NCDRC issues notice to Nestle India on Rs 640 crore suit

The National Consumer Disputes Redressal Commission (NCDRC) issued notice to Nestle India on the Rs 640 crore suit, filed against it by the Ram Vilas Paswan-headed ministry of consumer affairs alleging unfair trade practices, false labelling and misleading advertisements in the marketing of Maggi, on Monday.

Taking note of the Bombay High Court's (HC) August 13 judgement quashing the orders of food regulators banning the nine variants of instant noodles in the country, the Bench also directed the government to get the samples tested afresh by accredited labs.

"The High Court has quashed your (Centre's) order on the ground that laboratories were not accredited and recognised ... Second, you did not follow correct procedure, the Bench said adding, "You (Centre) have to satisfy whether you had followed the right procedure in procuring the reports."

Additional solicitor general Sanjay Jain,appearing for the government, said that there is no prescribed standard as such but it was up to the food authority to decide. However, the NCDRC Bench pointed out that this practice has been termed by the HC as arbitrary. The Centre said that in this case, the main question is whether the company has been selling products which, as per the guidelines, are not right.

"As on today, what fresh material do you have to show as the earlier has been rejected by the High Court," the Bench said. It posted next hearing on the matter for September 30. The ministry has sought a direction to the company to deposit Rs 284.55 crore in the Consumer Welfare Fund for defective and hazardous goods sold and unfair trade practice.

"This commission be pleased to direct the opponent company to deposit in the Consumer Welfare Fund Rs 355.40 crore as punitive damages," the Centre had said in its complaint before the Commission. It also sought an interest of 18 per cent per annum on the amount claimed by it in the complaint till the date of actual payment of the total amount.