Pepsico India Holdings Limited Vs State of Maharashtra On 23 December, 2010

Pepsico India Holdings Limited vs State Of Maharashtra on 23 December, 2010
Bench: D D Chandrachud
upa wp3998-10-final.sxw
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.3998 OF 2010
PepsiCo India Holdings Limited, ) A company duly incorporated under the ) Companies Act, 1956, having its
) registered office at 3-B, DLF, Corporate Park, ) "S" Block, Qutub Enclave, Phase-III, Gurgaon and ) having
its one of the Plants at Plot No.5, Ranjangaon, ) MIDC, Taluka-Shirur, District-Pune, through its ) Authorised
representative and Finance Manager ) Shri Mayank Jaju, having his office at ) Xcellency Chamber,
Sion-Trombay Road, ) Bombay- 400 088. ).. Petitioner
Versus
1. State of Maharashtra, ) through the Secretary, Food and Drug ) Admiinstration, Consumer Protection
Department, ) Mantralaya, Mumbai - 400 032. )
2. The Commissioner, Food and Drug ) Administration, Maharashtra, having his ) Office at Bandra-Kurla
Complex, ) Bandra (E), Mumbai- 400 051. ).. Respondents
Mr. Janak Dwarkadas, Senior Advocate with Mr. Rajeev V. Talasikar for the petitioner.
Mr. S.N. Patil, Assistant Government Pleader for respondent Nos.1 and 2.
CORAM : MOHIT S. SHAH, C. J. AND
DR. D.Y. CHANDRACHUD, J.
JUDGMENT RESERVED ON : 01 OCTOBER 2010
JUDGMENT PRONOUNCED ON : 23 DECEMBER 2010
JUDGMENT (Per Chief Justice)
What is challenged in this petition under Article 226 of the Constitution of India is the order dated 17 April
2010 of the Food (Health) Officer & Commissioner, Food & Drug Administration (Maharashtra State),
Mumbai, dismissing Appeal No.14/2009 and confirming the order dated 11 June 2009 of the Licensing
Officer & Officer (Food) Food & Drug Administration, Pune, suspending the license of the petitioner-factory
for a period of two days. The license was issued under Rule 5 of the Maharashtra Prevention of Food
Adulteration Rules, 1962. During pendency of this writ petition, the said orders of the authorities were stayed.
2. By consent of the parties, petition was taken up for final disposal.

Indian Kanoon - http://indiankanoon.org/doc/151110/ 1
3. The facts leading to filing of this writ petition, briefly stated, are as under:
One complaint was received by the office of Food Inspector, Pune on 7 October 2008 regarding infection of
larves in "oats Break Fast special" manufactured by the petitioner. The Food Inspector, Pune inspected the
petitioner-factory on 8 October 2008 and 12 May 2009. On the basis of inspection reports of the above dates,
the Licensing Authority, Pune sent a show cause notice to the petitioner on 15 May 3
2009 at Exhibit `B'. The petitioner submitted its explanation dated 1 June 2009 at Exhibit `C'. By order dated
11 June 2009 at Exhibit `D', the Licensing Officer suspended the petitioner's license for two days.
4. For the sake of convenience, we have given the allegations in the show-cause notice, the explanation in the
reply and finding given by the Licensing Officer item wise.
5. Allegation -A : Use of raw materials beyond "Best Before" date: Spinach powder Manufacturer- Sensienf
Production date 14.08.08, Best buy Feb.2009, stock 52 nos. The said food product is stored for production
even after expiry of Best buy date. It was observed that you have used for production the raw food items
which are out of date. You have not confirmed by taking test of said food items whether it is proper to eat out
of date food product. Hence you have violated Rule 32(i) of the Prevention of Food Adulteration Rules, 1955
(hereinafter referred to as "PFA Rules, 1955)
Besan Manu. Rajdhani Flour Mill Ltd., Delhi, 35 Kg. Packing Mfg. Date : 03.03.09, Best before 60 days,
Stock 77 nos. It is observed that this out of date raw food item is used for production by you. You have not
confirmed by taking test of said food item whether it is proper to eat such out of date food product or how.
Hence you have violated Rule 32(i) of PFA Rules, 1955.
Out of date stock of food item like (i) Kesar flavour (ii) Strawberry flavour was observed at the time of
inspection on 8.10.2008. 4
Explanation : For materials Spinach powder and Besan, the suppliers have specified shelf life as 6 months and
3 months respectively. On the basis of the nature of the product and processing, the R&D department which
technically controls quality of the product, has defined the shelf life as 1 year and 4 months respectively.
Hence as recommended by you, in future usage, validation for best before date materials will be validated by
respective suppliers only and we have already started the process. In addition we are in the process of having
single shelf life as recommended by suppliers in our internal system.
The supplier validated shelf life for best before materials certificate was also furnished with the reply.
Finding given by the Licensing Officer : It has been observed that Spinach powder manufactured by Sensient
with manufacturing date 14.08.08 and "Best Before by Feb 09" has been used for manufacturing. You have
not done any testing to find out whether it is good for consumption. Because of that you have violated Rule
32(i) under the PFA Rules, 1955.
It has been observed as regards material Besan, manufacturer, Rajdhani Flour Mills Ltd., Delhi, product date
03.03.09 "Best Before 60 days", that the said raw material has been used by you even after the expiry date.
You have not carried out any testing to prove whether the said item is good for consumption. It is a violation
of Rule 32(i) under PFA Rules, 1955.
5
6. Allegation B - Absence of manufacturing details on fiber plus pack : Fiber Plus WF 600, 20 Kg. Bag : on
this raw food item the name of manufacturer and address is not mentioned on the packing. Hence there is
violation of Rule 32(i) of PFA Rules, 1955 and you have stored this food item for production.
Explanation : Fiber pulp- WF 600, 20 Kg is an imported item from Australia. We have received a
confirmatory note from our principal supplier and importer for all the manufacturing details. However, we
have highlighted this issue to our principal supplier at Australia and it has been agreed the future supply will
carry the manufacturing details on all individual bags.
Finding given by the Licensing Officer : It has been observed that the name and address of the manufacturer is
not mentioned on the raw material, Fiber plus WF 600, 20 Kg bags. It is a violation of rule 32(c) under food
adulteration administration. For the same the explanation given by you is not satisfactory.
7. Allegation C : Century Refined Table iodized Salt Mfg. Date 6/08, 50 Kg bags stock 120 bags on which
"Best Before date" not mentioned. Hence violated Rule 32(i) of PFA Rules, 1955 by storing raw food items
for production of food items by you.
Explanation : The reference to Rule 32(i) is misplaced and is not maintainable. The package iodized salt
shown to the visiting 6
officials did contain the declaration of "best before". The package will be shown during the hearing to the
satisfaction of this Ld. Authority.
Finding given by the Licensing Officer : It has been observed that best before date has not been mentioned on
raw material Centurian refined iodized salt, product date 06.08 of 60 kg and 120 kg bags. This is the violation
of Rule 32(i). The explanation given by you is not satisfactory.
8. Allegation D - Non availability of Food Grade Certificate for GMS (Glycerol Mono Stearate) : GMS
(Glycol mono separate) this item is stored, this items is used in the product of Baked Corn. There is no
permission to use said item in Baked Corn Product. Hence you have violated Section 2(1a)(a), 2(in)(m) of
PFA Act, 1954; also made violation of Rule 81.
Explanation : The said material is used as a lubricant for extruder start up process and not as an ingredient of
the product. We have already taken up with the vendor and the required food grade certificates are available
with us now.
Along with the reply, Food Grade Certificate for Glycerol Mono Stearate was also supplied.
Finding given by the Licensing Officer : It has been observed that you are using GMS (Glycerol mono
stearate) in your baked corn products. You are not authorized to use the said material in baked corn products.
You have violated section 2(1a)(a), 2(ia)(m) and Rule 81. 7
9. Allegation E - Manufacturing Area : In the production department, the tiles are broken in between, where
food particles are kept. Therefore you have violated Rule 5(3) of Maharashtra Prevention of Food
Adulteration Rules, 1962, read with License condition No.4 B.

