decrease beyond the prescribed tolerance limits by reason of climatic variations; and it shall be lawful for the manufacturer or packer of the commodity so specified to quality the statement as to the net content of such commodity by the use of the words "when packed".
Explanation.-- The words "when packed" shall not be used in any case except a case to which the proviso to Sub-section (4) applies.
(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 packed for sale, distribution or delivery and such undue proliferation impairs in the opinion of that Government, 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 the packers or distributors to sell, distribute or deliver such commodity in such standard quantities or number as may be prescribed.
(6) Whenever the retail price of a commodity in packaged form to which this Chapters applies is stated in any advertisement, there shall be included in the advertisement, a conspicuous declaration as to the net quantity or number of the commodity contained in the package and retail unit sale price thereof.
(7) No person shall sell, distribute or deliver for sale a package containing a commodity which is filled less than the prescribed capacity of such package except where it is proved by such person that the package was so filled with a view to-
(a) giving protection to the contents of such package, or
(b) meeting the requirements of machines used for enclosing the contents of such package.
(8) The Central Government may, by rules, specify such reasonable variations in the net contents of the commodity in package as may be caused by the method of packing or the ordinary exposure which may be undergone by such commodity after it has been Introduced in trade or commerce.
(9) The Central Government may by rules, specify the classes of commodities or packages in relation to which all or any of the provisions of this section shall not apply or shall apply with such exceptions or modification as may be specified therein."
Thus, Section 39 provides that no person shall make, manufacture, pack sell, distribute, deliver, offer, expose or possess for sale, any commodity in packaged form to which Part IV applies unless such package appears thereon or on a label securely attached thereto a definite, plain and conspicuous declaration, made in prescribed manner, amongst other things, the sale price of the package. Sub-section (6) of Section 39 specifically provides whenever the retail price of a community in packaged form to which this chapter applies is stated in any advertisement. There shall be included in the advertisement, a conspicuous declaration as to the net quantity or number of commodity contained in the package and retail unit sale price thereof. The expression "retail price" and "retail sale price" used in subsection (6) have been defined in the Rules and not in the Act. Section 83 in Part. VIII of the Act, empowers the Central Government to make rules for carrying out the provisions of the Act. In exercise of the aforesaid powers, the Central Government made the Rules. Clause (r) in Sub-section (2) of Section 83 specifically empowers the State Government to make rules in the matters of the manner of declaration of the contents of a package and specification of the unit of weight, measure or number in accordance with which the retail price shall be declared on the package.
11. In exercise of powers conferred by Section 83 of the Act, the Central Government has framed the Rules which are divided into six chapters. However, in the instant writ petition we are concerned with Chapter I which provides definitions of different expressions used in the Rules of the Act and Chapter II which deals with the provisions applicable to the packages Intended for the retail sale. The petitioners have challenged the validity of Rule 2(r) and Rule 23 in Chapters I and II of the Rules. Clause (r) defines "retail sale price" which read thus :
"(r) "retail sale price" means the maximum price at which the commodity in packaged form may be sold to the ultimate consumer and where such price is mentioned on the package, there shall be printed on the packages the words "Maximum (or Max) retail price. ...... .inclusive of all taxes."
Explanation.-- For the purpose of this clause "maximum price" in relation to any commodity in packaged form shall include all taxes local or otherwise, freight, transport charges, commission payable to dealers, and all charges towards advertising, delivery packing, forwarding and the like, as the case may be.
By Amending the Rules in 1990, Rule 2(r) has been substituted (vide GSR 511(E) on 25th May, 1990) and at the same time Clause (s) defining "sale price" came to be omitted with effect from 25th May, 1990. By the said amendment, in the entire Rules, for "sale price" wherever it occurs the words "retail sale price" were substituted. Meaning thereby wherever, expression "sale price" occurs the words "retail sale price" are substituted. Clause (s) which was omitted by GSR 511(E) dated 25th May, 1990 read thus :
"(s) "sale price", in relation to the commodity in packaged form means any one of the following prices, namely :
(i) Price inclusive of freight but exclusive of local taxes, and where such price is mentioned on the package, there shall be printed on the package the words "Max. price. .....
local taxes extra";
(it) retail sale price, and where such price is mentioned on the package, there shall be printed on the packaged the words, "max, retail price".
