Monday, August 31, 2015 08:00 IST
With the fate of the Government of India class suit against Nestle India claiming a whopping Rs 649 crore as damages hanging in balance, the industry is worried about the adoption of a US style class action in the country. According to industry sources, the action appears to have a political ‘overtone’ and reflects prejudice on part of the government.
An industry representative not wanting to be named says, “Upholding consumer rights is a good idea but despite Bombay High Court’s verdict setting aside the ban by FSSAI (Food Safety and Standards Authority of India), following the case is not desirable.”
The representative said that this is not justified and this has put a question mark on the system as a whole. “ (The industry is not running away from its responsibility towards consumer rights but they (government) should create system like in Western countries to facilitate industry rather than selectively following actions,” he said.
Meanwhile, government sources say that they are going ahead with the suit. This though the Bombay High Court had set aside the ban on Nestle saying that the apex food regulator did not follow the principle of natural justice and that the labs in which the tests were carried out for presence of Lead were not duly accredited. The tests formed the basis on which the ban was imposed.
Justice V M Kanade and B P Colabawalla of the Bombay High Court in its judgment, with regards to the petition filed by Nestle India Ltd against order by FSSAI banning all variants of Maggi noodles, had ruled that the food regulator’s ban was arbitrary.
Nestle India challenged the nationwide ban imposed by the food authority on its popular product Maggi instant noodles in June.
The food authority claimed that in public interest and to ensure food safety, the orders were passed after the food laboratory reports indicated the presence of Lead in excess of the permissible limits and MSG being found in the product against the declaration of Nestle that there was “No added MSG” in the product.
The court observed after hearing the argument that principles of natural justice were not followed before passing the orders and on that ground alone the orders were liable to be set aside, particularly when the Petitioner – Company, one day prior to the orders, had given a press release that it had recalled the product till the authorities were satisfied about the safety of its product.
Nestle has been asked to send five samples of each batch to three food laboratories accredited and recognised by NABL as per the provisions of Section 3(p) and Section 43 of the Act .
“Secondly, we have held that the food laboratories where the samples were tested were not accredited and recognised laboratories as provided under the Act and Regulations for testing presence of Lead and therefore no reliance could be placed on the said results. We have further held that the mandatory procedure which has to be followed as per Section 47(1) of the Act and Regulations framed thereunder, was not followed,” the judges observed.
The orders by FSSAI were held to be arbitrary and violative of Articles 14,19(1)(g) of the Constitution of India. They said, “Although we are setting aside the impugned orders, in public interest and in order to give an opportunity to the petitioner to satisfy the food authority, we have directed that five samples from each batch cases out of 750 may be tested in three laboratories mentioned hereinabove and if the Lead is found within permissible limits then the Petitioner would be permitted to manufacture all the variants of the noodles for which product approval has been granted by the food authority. These in turn would be tested again in the three laboratories (in Mohali, Hyderabad,and Jaipur) and if Lead is found within permissible limits then the Petitioner would be permitted to sell its products.The three laboratories shall follow the procedure laid down under Section 47 of the Act and Rules and Regulations framed thereunder.”
The court also set aside the allegation of misbranded products and said that since the Petitioner – Company has already made statement that it will delete the declaration made by it viz “No added MSG” on its product, no prejudice would be caused to the public at large and the allegation that product is misbranded also will not survive.
The court concluded that nine variants of Maggi noodles should be tested and may be manufactured after positive report is given in respect of the variants which are available. For “Maggi Oats Masala Noddles with Tastemaker,” Nestle will have to undergo the procedure of obtaining Product Approval.