In the Production Department unclean tiles in between, in which stored on some times. Therefore you have
violated Rule 5(3) of Maharashtra Food Adulteration Prevention Rule 1962, read License condition No.4 B.
Explanation : 1. Repairing of broken tiles: We do have regular maintenance system for carrying out the repair
work of building structures. The broken and damaged tiles are periodically replaced or repaired. The places
identified are already replaced and in future we will plan it in our regular maintenance system and as ongoing
activity.
2. During inspection the lines were under cleaning process as a part of sanitation, hence dirt accumulation was
observed during the visit. For effective cleaning we have provided high pressure jet cleaning machines and the
actions are being taken for minimizing the product spillages during production. Post sanitation line will be
audited by Quality Control Department and will be cleared for production.
Finding given by the Licensing Officer : It has been observed that some tiles are in broken condition in
manufacturing area 8
and food items have been accumulated in it. It is a violation of rule no. 5(3) and permission condition 4(b).
10. Allegation F - Workers medically not checked: There are Contract Labours for handling food items in the
production department, but not medical checking of said labours. Not produced certificate regarding labours
whether they are free from skin & contagious disease & how, hence your have violated Rule 50(9) of Food
Adulteration Prevention Rule, 1955.
Explanation : We do have medical records for contract work force for packaging area. We do conduct medical
test for contract employees on every year. However, some people change due to non availability/ absenteeism.
Hence, in future we will place only medically examined contract labourers in food handling area and the
medical examination of the current contract employees will be completed by June 09 end.
The petitioner also enclosed with the reply, sample medical examination report of contract employee.
Finding given by the Licensing Officer : It has been observed that you have not carried out medical
examination with respect to contractual labours. This is the violation of rule no.50(9) under food adulteration
administration.
11, Allegation G - Packaging Area not clean : Plastic wrapper and food particles fallen on tiles in the Packing
Department. Hence you have violated Rule 5(3) read with License condition No.4 C of Maharashtra Food
Adulteration Prevention Rule 1962.
Explanation : During inspection the packaging area was under cleaning process as a part of sanitation
programme, hence the observation on fallen plastic wrappers and food particles on floor. The same was
cleaned as a part of sanitation operation. During regular runs, the area will be clean and the production will be
continued post clearance of line audit by Quality Control Department.
Finding given by the Licensing Officer : It has been observed that plastic covers (packaging film) and food
items have been spilled on floor. This is violation of rule no.5(3) under food adulteration administration and
manufacturing permission condition 4(c).
12. Allegation H - Plastic Wrappers : Not produced the certificate regarding Plastic wrapper used for food
packing whether these are good graded or how to Inspector. Hence you have violated Rule 49(v) of Food
Adulteration Prevention Rule 1955. 10
Explanation : We do have vendor development system for supplying materials to us. Materials will be
procured only from approved vendors by Corporate purchase department. We do take food grade certificate
from packaging materials suppliers during first supply (the food grade certificate from film supplier M/s.
Positive Packaging was shown to you during the visit). However as per your recommendation, in future we
will get the same on yearly basis. We have already contacted our suppliers to issue a fresh food grade
certificates which is expected in a week's time.
Finding given by the Licensing Officer : During the inspection the food grade certificate of packaging
material was not presented and the certificate presented afterwards, is not clear. So you have violated rule
49(5) of food adulteration administration.
13. Aggrieved by the above order dated 11 June 2009, the petitioner preferred appeal before the
Commissioner, Food and Drug Administration, Maharashtra State, Mumbai contending that the petitioner has
been operating the license for manufacturing of potato chips and other food products in the manufacturing
facility which is a state of the art facility accorded safety certification and environmental certification as per
the certificate enclosed. That the total annual turn over of the facility within Maharashtra was exceeding Rs.90
crores and that the petitioner was contributing through this facility local taxes to the tune of Rs.9 crores or
more per year, that the facility provides average daily employment to 335 regular employees and about 580
contract 11
workmen and that the plant also provides indirect employment to associated services for about 500 people and
there are about 3600 farmers who are involved in the contract farming activity initiated by the petitioner
through who grow potatoes for consumption by the petitioner in manufacturing of the products. The petitioner
raised various legal contentions and factual defences. The appellate authority, however, dismissed the appeal
by the impugned order dated 17 April 2010. Hence this petition.
14. Mr. Janak Dwarkadas, learned Senior counsel for the petitioner raised the following contentions:
The authorities have erred in passing the impugned orders on the ground of violation of Rule 30(i) and Rule
32(i) of the Prevention of Food Adulteration Rules, 1955. He submitted that respondent-authorities erred in
not considering the scope and ambit of explanation VII (i) to Rule 32 defining "best before". The authorities
erred in not considering that "best before" date is not akin to expiry date and that the product beyond the "best
before" date may still be perfectly satisfactory. The petitioner had produced at the hearing of the appeal
various certificates issued by the vendors/suppliers of respective produces confirming the above aspect. This
fact was also informed to the visiting officials during the course of inspection. For instance, the specification
sheet dated 28 April 2009 (Exhibit `G' at page 38 of the petition) indicated the certificate dated 2 January
2009 read as under: 12
"Date : 02-01-2009
TO WHOMSOEVER IT MAY CONCERN