12. Rule 3 in Chapter II provides that the provisions of aforesaid Chapter shall apply to packages intended for retail sale and the expression "package", wherever it occurs shall be construed accordingly. Rule 4 provides that no person shall pre-pack, or cause or permit to be pre-packed any commodity for sale, distribution or delivery unless the package in which the commodity is pre-packed bears thereon, or on a label securely affixed thereto, such declarations as is required to be made under the Rules. Under Rule 5, specific commodities are required to be packed and sold only in standard packages. Rule 6 provides that every package shall bear thereon or on a label securely affixed thereto a definite, plain and conspicuous declaration made in accordance with the provisions of Chapter II. Clause (f) of sub-rule 1 of Rule 6 provides that every package shall bear thereon or on a label securely affixed thereto a declaration as to the "retail sale price" of the package. A perusal of Rule 6(1) of the Rules clearly shows that stress of sub-rule is upon the package and not upon the person manufacturing or selling the package. Rule 9 provides the manner in which the declaration shall be made on package under the Rules. Rule 23 deals with the provisions relating to the retail or wholesale dealers. Rule 23, validity of which is under challenge in the instant writ petition, read thus:
"23. Provisions relating to wholesale dealer and retail dealers-
(1) No wholesale dealer or retail dealer shall sell, distribute, deliver, display or store for sale any commodity in the packaged form unless the package complies with, in all respects, the provisions of the Act and these rules.
(2) No retail dealer or other person including manufacturer, packer and wholesale dealer, shall make any sale of any commodity in packaged form at a price exceeding the retail sale price thereof.
Explanation.-- For the removal of doubts, it is hereby declared that a sale, distribution or delivery by a wholesale dealer to a retail dealer or other person is a "retail sale" within the meaning of this sub-rule.
(3) Where a package intended for sale in which a commodity has been pre-packed is opened and the commodity contained therein is sold to one or more persons, the price to be charged from the purchaser shall bear the same proportion to the price of the package as the quantity sold to the purchaser bears to the total quantity contained in the package:
Provided that where any package containing any commodity specified in the Eight Schedule is opened for the purpose of selling such commodity in smaller quantities in unpacked form, the price charged for the sale of such smaller quantities may exceed the proportionate price of such quantity by not more than five per cent of such proportionate price:
Provided further that where any package, which has been damaged package may be sold in any quantity at a price which may be lesser than the proportionate price thereof.
(4) Where, after any commodity has been pre-packed for sale any tax payable in relation to such commodity is increased or any fresh tax is imposed on such commodity, the retail dealer or any other person, shall not make any retail sale of such commodity at a price exceeding the revised retail sale price, communicated to him by the manufacturer, or where the manufacturer is not the packer; and it shall be the duty of the manufacturer or packer as the case may be; to indicate by not less than two advertisements in one or more newspapers and also by circulation of notices to the dealers and to the (Director in the Central Government and Controllers of Legal Metrology in the States and Union territories) the revised prices of such packages, but the difference between the price marked on the package and the revised price shall not, in any case, be higher than the extent of increase in the tax or in the case of imposition of fresh tax, higher than the fresh tax so imposed :
Provided that publication, in any newspaper, of such increased price shall not be necessary where such increase is due to any increase in, or imposition of, any tax payable under any law made by the State Legislature :
Provided further that retail dealer or other person, shall not charge such revised prices in relation to any packages except those packages which bear marking indicating that they were pre-packed in the month in which such tax has been Increased or fresh tax has been imposed on in the month immediately following the month aforesaid :
Provided also where the revised prices are lower than the price marked on the packaged, the retail dealer or other person shall not charge any price in excess of the revised price, irrespective of the month in which the commodity was pre-packed.
(5) Nothing in sub-rule (4) shall apply to a package which is not required, under these rules to indicate the month and the year in which it was pre-packed.
(6) No retail dealer or other person shall obliterate, smudge or alter the retail sale price, indicated by the manufacturer or the packer, as the case may be, on the package or on the label affixed thereto."
Rule 23 imposes restrictions not only on the retail dealers but also on other person including manufacturer, packer and wholesale dealer from making any sale of any commodity in packaged from at a price not exceeding the "retail sale price" thereof.
