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Maggi fiasco returns to haunt Nestle India as SC revives class action suit





New Delhi: More than three years after the Maggi ban, the ghost of the 2015 fiasco seems to be back to haunt Nestlé India, the maker of Maggi noodles.

The Supreme Court revived a class action suit filed by the Union government against the Swiss food major for allegedly selling noodles that were unfit for consumption. The quality of the widely sold instant noodle is again expected to be under the scanner of the National Consumer Disputes Redressal Commission (NCDRC).

While the Supreme Court allowed the class action suit by the NCDRC, it upheld Nestlé’s stand by not allowing any further sampling or testing exercise.


Any further probe, it said, will proceed on the basis of the old report filed by the Central Food Technological Research Institute (CFTRI), Mysore. The CFTRI had found lead at a level lower than what the Food Safety and Standards Authority of India (FSSAI), the country’s apex food regulator, permitted. It further pointed out that despite the presence of monosodium glutamate (MSG) in Maggi samples, it was unable to determine whether it was from natural sources or added artificially. According to the Food Safety and Standards Act, there is no ban on food items that contain MSG occurring from natural sources.

The FSSAI banned all variants of Maggi noodles on June 5, 2015, after initial tests confirmed the presence of MSG and high levels of lead in them.

The long-drawn battle between the Union government and the food major gathered steam in August 2015, when the consumer affairs ministry filed a class action suit against Nestlé India in the NCDRC, seeking Rs 640 crore in damages. The move was the first such instance when the Union government had, suo motu, filed a class action suit against a firm. In a separate piece of litigation, the FSSAI and Nestlé continue to fight over the quality of Maggi noodles

“The class action suit was filed under Section 12(1) (d) of the Consumer Protection Act, 1986. It was the first time that the government invoked this Section against a company. The same has not been used since,” advocate Nitish Banka, who has followed the case, said.

Chart The government had, in its plea before the consumer disputes commission, alleged that Nestlé India, with the tagline “Taste bhi healthy bhi”, had misled consumers by claiming that Maggi was healthy, when its products contained lead and MSG.

The class action suit in the NCDRC was stuck when Nestlé approached the Supreme Court in December against the NCDRC’s interim orders seeking fresh sampling and lab tests on Maggi noodles. The firm had argued that tests conducted in non-accredited laboratories were not fit for consideration, citing a Bombay High Court order that gave a clean chit to Maggi noodles in October, citing similar reasons.

Welcoming the Supreme Court order, a Nestlé India spokesperson said, “The Supreme Court, in view of reports from the CFTRI, has agreed with Nestlé’s contention and has set aside both the interim orders passed by the NCDRC which were challenged by Nestlé.”

After a sharp drop, once the Supreme Court order came out, Nestlé India’s stock ended 1.36 per cent higher at the BSE at 11,191.10.

Litigation between the FSSAI and the food company, which went to the apex court after the Bombay High Court order, is expected to come up this month. However, sources in the FSSAI say that disagreement over the quality of products collected from Nestlé has been resolved and the regulator is satisfied with the company’s initiatives on the front. However, it is expected to take up certain reservations in the Bombay High Court, which rejected reports of non-accredited labs. “These state labs are in delivering appropriate results and we are working with them. Thus, it is not feasible to outright reject their credibility,” said a senior official at the FSSAI.

Since its re-entry in November 2015, Maggi noodles regained top slot. However, its market share continues to remain lower — at 60 per cent — than the pre-ban level. The brand raked in over Rs 2,600 crore in 2017.



RBI needs to ensure stability: Shaktikanta Das




New Delhi: The head of the Reserve Bank of India (RBI) said he would take the steps necessary to maintain financial stability in the country and help create favourable conditions for growth.

India’s economy has grown because of measures such as the nationwide goods and services tax and the insolvency and bankruptcy code that prevents wilful defaulters from bidding for stressed assets, Shaktikanta Das said in his address to an investor roundtable.

The country’s growth story is backed by its strong domestic fundamentals, he said, citing lower inflation.


Annual retail inflation rate dropped to an 18-month low of 2.19 per cent in December, strengthening the views of some economists that the central bank could ease monetary policy next month.