Sub : Shelf life extension.
Produce : 1327 Spinach Powder Lot No. : 264151
Manufacturing Date : 19th August, 2008
The Best before of 6 months from date of manufacture provided for Spinach Powder was conservative. This
material is well acceptable in terms of quality attributes and safe and fit for human consumption 12 months
from its date of manufacture when stored in original sealed packs at ambient conditions.
Sensient India Private Limited"
15. It is submitted by the learned counsel for the petitioner that Spinach Powder in question was manufactured
on 19 August 2008 and that six months "best before" period came to an end on 19 February 2009 but as
mentioned in the certificate, the material was fit for human consumption for 12 months from the date of its
manufacture when stored in original sealed packs at ambient conditions and was, thus, safe and fit for human
consumption till 19 August 2009. Hence, when the material was used on the date of inspection i.e. on 12 May
2009, it was well within the safe and fit period and also shelf life product of potato chips made for spinach
powder used on 12 May 2009 which was given three months best before period was also within the safe and
fit period. In other words, the potato chips made was safe and fit for human consumption till 19 August 2009.
The respondent-authorities, therefore, 13
erred in holding that the petitioner had violated rule 30(i) of the Rules. The learned counsel placed strong
reliance on the decision of the learned Single Judge of Andhra Pradesh High Court in Hyderabad Breverages
Pvt.Ltd. v. State of Andhra Pradesh, 2006 Cri.L.J. 3988, in support of the respondent-authorities who erred in
suspending the petitioner's license under the Prevention of Food Adulteration Act, 1954 without sending any
sample of the raw material (spinach powder/Besan or all the finished product potato ships etc.) for analysis to
the Central Food Laboratory. Without getting any such analysis done by the Central Food Laboratory, it is not
open to the respondents to hold or even to allege that without a certificate from such laboratory that the
sample has decomposed or that the sample is fit or unfit for analysis etc, the respondent authorities could not
have held that the petitioner had violated the provisions of rule 30 or rule 32 of the Prevention of Food
Adulteration Rules, 1955.
16. The learned counsel heavily relied upon the decision of the learned Single Judge of Andhra Pradesh High
Court in Hyderabad Breverages case (supra) in support of the contention that expiry of "best before" date or
shelf life of product would only enable the manufacturer to disclaim the liability regarding marketability and
the specific qualities of the product but it would not automatically render the sample unfit for analysis or
consumption.
17. The learned counsel further submitted that the authorities have erred in not considering the petitioner's
defence that in Turbo Extrusion machines, Glycerol Mono Stearate (GMS) is used as a 14
lubricant in a machine manufacturing certain food items and the petitioner relies on the certificate (Exhibit `I'
at page 42) issued by the supplier manufacturer of the machine Schaaf Technologies GmbH, a Germane
company which explains the important function of the schaaf knows for a successful start of a turbo extruder
machine used for making potato chips and other food items. The learned counsel further submitted that during
the course of hearing of the appeal, the appellate authority was also informed that tiles were replaced in the
manufacturing area and accordingly, necessary documents were also brought to his notice, for instance, the
check list reflecting maintenance in the process area, packaging area and raw material area and packaging
material dispatch area for May and June 2009.
18. The learned counsel further submitted that the petitioner is not employing any contract labour which is
suffering from any infectious, contagious or loathsome disease. The petitioner has an established protocol in
the factory to ensure health check up regularly as soon as the contract labour commences work from
established hospitals and/or registered medical practitioners. The contractual employees supplied by a
registered labour contractor are assigned work involving packaging etc. The petitioner-company and the
registered labour contractor execute a contract and the labour contractor is bound to supply the
petitioner-company fit workers. The petitioner had produced before the appellate authority a chart (Exhibit `K'
at page 70 of the petition) reflecting the medical check up of the workers. 15
19. The learned counsel further submitted that at the hearing of the appeal, the petitioner had also relied upon
the food grade certificate reflecting compliance to the respective standard regarding plastic packaging
material. The learned counsel further submitted that the visiting officials were shown that the package had a
proper sticker affixed to it indicating all the relevant details with reference to the commodities known as
"Fiber Plus" used by the petitioner in one of its products. The learned counsel also relied upon the certificate
dated 28.5.2009 issued by the supplier of Glycerol Mono Stearate (GMS) indicating that the said material is
manufactured from materials obtained from vegetable oil and that the product is food grain in nature.
20. On the other hand, the learned counsel for the respondent- authorities has opposed the petition and pointed
out that during the inspection, the Food Inspector had noticed all the illegalities / non- compliance of the
relevant statutory provisions and conditions of license at the time of inspection on 8 October 2008 as under:
"1. On the mezzanine floor 13 bags of quick oat's were stored which were imported from Australia, but did
not bear the name of importer & it's address, manufacturing date, batch no. and Best Before date.
2. On the said mezzanine floor, keshar masala flavour was found stored in 14 boxes on which manufacturing
date 01/2008 Best Before six months from manufacturing was found. The said food article was used after its
before date without pre-analysis.
3. On the platform & steps food articles were found. 16
4. In the packing section, the packing material was used which did not disclose the certificate to verify
whether the said packing material was of food grade quality or not."
21. The learned counsel for the respondents further submitted that even at the time of second visit on 12 May
2009, the Food Inspector noticed 52 bags of spinach powder bearing manufacturing date 14/8/2008 and best
before date February 2009 was being used after its "best before" date for the production of various food
articles without verification of pre-analysis. Similarly, 77 bags of 35 kg. each of Besan (Gram Flour) which
was manufactured on 3 March 2009 and which was to be used within a period of 60 days i.e. by 3 May 2009,
was being used after expiry of the best before period and without verification of pre-analysis.
22. It is also submitted that 20 kg. bags of fiber plus articles were found stored for use in manufacturing of
various food articles but the container did not mention name and address of the manufacturer, so also 120
bags of 50 kg. each of centurian refined iodized salt had manufacturing date of July 2008 but did not mention
the best before date. It was also submitted by the learned counsel for the respondent- authorities that at the
time of inspection, the flooring in manufacturing area was found unclean and dirt was found accumulated on
the tiles and that various food articles were handled by the contract labour without medical examination of all
those workers to assure that they were free from contagious diseases. The learned counsel for the respondent
authorities further submitted that the certificates relied upon by the petitioner at the hearing of the appeal were
not produced before the 17
Licensing Authority and that even after production of those certificates, the petitioner had not discharged the
onus to show that the petitioner had got verification of pre analysis of the raw material at the time of using the
same for manufacturing the food products after the expiry of its 'best before' period.
23. As regards the judgment of the learned Single Judge of Andhra Pradesh High Court, the learned counsel
for the respondents submitted that the said judgment does not bind this Court and that even otherwise, the
burden of proof on the licensing authority for the purpose of suspending the license cannot be as high as that
in criminal trial for proving the offence which would have the consequence of sending the manufacturer to
jail.
24. In rejoinder, the learned counsel for the petitioner submitted that the Andhra Pradesh High Court has
placed correct interpretation on explanation VII (i) to Rule 32 and that the interpretation of such a statutory
provision cannot vary depending on whether the licensee is facing a criminal trial or whether he is being
proceeded against for suspension of license. The learned counsel submitted that suspension of license is also a
penal measure and that license cannot be suspended unless all the ingredients of the Act constituting an
offence are fully satisfied.
25. While the learned counsel for the petitioner devoted considerable time for canvassing the interpretation on
explanation VII (i) to rule 32 of the Prevention of Food Adulteration Act, 1955 and we 18
would shortly deal with the same, it cannot be overlooked that the proceedings in question are for suspension
of a license under the Prevention of Food Adulteration Rules where mens rea is not required to be proved
unlike in an ordinary criminal trial. Even the statutes providing for criminal liability may dispense with the
proof for mens rea. Since the decision rendered by the learned Single Judge of Andhra Pradesh High Court
was in the proceedings for quashing the complaint, one must keep in mind that perspective while appreciating
the principles laid down in the said decision. In Hyderabad Beverages (supra), the learned Single Judge of
Andhra Pradesh High Court interpreted explanation VII (i) to Rule 32 in the following words:
"61. All that the prescription of "Best Before", under Rule 32(i) and Explanation VII thereunder entail is that,
till the end of the period "Best Before", the manufacturer certifies that the product will remain fully
marketable and will retain its specific qualities. This requirement is an additional precaution to consumers
informing them that it is safe for them to consume the food article before the "Best Before" date. Expiry of the
"Best Before" date, as is clear from Explanation VIII itself, does not mean that beyond that date the food is
not satisfactory. The only obligation cast on the manufacturer is to ensure that under the stated storage
conditions, the product retains its marketability and its specific qualities before the "Best Before" date. The
rules do not provide, by legal fiction, that after the "Best Before" date or the expiry of the shelf life of the
product, the food decomposes and is rendered unfit for analysis, or even that the food becomes adulterated. It
is not for Courts to read something more than what has specifically been provided in these statutory
provisions."
19
In the said decision, reliance was placed upon the decision of Andhra Pradesh High Court in Gangaiahnaidu
Rama Krishna v. State of A.P.. 2005 (2) ALD (Crl) 889, wherein the following observations were made:
" . Best before means that in all weathers it is to be used before six months. It is only recommendatory but not
mandatory. Therefore, it cannot be said that the shelf life of the said beverage expires after the date of best
before. Shelf life means the time for which a stored thing remains usable .."
" .. According to Rule 32(i) of the Rules read with Explanation VIII (i) best before means the date which
signifies the end of the period under any stated storage conditions during which the product will remain fully
marketable and will retain any specific qualities for which tacit or express claims have been made. However,
provided that beyond that date the food may still be perfectly satisfactory, which means the date before date
only signifies that the said food article contains specific qualities in all circumstances of any weather cold, dry
or rainy weather. Therefore, there is no prohibition for human consumption even after the best before, if that
be so, the only question that arises for consideration is as to whether the said food article is adulterated or not.
Without adducting any evidence and without availing the opportunity under Section 13(2) of the Act for
sending the second sample to the Central Food Laboratory it cannot be said that the shelf life of the said food
article has expired. The said rule prescribing best before is not mandatory to make use of the said food item
before the date of the best before, but it is only recommendatory or directory. The best before is only as
guaranteed period for carrying specific qualities in all weathers for that particular period. 20
Therefore, it cannot be said that the shelf life of the said beverages have been expired ."
..
"66. Whether the sample remains fit for analysis or has become unfit can only be ascertained when it is, in
fact, sent for analysis to Central Food Laboratory and it is certified as to whether the sample is fit or unfit for
analysis. Rule 4(5) of the Prevention of Food Adulteration Rules, read with Form II of Appendix A thereof,
requires the Central Food laboratory to certify, in its report, as to whether the sample of the food sent for
analysis is fit or unfit for analysis and the reasons therefore. Whether a sample has, on expiry of its "Best
Before" date or its shelf life, become unfit for analysis on account of its being decomposed is a matter of
evidence and not a matter of inference in proceedings under section 482 Cr.P.C. It is only when a sample is
sent for analysis, can the Central Laboratory on examination certify whether or not the sample has
decomposed rendering it unfit for analysis."
26. While interpretation placed by Andhra Pradesh High Court on the explanation VII(i) to Rule 32 cannot be
faulted with and therefore, though we hold that expiry of "best before" period does not mean that beyond that
date, the food can never be satisfactory, the question that arises for consideration is whether, for the purposes
of suspension of license, the burden is on the authority to show that beyond the best before period, the food is
unsatisfactory or that the burden is on the licensee to show that beyond the "best before" period, the food is
satisfactory. 21
27. Rule 32 of The Prevention of Food Adulteration Rules, 1955, in so far as the same is relevant for the
purposes of this petition, reads as under :-
"32. Every prepackaged food to carry a label.-
(a) General.-
(1) Prepackaged food shall not be described or presented on any label or in any labelling manner that is false,
misleading or deceptive or is likely to create an erroneous impression regarding its character in any respect.
(2) ... ... ...
(3) ... ... ...
(4) ... ... ...
(b) Labelling of prepackaged foods.- Every package of food shall carry the following information on the
label.-
(1) The name of the food.- The name of the food shall include trade name or description of food contained in
the package
(2) List of ingredients.- A list of ingredients shall be declared on the label and shall be in the following
manner :-
... ... ...
(c) ... ... ...
(d) ... ... ...
(e) ... ... ...
(f) Date of manufacture or packing.- The date, month and year in which the commodity is manufactured,
packed or pre-packed, shall be given on the label;
22
Provided that the month and the year of manufacture, packing or pre-packing shall be given if the "Best
Before Date" of the products is more than three months'
Provided further that in case any package contains commodity which has a short shelf life of less than three
months, the date, month and year in which the commodity is manufactured or prepared or pre-packed shall be
mentioned on the label.
(g) Use by date/recommended last consumption date/expiry date.- The use by date/recommended last
consumption date/expiry date shall be given,-
(i) in case of package of Aspertame, which shall be not more than three years from the date of packing;
(ii) in case of infant milk substitute and infant foods.
(h) ... ... ...
(i) The month and year in capital letters upto which the product is best for consumption, in the following
manner, namely :-

