{"id":37344,"date":"2010-10-19T00:00:00","date_gmt":"2010-10-18T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/ms-raj-products-vs-state-govt-of-nct-of-delhi-anr-on-19-october-2010"},"modified":"2019-04-02T11:41:04","modified_gmt":"2019-04-02T06:11:04","slug":"ms-raj-products-vs-state-govt-of-nct-of-delhi-anr-on-19-october-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/ms-raj-products-vs-state-govt-of-nct-of-delhi-anr-on-19-october-2010","title":{"rendered":"M\/S Raj Products vs State (Govt Of Nct Of Delhi) &amp; Anr on 19 October, 2010"},"content":{"rendered":"<div class=\"docsource_main\">Delhi High Court<\/div>\n<div class=\"doc_title\">M\/S Raj Products vs State (Govt Of Nct Of Delhi) &amp; Anr on 19 October, 2010<\/div>\n<div class=\"doc_author\">Author: Mool Chand Garg<\/div>\n<pre>*                IN THE HIGH COURT OF DELHI AT NEW DELHI\n\n+                             FAO No.61\/2010\n\n%                      Date of Decision: 19.10.2010\n\nM\/s Raj Products                                        .... Appellant\n\n                        Through Mr.Deepak Gandhi      and   Mr.Abhas\n                                Kumar, Advocates\n\n                                 Versus\n\nState (Govt. of NCT of Delhi) and Anr.                .... Respondents\n\n                        Through Mr.A.S.Chandhiok, ASG with\n                                Mr.S.C.Aggarwala and Ms.Vibha\n                                Diwan, Advocates for R-2.\nCORAM:\nHON'BLE MR. JUSTICE MOOL CHAND GARG\n\n1.    Whether reporters of Local papers may be\n      allowed to see the judgment?\n2.    To be referred to the reporter or not?\n3.    Whether the judgment should be reported in\n      the Digest?\n\nMOOL CHAND GARG, J. (ORAL)\n<\/pre>\n<p>*<br \/>\nCM No. 3418\/2010 (Exemption)<br \/>\n       Allowed subject to just exceptions.\n<\/p>\n<p>       Application stands disposed of.\n<\/p>\n<p>FAO No. 61\/2010\n<\/p>\n<p>1.     M\/s Raj Products has filed this appeal under Order 43 of the<br \/>\nCode of Civil Procedure (for short \u201eCPC\u201f) r\/w Section 151 CPC        and<br \/>\nSection 19 of the Cigarettes and other Tobacco Products (Prohibition<br \/>\nof Advertisement and Regulation of Trade and Commerce, Product<br \/>\nSupply and Distribution) Act, 2003 (hereinafter referred to as &#8220;the<br \/>\nCOTP Act&#8221;) aggrieved of the order dated 18.1.2010 passed by the<br \/>\nlearned Additional District Judge, Dwarka Courts, New Delhi in Suit<br \/>\nNo.34\/2009, whereby the learned Additional District Judge has<br \/>\nallowed the suit filed by the respondent and has given the following<br \/>\ndirections:-\n<\/p>\n<p><span class=\"hidden_text\">FAO No.61\/2010                                              Page 1 of 6<\/span><\/p>\n<blockquote><p>        &#8220;36. Resultantly it is ordered that the petitioner is entitled to<br \/>\n       confiscate the seized gutkha pouches as the respondent has<br \/>\n       admitted that the same were not in conformity with Rule 3(1) (b)<br \/>\n       of the COTP (Packaging and labeling) Rules 2008. However, in<br \/>\n       view of Section 15 of the Act, respondent is given an option to<br \/>\n       pay in lieu of confiscation, costs equal to the value of goods<br \/>\n       confiscated. In case the respondent exercises such an option<br \/>\n       within 15 days and pays the costs to the petitioner equal to the<br \/>\n       value of the goods, the Superdginama given by respondent will<br \/>\n       be cancelled and respondent would be entitled to make<br \/>\n       distribution, sale or supply of such packages after getting the<br \/>\n       specified health warning incorporated on each package.\n<\/p><\/blockquote>\n<blockquote><p>       37.   The petition is therefore allowed.       Let the file be<br \/>\n       consigned to record room.&#8221;\n<\/p><\/blockquote>\n<p>2.     Before the Additional District Judge it was the claim of the<br \/>\nrespondent that the officers of Central Excise Department headed by<br \/>\nthe Superintendent, Shri Narender Pal, visited the factory premises of<br \/>\nthe appellant and examined the finished goods and packing material<br \/>\nused for making gutkha pouches lying stored in the factory premises.\n<\/p>\n<p>3.     