*THE HON'BLE SRI JUSTICE V.V.S.RAO +WRIT PETITION No.11936 of 2001 % Dated 24.10.2008 # M/s.TVS Electronics Limited … Petitioner VERSUS $ Union of India and others. … Respondents. ! Counsel for Petitioner: Sri C.Kodanda Ram ^Counsel for Respondent 1: Mr.A.Rajashekar Reddy (Assistant Solicitor General) ^Counsel for Respondents 2 to 5: GP for Civil Supplies <GIST: >HEAD NOTE: ? Cases referred 1. 2003(2) ALD 577 2. 2003(2) ALD 742 3. AIR 2006 Bom 336 4. 2006(5) MHLJ 361 5. (2004) 7 SCC 591 6. 2008(1) ALD 105 (SC) 7. 2003 (2) ALD 577 8. 2006 (4) AIR Bom 570 = 2006 (5) MhLJ 361 9. (2004) 7 SCC 591 10. (2002) 1 Mad L W (Cri) 211 IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) , DAY OF OCTOBER TWO THOUSAND AND EIGHT PRESENT THE HON'BLE SRI JUSTICE V.V.S.RAO WRIT PETITION No.11936 of 2001 Between: 1. M/s.TVS Electronics Limiter, a Company Incorporated under the Companies ACt., Rep by its General Manager (Finance), Having its Office at 8, Haddows Road, Chennai - 600006, 2. K.Rama Swamy S/o. S.R.Krishna Murthy Shastry, R/o. Mutthu Lakshmi Sala\i, Tiruvanmayur, Chennai. ..... Petitioners AND 1. The Union of India, Rep by its Secretary, Civil Supplies, New Delhi. 2. The State Of A.P. Rep by its Secretary Civil Supplies Secretariat, Hyderabad. 3. Controller of Legal Metrology Department of Weights & Measures, RTC X Roads, Hyderabad. 4. Inspector of Legal Metrology Department of Weight & Measures, Tenali. 5. Inspector Of Legal Metrology Department of Weights & Measures, Vijayawada. .....Respondents Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to issue a Writ, Direction or order more particularly one in the nature of Writ of Mandamus or any other appropriate writ declaring (a) the action of the respondents in issuing the impugned notice vide l.R.no.170/PC/2000-2001 dt.16.11.2001 issued by the 5th L.R.No.217/00-01, dt.10.4.2001 issued by the 5th respondent and Notice No.39/PC/2001 dt.24.5.2001 issued by the 4th respondent as arbitrary, illegal, ultra virus and violative of the petitioner's rights guaranteed under Articles 14, 19(1)(g)of the constitution of India and ultra virus of the provision of the Act and rules made thereunder. (b) That the provision of the Weights & Measures Act and rules made thereunder are not applicable for the sale of Computer, Compatible printers and allied accessories such as manufactures/distributed by the petitioner. Counsel for the Petitioner: M/S.C.KODANDA RAM Counsel for the Respondents: MR.A.RAJASHEKAR REDDY (ASST SOLICITOR GEN) The Court made the following: THE HON’BLE SRI JUSTICE V.V.S.RAO WRIT PETITION No.11936 of 2001 ORDER: M/s.TVS Electronics Limited (TVS Electronics, for brevity) and their General Manager ﬁled instant writ petition questioning communications of respondents 4 and 5 (Inspectors of Legal Metrology, Tenali and Vijayawada respectively) informing that petitioners have committed oﬀences under Section 39 of the Standards of Weights and Measures Act 1976 (for brevity, the Act) and Rule 23(1) of the Standards of Weights and Measures (Packaged Commodity) Rules 1977 (hereafter, Package Rules) punishable under Section 67 and Rule 39(1) of Package Rules. By impugned communication, petitioners were also informed that alleged oﬀence is compoundable under Section 73 of the Act. If petitioners so desire, it was advised; they may pay necessary compounding fee within ﬁfteen (15) days. Petitioners contend that the Act and Package Rules have no application to electronic printers (inkjet/laser/DOT Matrix printers etc) manufactured and marketed by them and that impugned communications are without authority or jurisdiction. Thus the case involves an interesting question as to whether electronic printers manufactured and marketed by TVS Electronics are “packaged commodities” within the meaning of Package Rules and for non-compliance with Rules and speciﬁcations, TVS Electronics has committed compoundable offence as contended by Department of Legal Metrology, Government of Andhra Pradesh. The following brief fact of the matter is necessary to appreciate the question involved. TVS Electronics (a company registered under the Companies Act 1956) is engaged in the business of import manufacture, distribution and sale of computer peripherals like inkjet printers, DOT Matrix printers, printer cartridges etc., which are marketed in various States including Andhra Pradesh. Printers which are imported and/or assembled in their manufacturing unit in Tamil Nadu are distributed through their marketing outlets in various States, to retail dealers who sell them to needy customers through their sales staﬀ. Electronic printers are fragile and are sensitive. Therefore they are protected by keeping in bubble ﬁll covers, packing in well- insulated material to protect from damage. A consumer cannot readily use electronic printers. Computer compatible software drivers are to be installed before electronic printers are made useable. Just buying a