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2006 (7) TMI 659 - HC - Companies Law

Issues Involved:
1. Applicability of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 to the petitioner's products.
2. Definition and interpretation of "pre-packed commodity" under the Act and the Rules.
3. Validity of the seizure of watches by the respondents.
4. Compliance with previous court orders regarding notice and hearing.

Issue-Wise Detailed Analysis:

1. Applicability of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 to the petitioner's products:
The petitioner, a company manufacturing and selling watches, challenged the respondents' seizure of their watches for allegedly violating the Standards of Weights and Measures (Packaged Commodities) Rules, 1977. The respondents contended that the petitioner's products were subject to these Rules. The petitioners argued that their watches are sold individually, often inspected and handled by customers before purchase, and thus do not fall under the definition of "pre-packed commodity".

2. Definition and interpretation of "pre-packed commodity" under the Act and the Rules:
The court examined the definition of "pre-packed commodity" under Rule 2(1) of the Rules, which states that a commodity is pre-packed if it is placed in a package without the purchaser being present, has a pre-determined value that cannot be altered without opening the package or undergoing a perceptible modification. The court emphasized that the package must be suitable for sale, either wholesale or retail, and that the commodity should undergo a change in value or modification upon opening.

3. Validity of the seizure of watches by the respondents:
The court referred to a previous case (Subhash Arjandas Kataria v. State of Maharashtra) where it was held that sun glasses, even if packaged, were not considered pre-packed commodities as their value did not change upon opening the package. Applying this reasoning, the court concluded that the petitioner's watches, which are displayed and handled by customers before purchase, do not qualify as pre-packed commodities. The court noted that the watches do not undergo any perceptible change or decrease in value when removed from their packaging, which is primarily for protection during transportation and storage.

4. Compliance with previous court orders regarding notice and hearing:
The court reviewed the procedural history, including a previous writ petition where the respondents were directed to give notice and hear the petitioners before taking any action. The petitioners argued that the respondents violated this order by conducting search operations and forcing them to sign an undertaking. The court found that the respondents' actions were not in compliance with the previous court order, which required a proper notice and hearing process.

Conclusion:
The court held that the petitioner's watches are not pre-packed commodities under the Standards of Weights and Measures (Packaged Commodities) Rules, 1977. Consequently, the seizure of the watches by the respondents was deemed unlawful. The petition was allowed, and the respondents were restrained from taking any further action against the petitioners based on the impugned seizure. The court granted the petition in terms of prayer Clauses (a) and (b), with no order as to costs.

 

 

 

 

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