It was claimed that the specified health warning did not occupy<br \/>\n40% of the principal display area of the front panel of the pouches,<br \/>\nwhich were taken into possession by the respondent during the raid<br \/>\nconducted at the premises of the appellant, which is required under<br \/>\nclause (b) of sub rule (1) of Rule 3 of the COTP Act             as per the<br \/>\namended notification dated 30.05.2009 [G.S.R. 305(E)] issued by the<br \/>\nMinistry of Health and Family Welfare vide F.No.16011\/07\/2005-PH.\n<\/p>\n<p>4.     It was the case of the respondent that since the finished goods<br \/>\nin the form of gutkha pouches as well as plastic material used for<br \/>\ngutkha pouches lying with the appellant were not displaying specified<br \/>\nhealth warning occupying 40% of the principal display area of the<br \/>\nfront panel of the pouches in violation of Rule 3 (a) of the said Rules,<br \/>\nthe goods were seized under Section 13 of COTP Act. The respondent<br \/>\nconsequently prayed for confiscation of the goods under Section 14 of<br \/>\nthe COTP Act.\n<\/p>\n<p>5.     The appellant who contested the proceedings before the<br \/>\nAdditional District Judge took a plea that it was not a case where<\/p>\n<p><span class=\"hidden_text\">FAO No.61\/2010                                                    Page 2 of 6<\/span><br \/>\n statutory warning did not exist on the pouches\/packages seized by<br \/>\nthe respondent, but the warning existed on the packages as per Rules<br \/>\nprevalent at that time. The new amendment of Rules came into force<br \/>\ntwo-three months before the seizure.        The appellant was always<br \/>\nfollowing the Rules. Therefore, the appellant has not committed any<br \/>\nAct of violation of the aforesaid Act and Rule.\n<\/p>\n<p>6.     However, the submissions made by the appellant were not<br \/>\nfound favour with the Additional District Judge who held that the COPT<br \/>\n(Packaging and labeling) Rules 2008 came into force with effect from<br \/>\n31.05.2009 after their publication in the official gazette. The Trade<br \/>\nNotice is internal communication and has no statutory force. Trade<br \/>\nnotice is not mandatory. The department is under no obligation to<br \/>\nsend the Trade Notices and no excuse can be taken by a<br \/>\nmanufacturer that violation of law between the date of coming into<br \/>\nforce of Rules and intimation of Trade Notice is to be condoned. The<br \/>\nappellant is in the trade of manufacturing tobacco products and<br \/>\ncannot take a defence that the Rules which were published in the<br \/>\ngazette on 03.05.2009 and came into force on 31.05.2009 were<br \/>\nunknown to him till 22.09.2009 when the officials of the respondent<br \/>\nsearched his factory and seized the offending goods. Therefore, the<br \/>\nobjection of the appellant that the goods be not confiscated as these<br \/>\nwere seized by the department prior to intimation of Trade Notice to<br \/>\nthe appellant is rejected.\n<\/p>\n<p>7.     Another objection raised by the appellant is that since it was<br \/>\nnot a case of sale as per Section 14 of the Act, the prohibition was not<br \/>\napplicable to the product in question as the product was not being<br \/>\nsold and was in the process of being prepared for making it saleable<br \/>\nin the market. It was argued that the seized material was not for sale<br \/>\nbut was in the process of replacing\/refilling in new packages.        The<br \/>\nappellant submits that after the enforcement of amended Rules 2009<br \/>\nwhich came into force on 31.05.2009 vide notification dated<br \/>\n03.05.2009, the appellant withheld its earlier stock packed in all<br \/>\npackages, thereafter, its products were packed in new packages<\/p>\n<p><span class=\"hidden_text\">FAO No.61\/2010                                                Page 3 of 6<\/span><br \/>\n which were got prepared as per the amended Rules 2009 containing<br \/>\nthe statutory and specified health warning on more than 40% of the<br \/>\nprincipal display area.\n<\/p>\n<p>8.     However, this argument was not found favour with the<br \/>\nAdditional District Judge, who has taken note of the panchnama dated<br \/>\n22.09.2009 (Annexure A to the seizure memo) which is also filed<br \/>\nbefore this Court as Annexure 10 along with the present petition. It<br \/>\nshows that 10980 packets of \u201eKareena\u201f Gutkha pouch (each packet<br \/>\ncontains 75 pouches of MRP ` 0.50), 117096 packets of \u201eRangeela\u201f<br \/>\nGutkha pouches (each packet contains 60 pouches of `1.00 MRP) and<br \/>\n10980 packets of \u201eRangeela\u201f gutkha pouch of MRP `1.00 were seized<br \/>\nby the respondent. There can be no doubt that the same were meant<br \/>\nfor sale and nothing else.