"BEST BEFORE ...... MONTH AND YEAR"
OR
"BEST BEFORE ...... MONTHS FROM
PACKAGING"
OR
"BEST BEFORE ...... MONTHS FROM
MANUFACTURE"
(j) ... ... ...
(k) ... ... ...
(l) ... ... ...
(m) ... ... ...
Explanation VIII :- (i) "Best Before" means the date which signifies the end of the period under any stated
storage 23
conditions during which the product will remain fully marketable and will retain any specific qualities for
which tacit or express claims have been made beyond that date the food may still be perfectly satisfactory.
(ii) In addition to the date of best before, any special conditions for the storage of the food shall be declared on
the label if the validity of the date depends on such storage."
Explanation VIIIC : "use by date" or "recommended last consumption date" or "expiry date" means the date
which signifies the end of the estimated period under any stated storage conditions, after which product
probably will not have the quality attributes normally expected by the consumers and the food shall not be
marketable."
28. Before going on to analyze the above provisions, it is necessary to refer to the factual background of the
instant case. As far as Spinach Powder is concerned, the manufacturing date was 19 August 2008. It's
manufacturer had mentioned that best before period over six months from the date of manufacture meaning
thereby that the best before period was to come to an end on 19 February 2009. The Spinach Powder was used
by the petitioner as a raw material for making the Potato Chips. The material on record does not indicate that
the best before date was mentioned by the petitioner on the wrapper containing the potato chips manufactured
from the above Spinach Powder. We are informed at the bar that the best before period mentioned on such
wrapper is three months. Mr.Dwarkadas, learned counsel for the petitioner submitted that since the best before
period for the Potato Chips made on 12 May 2009 from the Spinach Powder in question was three months, the
same would come to an end on 12 August 2009. But the 24

