Government files case against Maggi seeking Rs 640 crore in damages

Acting tough against Nestle India, the government has filed a class action suit against the Swiss manufacturer of Maggi noodles, seeking about Rs 640 crore in damages for alleged unfair trade practices, false labelling and misleading advertisements.

Government files case against Maggi seeking Rs 640 crore in damages

The Consumer Affairs Ministry has for the first time dragged a company to the National Consumer Disputes Redressal Commission (NCDRC) using a provision in the nearly three- decade-old Consumer Protection Act.

This comes weeks after Nestle had to withdraw its instant noodles brand Maggi from the market over allegations of high lead content and presence of MSG (monosodium glutamate).

“We had earlier recommended filing a complaint against Nestle India over the Maggi issue before the NCDRC. Finally, we have filed the complaint,” Food and Consumer Affairs Minister Ram Vilas Paswan told PTI.

He did not share the punitive damages sought by the government, but said the new consumer protection bill, which was introduced in Parliament yesterday, would further strengthen the redressal of the consumer grievances.

Nestle India spokesperson did not offer any comment saying the company has not received any intimation about the issue.

However, sources said, “Under section 12(1D) of the Consumer Protection Act, we have filed a complaint before NCDRC against Nestle India over the Maggi issue. We have sought damage of about Rs 640 crore.”

“For the first time, the government has filed a class action suit against Nestle India to send a strong message to companies that they cannot sell sub-standard products in the country and put consumers’ health at risk,” source added.

The minister has filed a complaint against Nestle India for causing damage to Indian consumers by allegedly involving in unfair trade practices and false labelling related to the Maggi noodles product.

In the petition filed before the NCDRC, the ministry has charged that Nestle India has mislead consumers claiming that its Maggi noodle was healthy — “Taste bhi healthy bhi”.

“The company said no added MSG, despite presence of MSG.

The Ministry in its complaint has also charged that there was “lead content” in Maggi noodles more than the prescribed limits and the company has not done “risk assessment nor taken product approval for the Maggi masala oats”, sources added.

Usually, NCDRC comes into the picture following complaints filed by a consumer, but a section of this Act of 1986 also provides for the government to register a complaint. In June, food safety regulator FSSAI had banned Maggi noodles after it found excess level of lead in samples, terming it as “unsafe and hazardous” for human consumption.

FSSAI had also said Nestle violated labelling regulations on taste enhancer ‘MSG’ and ordered the company to submit a compliance report on its orders.

Posted by on August 12, 2015. Filed under Nation. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.