printer from a retail dealer of TVS Electronics without proper installation of software is futile. They are ordinarily not sold ‘off the shelf’ and are marketed as a single unit and not in lots of more than one piece. It appears that on 16.8.2000 ﬁfth respondent inspected M/s.Elite Electronic Industries Limited, Labbipet, Vijayawada (hereafter, Elite Electronics). He found one retail package of MSP 245 9 wire 136 columns DOT Matrix printer manufactured by TVS Electronics without marking of sale price and therefore he issued a show cause notice dated 16.11.2000 calling upon ﬁrst petitioner to submit explanation as to why action should not be taken for violation of Rules 4 and 6(1)(f) of Package Rules and Section 39 of the Act. Fifth respondent again inspected Elite Electronics on 04.12.2000 with two witnesses (panchas) and issued notice dated 09.1.2001 alleging that one retail package of Lexmark 211 color jet printer was being sold and that said package does not contain name and address of importer and retail sale price. He therefore issued another show cause notice dated 10.4.2001. First petitioner was asked to inform name, age, father’s name and designation of person responsible for oﬀence committed under Rule 33 read with Rule 23(1) of Package Rules. At or about same time, fourth respondent, namely, Inspector of Legal Metrology, Tenali, inspected premises of M/s.Surya Systems, Tenali, on 23.5.2001 and found two packages of TVS Electronics ‘Smart Mouse’ without details on package with regard to sale price, manufacturer and year of packing. Therefore, fourth respondent issued notice informing that oﬀence under Sections 39 and 33 of the Act and Rules 6(1)(f) and 6(1)(d) of Package Rules is compoundable under Section 73 read with Section 65 of the Act. Petitioners sent reply to notices but by a letter dated 10.4.2001, ﬁfth respondent rejected contentions of petitioners and informed decision not to drop action for alleged contravention of the provisions of the Act and Package Rules. Union of India, ﬁrst respondent, ﬁled counter aﬃdavit opposing writ petition. The contents thereof are as follows. Personal Computers (PCs), Printers and Printer accessories marketed and distributed by petitioners in pre- packed form, attract provisions of Package Rules. The products are manufactured in one State and sold throughout country. Therefore they come under inter-State transactions. Petitioners require to comply with provisions of the Act and Rules. Even if petitioners’ products are sold as a single piece, they attract provisions of the Rules. Therefore it is necessary to make declaration on the package with regard to name and address of manufacturer, name of commodity, quantity, month and year of package as well as retail sale price in the form of MRP inclusive of all taxes. Petitioners have not complied with provisions of Rules 4 and 6 of Package Rules and therefore action initiated against them is legally valid. The PCs and printers of petitioners fall under the deﬁnition of “pre- packed commodity” as per Rule 2(l) of Package Rules. Non- compliance with provisions of the Act attracts penal provisions. Third respondent ﬁled counter aﬃdavit. Various averments therein are similar to counter averments of ﬁrst respondent and therefore it is not necessary to re- summarise, except referring them at appropriate place whenever necessary. Rival submissions Learned Counsel for petitioners Sri C.Kodanda Ram made following submissions. (1) In the absence of notiﬁcation under Section 1(3)(d) of the Act notifying Computer inkjet/DOT Matrix printer as “commodity in packaged form”, the Act and the Rules cannot be applied to these goods manufactured by petitioners; (2) Inkjet/DOT Matrix printer is not a “commodity” and it cannot be treated as a “commodity in packaged form”; and (3) Electronic printers are fragile and sensitive and therefore they are oﬀered for sale protecting them in package form with proper insulation. Even though electronic printers are kept in well-insulated packages, they cannot be treated as “commodity in packaged form” or packaged commodities because a person who buys them cannot be readily use without installation of software printer drivers in PCs with which printers are intended to be used. Learned Counsel placed reliance on Titan Watches Ltd v Senior Inspector Legal Metrology, W&M Dept [1], Eureka Forbes Limited v Union of India[2], Titan Industries Ltd v Union of India[3] and Subash Arjandas Kataria v State of Maharashtra[4]. The contentions and submissions made by learned Government Pleader for Civil Supplies, Sri W.B.Srinivas, are as follows. (1) The Government of India issued notiﬁcation dated 26.9.1977 under Section 1(3) of the Act appointing 26.9.1977 as day on which certain provisions of the Act shall come into force and therefore no further notiﬁcation is necessary under Section 1(3)(d) of the Act; (2) Electronic printer is “commodity in packaged