13. The Ss. 39 and 83 of the Act, though use expression "retail price", "unit sale price", "retail unit sale price" and "retail sale price", the Act does not define them. However, in exercise of the power conferred under Section 83 of the Act, the Central Government made the Rules, which define the expressions namely "retail sale", "retail sale price" and "unit sale price". The "retail sale" is defined under clause (q) of Rule 2 which provides that the retail sale in relation to a commodity, means the sale, distribution or delivery of such commodity through retail sales agencies or other instrumentalities for consumption by an individual or group of individuals or any other consumer. In so far as "unit sale price" as defined in clause (v) of Rule 2 is concerned, it means the retail sale price per specified unit of weight, measure or number. Clause (r) of Rule 2 defines "retail sale price" which means maximum price at which the commodity in the package from may be sold to the ultimate consumer. The expression "maximum price" used in the definition of the "retail sale price" has been explained to mean that the price of any commodity in packaged from shall include taxes local or otherwise, freight, transport charges, commission payable to the dealers, and all charges towards advertising, delivering, packing, forwarding and the like, as the case may be. In other words, the definition of the "retail sale price" in Clause (r) of Rule 2 is stated to mean what ultimately a purchaser pays for getting the goods in his hands which may include everything that goes into the making of the consideration, such as, the value of the goods at which the dealers sell, the freight charges, commission payable, the taxes that may be payable on the same including excise duty. It is clear that the expression "retail sale price" is susceptible to more than one meaning and it may include everything in one sense as stated earlier or it may not be everything depending on the context and circumstances in which it is used. Keeping in view the SOR, the intention of Legislature and the powers conferred on the Central Government under Section 83 of the Act it cannot be said that the rule making authority defined "retail sale price" without taking into consideration the fluctuation in price which is due to the cost of freight being different from place to place, the local taxes being different and that it is beyond the rule making authority. The close scrutiny of Rule 2(r), Rule 6(1) and Rule 23 show that the stress of these rules is upon the consumer and not upon the person manufacturing or selling the package.
14. Section 39 of the Act deals with the quantities and origin of commodities in packaged form to be declared. It provides that no person shall make, manufacture, pack sell, distribute, deliver, offer, expose or possess for sale of any commodity in packaged form to which part IV applies unless such package bears thereon or on a label securely attached thereto a definite, plain and conspicuous declaration made in the prescribed manner, of the sale price of the package. Sub-section (6) of Section 39 specifically provides that whenever the "retail price" of a commodity in packaged form to which Chapter IV applies is stated in any advertisement, there shall be included in the advertisement, a conspicuous declaration as to the net quantity or number of the commodity contained in the package and the "retail unit sale price" thereof. The stress in this provision is also upon the consumer and not upon the person manufacturing or selling the package.
15. Rule 23 of the Rules would show that no wholesale dealer or retail dealer shall sell, distribute, deliver, display or store for sale any commodity in the packaged form unless the package complies with, in all respects, the provisions of the Act and the Rules. Similarly no retail dealer or other person including manufacturer, packer and wholesale dealer shall make any sale of any commodity in packaged form at a price exceeding the "retail sale price" thereof. It further provides that where a package intended for retail sale in which a commodity has been pre-packed is opened and the commodity contained therein is sold to one or more per sons, the price to be charged from the purchaser shall bear the same proportion to the price of the package as the quantity sold to the purchaser bears to the total quantity contained in the package. No retail dealer or other person shall be allowed to obliterate, smudge or alter the "retail sale price", indicated by the manufacturer or packer as the case may be, on the package or on a label affixed thereto. It is thus, clear that, the provision is principally made for the protection of consumers. The retail dealers are therefore, obliged to comply with the provisions of Rule 23 notwithstanding the restrictions imposed on them by this provision. The contention that Rule 23(2) of the Rules is unreasonable restriction on the fundamental rights under Article 19(1)(g) of the Constitution and they are also violative of Articles 14 and 21 of the Constitution also, therefore, must be rejected.
