The 640 crore class action suit filed by the government against Nestle in National Consumer Disputes Redressal Commission will come up for hearing on Monday. Nestle India has claimed that it will convincingly be able to defend itself in court.
In a first, the Consumer Affairs Ministry filed a case against the firm with the National Consumer Disputes Redressal Commission seeking about Rs 640 crore in damages for alleged unfair trade practices, false labelling and misleading advertisements.
Nestle India has said that it is yet to decide on filing a counter suit. The hearing comes just a week after the Bombay High Court lifted the ban on Maggi noodles.
Unfazed by the Bombay HC order quashing the ban on Maggi noodles, Union Minister Ram Vilas Paswan said the verdict does not alter the grounds on which it has claimed Rs 640 crore in damages from Nestle for misleading advertisement and unfair trade practices.
Nestle India got a reprieve last week from the High Court which lifted the ban slapped by food regulators on nine variants of the popular instant noodles across the country and asked the company to go for fresh tests of the product. On behalf of the consumers, the Food and Consumer Affairs Ministry separately filed a Class Action Suit against Nestle India before the National Consumer Disputes Redressal Commission (NCDRC), using a hitherto unused provision in the three-decade-old Consumer Protection Act.
Stating that the High Court order would not alter the grounds on which the case has been filed at NCDRC, Paswan said the government would not withdraw its petition. "The decision of the Bombay High Court does not materially alter, either on law or on facts, the grounds urged in our complaint," Paswan said.
The petition has made a case that the trade practices followed by Nestle India were "unfair, deceptive and misleading" and therefore to the detriment to the consumers, he said.
"There is no question of withdrawing our petition against the company. It has been listed before NCDRC for admission and the case is likely to be heard on Monday," he added. Nestle, which had to recall the popular noodles brand after orders from the central food safety regulator FSSAI and food regulators in various states, is the first foreign firm in India to face a class action suit.
The Ministry has sought Rs 284.45 crore in basic damages and further Rs 355.50 crore in punitive damages, resulting in total damages of Rs 639.95 crore from the Swiss giant. The damage claim from Nestle for selling "defective and hazardous" Maggi noodles may rise further as the Ministry said in the petition that it is in the process of "tabulating further damages" and will seek additional damages when further facts and data emerges.
The government also wants Nestle India to pay interest at a rate of 18 per cent per annum till the date of actual payment, while it has also asked the consumer forum to order the company to take remedial measures for wrong labelling and misleading advertisements.
The amount has been proposed to be deposited in the Consumer Welfare Fund of the government.
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