form” as per 2(b) of the Act and fall within deﬁnition of “pre-packed commodity” as per Rule 2(l) of the Rules; (3) Section 39(9) of the Act and Rule 34 of the Rules provide for exempting speciﬁed goods from provisions of the Act, and in the absence of exemption given to electronic printers manufactured by petitioners cannot escape applicability of provisions of the Act and Rules; and (4) As per Rule 33 of Package Rules all pre-packed commodities imported into India shall have to carry declaration and details as speciﬁed. The colour inkjet/DOT Matrix printers supplied by TVS Electronics to retailers do not comply with provisions of Rules 2(l) and 2(p) of Package Rules and therefore petitioners are liable. Learned Government Pleader relies on ITC Ltd v Commissioner of Central Excise[5], Titan Industries Ltd (supra) and Whirlpool of India Ltd v Union of India[6]. Points for determination (1) Whether provisions of the Act and Rules made thereunder including Package Rules can be applied and enforced even in the absence of any speciﬁc notification under Section 1(3)(d) of the Act? (2) Whether electronic printers manufactured, distributed and marketed by TVS Electronics or their retail dealers can be treated as “commodities in packaged form” and/or “pre-packed commodities” for the purpose of the Act and Package Rules? Whether the Act has come into force with reference to electronic printers? The ingenuous argument of petitioners that the Act cannot be enforced in respect of electronic printers imported and/or manufactured by them draws strength and support from Section 1, especially Section 1(3) of the Act. The provision reads as under. 1. Short title, extent and commencement (1) This Act may be called the Standards of Weights and Measures Act, 1976. (2) It extends to the whole of India (3) It shall come into force on such date as the Central Government may, by notiﬁcation, appoint, and diﬀerent dates may be appointed for different- (a) provisions of this Act, (b) areas, (c) classes of undertakings, (d) classes of goods, (e) classes of weights and measures, or (f) classes of users of weights and measures, and any reference in any such provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision in such areas, or in respect of such classes of undertakings, goods, weights and measures or users of weights and measures in relation to which this Act has been brought into force. (Proviso omitted) It is well accepted legislative practice that sometimes legislation after its enactment is not brought into force immediately. The power to bring the legislation into force is entrusted to the executive Government (and it is not considered as delegation of legislative power). It is absolutely within the discretion of executive Government to bring into force an enactment and Mandamus cannot be issued to Government to enforce the statute or provision. A legislation more often than not confers wide ranging power on executive Government to enforce an enactment either wholly or partly applicable to the entire territory or part of the territory. Such power may also include power to apply the enactment in a phased manner with reference to territorial areas, persons covered and subject matter with which the legislation deals. If legislation confers power on Government to bring the law into force by issuing an order notifying the date when the Act shall come into force, and when such notiﬁcation is issued bringing all the provisions of the Act into force, nothing more is required. The entire law/enactment is enforceable. This situation remains unalterable notwithstanding the fact that the provision conferring power on executive Government gives discretion to appoint diﬀerent dates for bringing into force diﬀerent provisions of the Act or persons/subject matters to which such Act applies. A perusal of sub-section (3) of Section 1 of the Act as above would show that Central Government is given power to bring into force the provisions of the Act. It also confers power to appoint diﬀerent dates for enforcement of the Act for diﬀerent areas, classes of undertakings, classes of goods, classes of weights and measures or classes of users of weights and measures. The legislative choice to use the word ‘OR’ after end of Section 1(3)(e) of the Act would clinchingly show that a notiﬁcation appointing the date for the purpose of enforcing the provisions of the Act takes within its fold all other aspects of the matter. So to say, when once notiﬁcation is issued bringing into provisions of the Act, there need not be separate notiﬁcation with reference to the areas, classes of undertakings, classes of goods etc. The Government of India vide their notiﬁcation No.G.S.R.620(E), dated 26.09.1977 appointed the said date as the date on which Sections 1 to 3, 28, 29, 31(b), 39, 48(2), 54, 63, 67, 69, 70 to 74, 78 and 83 shall come into force. They also issued another notiﬁcation No.G.S.R.193(E), dated 