\n<\/p>\n<p>9.     It will also be appropriate to take note of paragraph 31 of the<br \/>\nimpugned order passed by the Additional District Judge:-\n<\/p>\n<blockquote><p>       &#8220;31. Moreover, the argument of respondent that the seized<br \/>\n       material was not for the purposes of sale is clearly an after-<br \/>\n       thought in view of the main defence of the respondent that<br \/>\n       the respondent was not even aware of change in Rules<br \/>\n       brought in force on 31.05.2009 as the trade notice was<br \/>\n       received by him on 05.11.2009. If the respondent was not<br \/>\n       even aware of new Rules that came into force on 31.05.2009<br \/>\n       till 5.11.2009, it is not possible that on the date of search on<br \/>\n       22.09.2009 the respondent was in the process of refilling the<br \/>\n       old pouches in new pouches which were conforming with the<br \/>\n       Rules brought in force with effect from 31.05.2009.<br \/>\n       Therefore, the objection of the respondent that the goods<br \/>\n       were not for sale is also rejected.&#8221;\n<\/p><\/blockquote>\n<p>10.    I have heard the arguments made on behalf of learned counsel<br \/>\nfor the appellant.        Before me, the appellant has confined his<br \/>\narguments to the effect that the product seized by the respondent<br \/>\nwas not meant for sale. However, in this regard, it would be<br \/>\nappropriate to take note of some of the provisions of COPT Act, which<br \/>\nreads as under:-\n<\/p>\n<blockquote><p>       &#8220;12. Power of entry and search.-(1) Any police officer, not<br \/>\n       below the rank of a sub-inspector or any officer of State Food<br \/>\n       or Drug Administration or any other officer, holding the<br \/>\n       equivalent rank being not below the rank of Sub-Inspector of<br \/>\n       Police, authorised by the Central Government or by the State<\/p>\n<p><span class=\"hidden_text\">FAO No.61\/2010                                                      Page 4 of 6<\/span><br \/>\n        Government may, if he has any reason to suspect that any<br \/>\n       provision of this Act has been, or is being, contravened, enter<br \/>\n       and search in the manner prescribed, at any reasonable<br \/>\n       time, any factory, building, business premises or any other<br \/>\n       place,-\n<\/p><\/blockquote>\n<blockquote><p>       (a) where any trade or commerce in cigarettes or any other<br \/>\n       tobacco products is carried on or cigarettes or any other<br \/>\n       tobacco products are produced, supplied or distributed; or\n<\/p><\/blockquote>\n<blockquote><p>       (b) where any advertisement of the cigarettes or any other<br \/>\n       tobacco products has been or is being made.<br \/>\n       (2) The provisions of the Code of Criminal Procedure, 1973 (2<br \/>\n       of 1974), shall apply to every search and seizure made under<br \/>\n       this Act.\n<\/p><\/blockquote>\n<blockquote><p>       13. Power to seize.-(1) If any police officer, not below the<br \/>\n       rank of a sub-inspector or any officer of State Food or Drug<br \/>\n       Administration or any other officer, holding the equivalent<br \/>\n       rank being not below the rank of Sub-Inspector of Police,<br \/>\n       authorised by the Central Government or by the State<br \/>\n       Government, has any reason to believe that,-\n<\/p><\/blockquote>\n<blockquote><p>       (a) in respect of any package of cigarettes or any other<br \/>\n       tobacco products, or\n<\/p><\/blockquote>\n<blockquote><p>       (b) in respect of any advertisement of cigarettes or any other<br \/>\n       tobacco products, the provisions of this Act have been, or are<br \/>\n       being, contravened, he may seize such package or<br \/>\n       advertisement material in the manner prescribed.<br \/>\n       (2) No package of cigarettes or any other tobacco products or<br \/>\n       advertisement material seized under clause (a) of sub-<br \/>\n       section (1) shall be retained by the officer who seized the<br \/>\n       package or advertisement material for a period exceeding<br \/>\n       ninety days from the date of the seizure unless the approval<br \/>\n       of the District Judge, within the local limits of whose<br \/>\n       jurisdiction such seizure was made, has been obtained for<br \/>\n       such retention.