manufacturer of the Spinach Powder had already certified in the certificate dated 2 January 2009 that the
Spinach Powder manufactured on 19 August 2008 had best before period of six months from the date of
manufacture but the material was well acceptable in terms of quality attributes and safe and fit for human
consumption 12 months from its date of manufacture when stored in original sealed packs at ambient
conditions. Therefore, the Spinach Power was satisfactory till 19 August 2009. It is submitted that as "the best
before" period of Potato Chips made from the said Spinach Powder was to come to an end on 12 August 2009,
the Potato Chips made from the said Spinach Powder was a safe food for human consumption and satisfactory
till 19 August 2009.
29. However, in absence of any reference to the date of manufacture of the Potato Chips as indicated on the
wrapper containing Potato Chips made on 12 May 2009 that the Spinach Powder was manufactured on 19
August 2009, it would not be possible to give any specific finding whether the Potato Chips were satisfactory
as contemplated in Explanation VIII(i) above. There is also discussion in the impugned order as to whether in
special conditions what should be mentioned on the wrapper of the Spinach Powder for its storage. It is
obvious that even if the matter were to be remanded now, in absence of any label on the wrapper of the
Spinach Powder, it would not be possible either for the licensing authority or for the petitioner to throw any
light on the issue being discussed.
30. In view of Explanation VIII(i) to Section 32(b)(m), as interpreted in the case of Gangaiahnaidu Rama
Krishna Vs. State of A.P., 25
2005 (2)-ALD (Cri)-889 and in case of M/s.Hyderabad Beverages Pvt.Ltd. Vs. State of A.P., 2006-
Cri.L.J.-3988, the petitioner will get benefit of doubt on the questions whether the Potato Chips in question
were satisfactory till the date of expiry of the best before period for its raw material Spinach Powder.
31. However, as far as Besan is concerned, it's supplier had specified that the life of the Besan was only two
months. The Besan was manufactured on 3 March 2009 with best before period of 60 days i.e. 2 months.
Hence, on the date of inspection on 12 May 2009, the best before period of Besan was already over.
32. The petitioner's defence, however, is that as held by the Andhra Pradesh High Court in the cases above
referred, the expiry of best before period does not mean that even after the expiry of the best before period, the
food was satisfactory and that the burden of showing that the food was not satisfactory was on the respondent
authority.
33. Having carefully considered the rival submissions, we are of the view that while in a criminal proceeding
which may entail the sentence of imprisonment, the burden would be on the authority to show that beyond the
"best before" period, the food was unsatisfactory and that can be done only by getting their food samples
tested in the Central Food Laboratory, we see no reason why the manufacturer of the Potato Chips or any
other final product should be permitted to use the raw material/s beyond their "best before" date without
getting raw materials tested to ensure that they are satisfactory. It could never have been the intention of 26
the Legislature or Rule making authority that the manufacturer of the final product could use the raw materials
beyond their "best before" date without getting raw materials tested to see that they are satisfactory. It is
nobody's case, not ever the petitioner's case that the manufacturer has a right to manufacture the final product
by using raw materials which are unsatisfactory. Hence, for the purpose of complying with the conditions of
license issued under Rule 50 of the PFA Rules, 1955 read with Rule 5 of the Maharashtra Prevention of Food
Adulteration Rules, 1962 in conjunction with Rule 32 of the PFA Rules, 1955, it is only the manufacturer who
has to be fastened with the responsibility of ensuring that the raw materials are satisfactory at the time of
making the final product.
34. Having examined the scheme of the Rules and the conditions of license, we are of the view that even
though for the purposes of prosecution under section 16 of the Prevention of Food Adulteration Act, 1954
read with Rule 32(g)(i) (Explanation-VII), it may be necessary, as held by the Andhra Pradesh High Court in
M/s.Hyderabad Beverages Pvt.Ltd. Vs. State of A.P., 2006-Cri.L.J.-3988, for the Food Inspector to get the
sample of the raw material being used on the date of inspection and the finished product on the date of
inspection and get tested from the Central Food Laboratory. For the purposes of inquiry as to whether there is
adherence to the rules for issuance of license and the conditions of license are complied with or not, it is not
necessary for the licensing authority to get the sample of the raw material and the finished product tested and
it is for the licensee to ensure that the raw material being used by the licensee for making the food article
beyond the "best before" date 27
of the raw material is satisfactory on the date of manufacturing the food article (final article) and that the final
product will also be satisfactory till the "best before" date of the final product.
35. In view of the fact that it is for the first time that we are interpreting the provisions of Explanation-VIII to
Rule 32(m) of the Prevention of Food Adulteration Rules, 1955, we are of the view that the petitioner may not
be visited with the consequence of suspension of license only on the ground of using the Spinach Powder and
the Besan on the date of inspection beyond best before period indicated by their respective manufacturers.
36. Rule 50 of the PFA Rules, 1955 provides that no person shall manufacture, sell, ...... any article of food
except under a license. Rule 50 provides for various conditions of licence, some of which are as under :-
"(5) Before granting a licence for manufacture, stock or exhibition of any of the articles of food in respect of
which a licence is required, the licensing authority shall inspect the premises and satisfy itself that it is free
from sanitary defects. The applicant for the licence shall have to make such alteration in the premises as may
be required by the licensing authority for the grant of a licence:
Provided that the licensing authority may for reasons to be recorded in writing, refuse to grant a licence, if it is
satisfied that it is necessary to do so in the interest of public health.
28
(9) No licensee shall employ in his work any person who is suffering from infectious, contagious or loathsome
disease."
37. Rule 5 of the Maharshtra Prevention of Food Adulteration Rules, 1962 provides that any person desiring
for the manufacture for sale of articles for food in respect of which a licence is required under Rule 50 of the
PFA Rules, 1955 shall apply for a licence in Form A to the licensing authorities appointed by the Local
Authority. Rule 5 also makes detailed provisions for the conditions to be incorporated in the licence, some of
which are as under :-
"5. Licenses -
xxxxx xxxxx xxxxx