01.04.1980 appointing the said date as the date on which Sections 76 and 77 shall come into force. About a year thereafter, again on 01.07.1987 notiﬁcation No.G.S.R.617(E), was issued appointing the said date as the date on which almost all the provisions came into force. It is very interesting to notice that all the three notiﬁcations were issued in exercise of powers conferred under Section 1(3) which only means they cover all aspects found in Section 1(3) and not extracted to any of them. The submission of learned counsel for petitioners, therefore, cannot be accepted. Learned counsel for petitioner relied on Titan Watches Limited v Senior Inspector Legal Metrology, W&M Department[7], in which this Court took a view that in the absence of notiﬁcation under Section 1(3)(d) of the Act, the Act has no application to wrist watches. It appears this Judgment of learned single Judge is in appeal being W.A.No.1448 of 2004. Therefore, the same is not helpful to petitioners. In Subash Arjandas Kataria v State of Maharashtra[8], the view of Andhra Pradesh High Court was not accepted by Division Bench of Bombay High Court. The Division Bench considered a question that when once a notiﬁcation under Section 1(3) of the Act is issued, appointing the date or the dates for enforcing various provisions of the Act, there is no requirement of issuing notiﬁcation/notiﬁcations specifying dates with reference to other classes under Section 1(3) of the Act. The following passage may be beneficially extracted. It may be pointed out that by Notiﬁcation dated 26th September, 1977, the Central Government under section 3(1) of the Act appointed 26th September, 1977 as the appointed date for enforcing the provisions of sections mentioned therein particularly sections 1, 2 and 3 and sections 39 and 83. Under section 83 of the Act, the Central Government is empowered to make Rules in respect of packaged commodities. Accordingly, Rules have been made dated 26th September, 1977 covering all packaged commodities. Section 1(3) of the Act sets out that it shall come into force on such date as the Central Government may, by notiﬁcation, appoint and diﬀerent dates may be appointed for diﬀerent (a) provisions of this Act, (b) areas, (c) classes of undertakings, (d) classes of goods, (e) classes of weights and measures, or (f) classes of users of weights and measures. In other words, what it implies is that the provisions of the Act may be made applicable by notiﬁcation on one day and/or diﬀerent dates may be ﬁxed for diﬀerent provisions of the Act to come into force for various areas, classes of undertakings, etc., as set out earlier. In the instant case the Notiﬁcation dated 26th September, 1977 has brought into force the various provisions as set out therein viz., sections 1, 2, 3 and 39 as also 83. Once those sections have come into force, there is no requirement that there must be a diﬀerent notiﬁcation specifying the diﬀerent dates for diﬀerent provisions of the Act to be brought into force for various areas, etc. The submission, therefore, made on behalf of petitioners that diﬀerent dates have to be notiﬁed for various areas, classes of undertakings, etc., is devoid of merit considering the notification. All prepackaged commodities covered by the Act and the Rules, will be governed by the sections which have been brought into force to the extent applicable. (emphasis supplied) Whether electronic printer is a commodity? If the answer is ‘yes’ for this question, can it be considered as a pre-packed commodity, in which event the Act would be applicable to electronic printers? Though commodity is not deﬁned, as per Section 2(b) of the Act, ‘commodity in package form’ means ‘commodity packaged in a bottle, tin, wrapper or otherwise, in units suitable for sale, whether wholesale or retail’. The ordinarily dictionary meaning of ‘commodity’ is ‘a raw material or primary agricultural product that can be bought and sold, or a useful or valuable thing” (see The New Oxford Dictionary of English: Indian Edition 2002) but Parliament has used the meaning in a broader sense. All valuable things, which are oﬀered for sale are commodities for the purpose of the Act. Chapter IV of Part IV the Act (only Section 39) deals with commodities in packaged form intended to be sold in course of inter- state trade or commerce. Section 39(1) of the Act prohibits manufacturing, packaging and/or selling any commodity in packaged form unless such package bears label to identify the commodity in the package, net quantity in terms of standard unit of weight or measure of the commodity in package, the accurate number of commodities in the package, the unit sale price and the like. Sub-section (9) of Section 39 of the Act empowers Central Government to exempt classes of commodities or packages from all or any of the provisions of Section 39 of the Act. Other subsections of Section 39 of the Act provide that every package