16. The close scrutiny of Section 39 of tin-Act, Rule 2(r) and Rule 23 of the Rules would show that the protection of consumers, in respect of packaged commodities by providing on the package net weight, measure or number, identity of the commodity contained therein, name of the manufacturer and the price of the commodity, is of paramount consideration. Scrutiny of all the relevant provisions in the Act, would, thus, show that by this enactment what is controlled is a price of the commodity and what is taken care of, is an interest of the ultimate consumer only. It cannot, therefore, be said that Rule 2 (r) and Rule 23 do not have any rational nexus to the objects sought to be achieved by the Act and that such restrictions on the freedom of trade and commerce are unreasonable restriction and that these rules are ultra vires Section 39 of the Act. Viewed thus, the contention raised on behalf of the petitioners that the "retail sale price" as defined is not practicable to comply with and beyond the rule making power cannot be accepted at all and the contentions in that regard must be rejected. As a matter of fact the whole object and purpose of the Act has been to enact a law for the purpose of setting out standards in weights and measures and to make provisions for the protection of consumers. One of the most important rights of the consumer today, amongst other rights, is to be fully informed of the product and also to choose from a sufficient number of alternatives to ensure the objective price and quality and in that regard if a rule is made as to the manner of declaration on the package, the maximum sale price along with the contents of package and specifications of the unit, weight, measure or number it cannot be said that it is beyond the scope of the Act. We are of the considered view that in so far as the apprehension expressed by the petitioners, in respect of the financial loss likely to cause them, is concerned that should be taken care of by the contract/understanding between the manufacturers, packers and the retail dealers.
17. Before we conclude we make reference to the judgment of the Karnataka High Court in a case of M/s T.I. Pvt. Ltd. (supra) relied upon by learned counsel for the respondents. In this judgment while dealing with the issue as to whether the definition of "sale price" in Rule 2(s) is ultra vires the provisions of the Act and violative and unreasonable restriction on the fundamental rights under Article 19(1)(g) of the Constitution, in paragraphs 10 and 11 held thus :
"10. The concept of sale price has been subject matter of judicial interpretation, at any rate, in matters arising under the Sale of Goods Act, the Transfer of Property Act and the Sales Tax legislations. Many a time this expression is stated to mean that ultimately a purchaser pays for getting the goods to his hands which may include everything that goes into the making of the consideration, such as, the value of the goods at which the dealer sells, the freight charges, commission payable, the taxes that may be payable on the same including excise duty. Sometimes, some of these components going to make sale price are excluded. Therefore, the expression "sale price" is susceptible of more than one meaning and it may include everything in one sense as stated earlier or it may not be everything depending on the context and circumstances in which it is used. It is a term which has no fixed connotation or meaning but is capable of varied meanings including or excluding the freight charges or taxes or commission payable depending upon the context of the transaction. It cannot, therefore, be said that it is not competent to the authority delegated with the powers to make rules to define the sale price by including in its ambit all those elements that are mentioned in the definition at Rule 29(s) of the Rules. Viewed thus, the contention raised on behalf of the petitioners that the sale price as defined is unreasonable and not practicable to comply with and beyond the rule making power cannot be accepted at all and the contentions in that regard will have to be rejected.
11. The contention that Rules 6 and 23 of the Rules are unreasonable restriction on the fundamental rights under Article 19(1)(g) of the Constitution and they are also violative of the guarantee envisaged in Article 301 of the Constitution also cannot be accepted at all. As stated earlier, when the law has been enacted not only for the purpose of standardisation in weights and measures but also for the purpose of protection of consumers, merely by asking the manufacturers, distributors, dealers wholesale or retail to display the sale price by making the rule cannot in any way be said to be a restriction on anyone's fundamental rights nor does it interfere with the course of inter State trade or commerce. Therefore, the contention in this behalf is plainly without any substance and deserves to be rejected."
We have no reason to disagree with the observations made by the Karnataka High Court in the aforesaid paragraphs. In our view, the Act and the rules reveal that the obligations are not merely upon the retail traders but also on all persons dealing with the goods including the wholesale dealers and the manufacturers. Therefore, by all concerned the compliance of the provisions of the Rules shall have to be made, including the requirements under Rule 2(r) and Rule 23 of the Rules. After examining the matter from various angles we hold that the provision of Rule 2(r) and Rule 23 of the Rules are valid and are not violative of the fundamental rights under Articles 14, 19(1)(g) and 21 of the Constitution.
18. Writ petition is accordingly dismissed, but in the circumstances without any order as to costs.