(3) On receipt of such application the licensing authority shall if on inspecting the said premises is satisfied
that the premises are free from sanitary defects and the applicant complies with other conditions for holding
license, grant the applicant a license in Form B on payment of fees laid down in Appendix I, Appendix II
[Appendix III or Appendix IV] in the Schedule.
Xxxxx xxxxx xxxxx
(5) The licensee shall abide by the provisions of the Act and the rules made thereunder, and the conditions of
the license granted to him. The licensing authority may suspend or cancel the license for breach of any of the
provisions of the Act or rules made thereunder or the conditions of license."
29
38. The license dated 9 August 2001 issued in favour of the petitioner and renewed from time to time
including the last renewal dated 18 February 2008 for the period upto 31 December 2012 contains various
conditions including the following :-
"(1) The licensee and his employees who manufacture the said food products, store the same, distribute them
or exhibit the same for sale or offers for sale such (1) potato chips, (2) Baked Corn products and (3) snacks
food products shall disclose in detail from which source the said articles were obtained along with its name
and address to the Food Inspector or licensing authority or Health Officer, on demand.
(4) (a) xxxxx xxxxx xxxxx
(b) The licensee shall arrange to get each room paved so that the same could be cleaned and washed in
appropriate manner.
(c) The licensee shall arrange to maintain each such room or paved places wherein utensils used for keeping
licensed food articles in a cupboard or on bench in a good and clean manner.
Xxxxx xxxxx xxxxx
(9) Surface of the internal walls of the above place be glazed with impregnable tiles or made smooth by
cement concrete upto 1 meter height from the floor. If this facility is not provided at present, the same be then
provided within the time the licensing officer specifies."
30
39. The allegations (E) and (G) about manufacturing area and the packaging area show that the petitioner had
not maintained the required cleanliness in the manufacturing and the packaging areas. The petitioner's
explanation that during inspection the areas were under cleaning process and hence dirt accumulation was
observed was not accepted as satisfactory because the Licensing Officer observed that some tiles were in
broken condition in manufacturing area and food items had accumulated in it and therefore there was violation
of Rule 5(3) and permission condition 4(b). Similarly, it was found by the Licensing Officer at the time of
visit that plastic covers (packaging film) and food items were spilled on the floor and, therefore, there was
violation of Rule 5(3) and condition 4(c).

