2003 (2) TMI 488 - HC - Companies Law

Summary

Issues Involved:
1. Applicability of the Standards of Weights and Measures Act, 1976, and the Standards of Weights and Measures (Packaged Commodities) Rules, 1977, to vacuum cleaners.
2. Legality of the seizure of vacuum cleaners by the Senior Inspector, Legal Metrology.
3. Interpretation of "commodity in packaged form" and related terms under the Act and Rules.

Summary:

1. Applicability of the Act and Rules to Vacuum Cleaners:
The petitioner, a company engaged in manufacturing and marketing vacuum cleaners, contended that the Standards of Weights and Measures Act, 1976 (the Act), and the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 (the Rules), do not apply to vacuum cleaners. The vacuum cleaners are sold as single pieces and not by weight, measure, or number. They are placed in cartons for protection during transportation and storage, which do not qualify as "packages" under the Act and Rules. The respondents argued that the vacuum cleaners, along with their accessories, are pre-packaged commodities as defined in Rule 2(1) of the Rules and thus subject to the Act and Rules.

2. Legality of the Seizure:
The Senior Inspector, Legal Metrology, seized five boxes containing vacuum cleaners from the petitioner's premises, alleging a violation of Section 39 of the Act read with Rules 23(6) and 23(7). The petitioner received a notice indicating prosecution unless the offense was compounded u/s 73 of the Act. The petitioner argued that the Act and Rules do not apply to their products and sought a declaration to that effect.

3. Interpretation of "Commodity in Packaged Form":
The court examined the definitions and provisions under the Act and Rules. Section 2(b) of the Act defines "commodity in packaged form" as a commodity packaged in units suitable for sale. Section 39 mandates labeling requirements for such commodities. Rule 2(1) of the Rules defines "pre-packed commodity" and includes commodities packed without the purchaser being present, with a predetermined quantity. The court noted that the Act and Rules apply to commodities intended to be sold in packaged form and not to all products sold in non-packaged form.

Judgment:
The court concluded that vacuum cleaners sold by the petitioner are not "pre-packed commodities" or "commodities in packaged form" as defined under the Act and Rules. The vacuum cleaners are sold as single pieces, and the packaging is for protection during transit and storage, not for sale. The court referred to previous judgments, including those of the Madras High Court and this Court, which supported this view. The court held that the seizure of vacuum cleaners was unjustified and allowed the writ petition, declaring that the Act and Rules do not apply to the petitioner's vacuum cleaners. The writ petition was allowed without any order as to costs.