\n<\/p><\/blockquote>\n<blockquote><p>       14. Confiscation of Package:-Any package of cigarettes or<br \/>\n       any other tobacco products or any advertisement material of<br \/>\n       cigarettes or any other tobacco products, in respect of which<br \/>\n       any provision of this Act has been or is being contravened,<br \/>\n       shall be liable to be confiscated.\n<\/p><\/blockquote>\n<blockquote><p>               Provided that, where it is established to the<br \/>\n       satisfaction of the court adjudging the confiscation that the<br \/>\n       person in whose possession, power or control any such<br \/>\n       package of cigarettes or any other tobacco products is found<br \/>\n       is not responsible for the contravention of the provisions of<br \/>\n       this Act, the Court may, instead of making an order for the<br \/>\n       confiscation of such package, make such other order<br \/>\n       authorized by this Act against the person guilty of the breach<br \/>\n       of the provisions of this Act as it may think fit.&#8221;\n<\/p><\/blockquote>\n<p><span class=\"hidden_text\">FAO No.61\/2010                                                     Page 5 of 6<\/span><\/p>\n<p> 11.    In fact to prove this aspect, no evidence has been led by the<br \/>\nappellant despite opportunity granted to them.\n<\/p>\n<p>12.    The learned counsel for the appellant also submitted that in the<br \/>\nimpugned order the Additional District Judge has also included the<br \/>\nfinished Gutkha product in the definition of the products, which is<br \/>\ncompletely wrong.      However, this argument is of no consequence<br \/>\nbecause Section 17 deals with the power of confiscation, which as<br \/>\nstated above, empowers confiscation of any package of cigarette or<br \/>\nany other tobacco product or any other product in respect of which<br \/>\nany provision of this Act is being contravened.\n<\/p>\n<p>13.    In the present case, there was a necessity to display the<br \/>\nstatutory warning in an area equivalent to 40% of the pre-display<br \/>\narea of the front panel of the pouches in terms of the amended<br \/>\nnotification dated 30.05.009, which admittedly has not been done. As<br \/>\nper the panchnama, it is very clear that the pouches which have been<br \/>\nseized were containing tobacco with label as that of \u201eRangeela\u201f<br \/>\nGutkha, \u201ePanmasala\u201f Gutkha and thus, in the absence of necessary<br \/>\nstatutory warning, were liable for confiscation. It is a matter of record<br \/>\nthat no evidence has been led on the file by the appellants that the<br \/>\ngoods seized were in the process of replacing\/refilling in new<br \/>\npackages and thus were not ready for sale.\n<\/p>\n<p>14.    As the learned counsel for the appellant has not argued with<br \/>\nregard to the applicability of the notification, which admittedly is<br \/>\ndated 30.05.2009 and there is no other issue which requires<br \/>\nadjudication by this Court, the appeal filed by the appellant is<br \/>\ndismissed with no orders as to costs.     Trial court record, if any, be<br \/>\nsent back forthwith.\n<\/p>\n<p>CM No. 3417\/2010 (stay)<br \/>\n       Dismissed as infructuous.\n<\/p>\n<p>                                            MOOL CHAND GARG, J.\n<\/p>\n<p>OCTOBER 19, 2010<br \/>\ndc<\/p>\n<p><span class=\"hidden_text\">FAO No.61\/2010                                                 Page 6 of 6<\/span>\n <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Delhi High Court M\/S Raj Products vs State (Govt Of Nct Of Delhi) &amp; Anr on 19 October, 2010 Author: Mool Chand Garg * IN THE HIGH COURT OF DELHI AT NEW DELHI + FAO No.61\/2010 % Date of Decision: 19.10.2010 M\/s Raj Products &#8230;. Appellant Through Mr.Deepak Gandhi and Mr.Abhas Kumar, Advocates Versus State [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[14,8],"tags":[],"class_list":["post-37344","post","type-post","status-publish","format-standard","hentry","category-delhi-high-court","category-high-court"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>M\/S Raj Products vs State (Govt Of Nct Of Delhi) &amp; Anr on 19 October, 2010 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/ms-raj-products-vs-state-govt-of-nct-of-delhi-anr-on-19-october-2010\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"M\/S Raj Products vs State (Govt Of Nct Of Delhi) &amp; 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