40. Even while declining to interfere with the findings of the licensing authority, as confirmed by the appellate
authority, that the petitioner had committed breach of Rule 5(3) condition Nos.4(b) and (c) of the license
issued under Rule 5 of the Maharashtra Prevention of Food Adulteration Rules, 1962, we are not sure whether
the authority would have suspended the petitioner's license for a period of two days on the ground of breach of
the said conditions of the licence. Hence, we are inclined to remit the matter to the appellate authority for
considering this question afresh.
31
41. Another violation alleged by the authority is that the petitioner had violated Rule 50(9) of the Prevention
of Food Adulteration Rules which reads as under :-
"50. Conditions for license.-
(9) No licensee shall employ in his work any person who is suffering from infectious, contagious or loathsome
disease."
The learned counsel for the petitioner submits that the petitioner company had not employed any contract
labour who was suffering from any infectious, contagious or loathsome diseases. The petitioner had also
produced before the appellate authority a chart (Exhibit-K, Page-70 of the petition) showing medical check-up
of the workers. However,it appears from the appellate order that no reference is made to the said chart
reflecting the medical check-up of the workers.
42. Having regard to the allegations made in the petition and the explanation given by the petitioner company,
which was not found to be satisfactory, the licensing authority gave findings against the petitioner. However,
the appellate order does not indicate that the appellate authority had dealt with the material which was
produced by the petitioner at the hearing of the appeal. The appellate authority is not required to confine its
attention to the material which was placed before the licensing authority. The appellate authority is bound to
consider the material 32
placed before the appellate authority. Of course, it is for the appellate authority to examine and hold whether
the additional material produced before the appellate authority is credible and deserves to be accepted.
However, the appellate authority cannot refuse to consider the additional material placed by the licensee
before the appellate authority merely on the ground that it was not placed before the licensing authority. Of
course, the fact that some material is produced by the licensee before the inspecting officer as soon as show
cause notice is issued, will certainly carry much greater weightage so also the material which may be placed
by the licensee at the hearing before the licensing officer will also carry much greater weightage than the
material which the licensee may seek to produce before the appellate authority. But it is not that the material
which may be placed before the appellate authority should not at all be considered by the Appellate Authority.
43. Having heard the learned counsel for the parties, we are of the view that the matter deserves to be remitted
to the Appellate Authority to give a fresh hearing to the petitioner and to consider the matter afresh in the light
of the material which may now be placed before the appellate authority and in the light of the observations
made in this judgment.
44. In view of the above discussion, the petition is partly allowed. The impugned order dated 17th April 2010
of the Food (Health) Officer and Commissioner, Food & Drug Administration (M.S.), Mumbai 33