India’s top business groups on Thursday urged the central bank to cut its benchmark interest rate by at least half a percentage point and lower the cash reserve ratio it imposes on banks.

The country also needs to watch out for any sudden turbulence in the gloal financial market, Das said.

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Centre removes two PNB executive directors for lapses in Rs 13,500-cr fraud




Chennai:The Central government has removed two Punjab National Bank (PNB) Executive Directors — Sanjiv Sharan and K.Veera Brahmaji Rao — for the lapses in the Rs 13,500 crore fraud allegedly perpetrated by absconding diamantaire Nirav Modi.

The PNB has intimated the action to the stock exchanges.

“We welcome the Central government’s action to dismiss the two Executive Directors. The scam of such proportions could not have happened without the knowledge of the top management,” C.H. Venkatachalam, General Secretary, All India Bank Employees’ Association (AIBEA), told IANS.


“Perhaps for the first time, the Centra has removed the Executive Directors of a nationalised bank under the Nationalised Banks (Management and Miscellaneous Provision) Scheme, 1970. All these days it was said the top management of government-owned banks — Chairman, Managing Director, Executive Directors — are governed only by the contract of appointment.

“It is also good that the central government has followed the due process of giving the two PNB Executive Directors opportunity to put forth their views before dismissing them,” Venkatachalam added.

According to the Central government’s notification, on July 3, 2018, Sharan and Rao were issued a show cause notice as to why they could not be removed from office for having failed to exercise proper control over the functioning of PNB, thus enabling the fraud through the misuse of SWIFT at the bank’s Brady House branch in Mumbai.

After considering Sharan and Rao’s replies and the comments of the bank’s Board, the Centre removed them from office as it found it was expedient in the interests of PNB.

According to the notification, the dismissal of Rao is subject to the outcome of a plea in the Delhi High Court.

“We are happy to see some action being taken. Whether it is only the two Executive Directors and other officials are also involved in the scam has to be probed in full,” Venkatachalam said.

According to him, in the past, low-level officers would have been the scapegoats for such massive scams.

“With the action taken on the top management, people will be satisfied that public sector bank officials are answerable for their lapses,” Venkatachalam added.

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In this new world, data is the new wealth: Ambani




Mumbai: Reliance Industries chairman and managing director Mukesh Ambani urged Prime Minister Narendra Modi to take steps against ‘data colonisation’, specially by global corporations, stating that Indian data must be owned by Indians.

Invoking Mahatma Gandhi’s movement against political colonisation, Ambani said India now needs a new movement against data colonisation.

“Gandhiji led India’s movement against political colonisation. Today, we have to collectively launch a new movement against data colonisation,” he said Gandhinagar at the Vibrant Gujarat Global Summit.


Stressing that, in this new world, data is the new wealth, Ambani said, “India’s data must be controlled and owned by Indian people and not by corporate, especially global corporations.”

He further said, “For India to succeed in this data driven revolution, we will have to migrate the control and ownership of Indian data back to India. In other words, give Indian wealth back to every Indian.”

Stating that the “entire world has come to recognise” Modi “as a man of action”, Ambani said, “Honorable Prime Minister, am sure you will make this one of the principal goals of your digital India mission.”

Later in the day, countering Ambani’s call, Governor – Commonwealth of Kentucky, Matthew Griswold, asked Modi “to think in the opposite” in order to realise the tremendous opportunity that lies in Indo-US partnership.

“Honorable prime minister you have been asked from this stage to think about limiting the amount of competition, limiting the exchange of ideas, information and goods. I would encourage you to think in the opposite,” he said.

While stating that it is important to put the people of India first, Griswold said, “It is also important to put their opportunity and our opportunity as citizens of the world to trade with one another and exchange ideas because iron sharpens iron.”

The greatest possibility comes from the exchange of these idea, he added.

“If we can cut the regulations, cut the bureaucracy, cut the red tape, the opportunity is enormous between our nations,” he added that India is now the 10th largest trading partner for the US and “climbing quickly”.

“The opportunity before us between India and the United States is incredible, but responsibility falls on each of one us, those of us in elected positions, those of you in the industry, those of you who represent various constituencies, we have much work to do…we must do this, ” Griswold said.

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