shall contain the name of manufacturer or packer and also other details. As per heading of Chapter IV section 39 of the Act applies only to commodities in packaged form sold during the course of inter-state trade or commerce. This is explicitly laid down in Section 31 of the Act, which inter alia provides that part IV (dealing with inter-state trade or commerce) shall apply to goods, which are intended to be sold, distributed, delivered or otherwise transferred by weight, measure or number in course of inter-state trade or commerce. A submission was made that Sections 31 and 39 of the Act have no application to the electronic printers distributed and sold by ﬁrst petitioner. A perusal of the aﬃdavit accompanying writ petition does not warrant any such conclusion. Admittedly ﬁrst petitioner imports electronic printers in knocked down condition, assembles/manufactures electronic printers and transfers them to distribution center/oﬃce in Hyderabad, who in turn sell through a network of retail dealers. According to learned counsel, transfer of electronic printers from Tamil Nadu to Hyderabad oﬃce does not amount to inter-state trade or commerce. The submission is misconceived. In case of marketing strategy as adopted by ﬁrst petitioner, even though there was no consideration paid by Hyderabad oﬃce to ﬁrst petitioner’s manufacturing facility at Tamil Nadu, sale price consequently goes to ﬁrst petitioner and it can be presumed that the invoice raised by Hyderabad oﬃce would be invariably in the name of ﬁrst petitioner. Though a retail dealer pay sale price to Hyderabad oﬃce of TVS Electronics, ultimately it is intended to reach their oﬃce at Chennai. This satisﬁes description of inter-state trade or commerce, as deﬁned in Section 2(m) of the Act, which reads as under. 2(m) “inter-state trade or commerce”, in relation to any weight or measure or other goods which are bought, sold, supplied, distributed or delivered by weight, measure or number, means the purchase, sale, supply, distribution or delivery which,- (i) occasions the movement of such weight, measure or other goods from one State to another, or (ii) is eﬀected by a transfer of documents of title to such weights, measure or other goods during its movement from one State to another. Explanation I: Where any such weight or measure is, or other goods are, delivered to a carrier or other bailee for transmission, the movement of such weight, measure or other goods shall, for the purposes of sub-clause (ii), be deemed to commence at the time of such delivery and terminate at the time when delivery is taken from such carrier or bailee. Explanation II: Where the movement of any such weight, measure or other goods commences and terminates in the same State, it shall not be deemed to be a movement of such weight, measure or other goods from one State to another merely by reason of the fact that in the course of such movement it passes through the territory of any other State; In view of the above, this Court has no doubt to conclude that when ﬁrst petitioner distributes electronic printers in Andhra Pradesh through their oﬃce at Hyderabad, there is inter-state trade and commerce. Hence, if electronic printers can be considered as ‘commodities in packaged form’ and/or ‘pre-packed commodities’, Section 39 read with Section 31 applies. Pre-packed commodity means ‘a commodity placed in a package when the purchaser is not present, so that the commodity placed in package can be taken out for testing or examining or inspecting the commodity’ (Section 2(l) of Package Rules). The commodities in packaged form and pre- packed form are used interchangeably. Package Rules shall apply only to commodities in packaged form. It may be noticed that Sections 39(1), 39(6), 39(8), 39(9), 48(2), 63 and 65 of The Act use the phrase ‘commodity in packaged form’. The said phrase is also used in Rules 2(n), 2(o), 2(p), 2(r), 2(u), 2(w), 6(b), 9(2), 11 and 12 of the Rules. Rules 18 to 31, 34 and 39 employ the word ‘package’. As part IV including Chapter IV of the Act apply to commodities in packaged form sold and distributed in course of inter-state trade or commerce, and Package Rules apply only to commodities in packaged form, it becomes clear that Package Rules are applicable to commodities in packaged form sold and distributed during the course of inter-state trade or commerce. Be that as it is, as per Rule 2A of Package Rules, Package Rules have no application to packages intended for retail sale, if such packages contain commodities more than 25 kg or 25 litres excluding cement and fertilizer sold in bags of 50 kg. Package Rules also have no application to packaged commodities meant for industrial consumers and institutional consumers. The Rules in Chapter II stipulate conditions or requirements subject to which pre-packed commodities can be sold. These include the display of quantity in terms of standard unit of weight or measure, the