passed in Appeal No.14 of 2009 is hereby quashed and set aside and the matter is remitted to the appellate
authority for hearing Appeal No.14 of 2009 afresh. It will be open to the petitioner herein to place such further
material as the petitioner may seek to produce and it will be for the appellate authority to consider what
weightage should be attached to such material. The appellate authority shall re-hear the appeal and decide
Appeal No.14 of 2009 afresh in accordance with law and after taking into consideration the observations
made in the judgment within three months from the date of receipt of this judgment.
CHIEF JUSTICE
DR. D.Y.CHANDRACHUD, J.

Pepsico India Holdings Limited Vs State of Maharashtra On 23 December, 2010

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Pepsico India Holdings Limited Vs State of Maharashtra On 23 December, 2010

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Pepsico India Holdings Limited vs State Of Maharashtra on 23 December, 2010

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CIVIL APPELLATE JURISDICTION

WRIT PETITION NO.3998 OF 2010

CORAM : MOHIT S. SHAH, C. J. AND

DR. D.Y. CHANDRACHUD, J.

JUDGMENT RESERVED ON : 01 OCTOBER 2010

JUDGMENT PRONOUNCED ON : 23 DECEMBER 2010

JUDGMENT (Per Chief Justice)

2. By consent of the parties, petition was taken up for final disposal.

Indian Kanoon - http://indiankanoon.org/doc/151110/ 3

TO WHOMSOEVER IT MAY CONCERN

Indian Kanoon - http://indiankanoon.org/doc/151110/ 5

Sub : Shelf life extension.

Produce : 1327 Spinach Powder Lot No. : 264151

Manufacturing Date : 19th August, 2008

Sensient India Private Limited"

3. On the platform & steps food articles were found. 16

"32. Every prepackaged food to carry a label.-

(2) ... ... ...

(3) ... ... ...

(4) ... ... ...

... ... ...

(c) ... ... ...

(d) ... ... ...

(e) ... ... ...

(ii) in case of infant milk substitute and infant foods.

(h) ... ... ...

Indian Kanoon - http://indiankanoon.org/doc/151110/ 10

"BEST BEFORE ...... MONTH AND YEAR"

"BEST BEFORE ...... MONTHS FROM

"BEST BEFORE ...... MONTHS FROM

(j) ... ... ...

(k) ... ... ...

(l) ... ... ...

(m) ... ... ...

Indian Kanoon - http://indiankanoon.org/doc/151110/ 11

making the final product.

xxxxx xxxxx xxxxx

Indian Kanoon - http://indiankanoon.org/doc/151110/ 13

Xxxxx xxxxx xxxxx

(4) (a) xxxxx xxxxx xxxxx

Xxxxx xxxxx xxxxx

Indian Kanoon - http://indiankanoon.org/doc/151110/ 14

"50. Conditions for license.-

Indian Kanoon - http://indiankanoon.org/doc/151110/ 15

Indian Kanoon - http://indiankanoon.org/doc/151110/ 16

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