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 Nestle, the first foreign firm in India to face a similar damages
claim, is already weathering its worst public relations crisis in
the country to date, after regional food safety regulators reported
finding excess lead in its popular Maggi noodles, a result the
company disputes.
The government's lawsuit, citing unfair trade practices, the sale of
defective goods and the sale of a product without approval, has been
filed in the National Consumer Disputes Redressal Commission, a
quasi-judicial body whose rulings are legally binding.
"The department took exception (given) that Maggi was largely
consumed by children and Nestle's advertisements aimed at
popularizing Maggi among children," said a government official at
the food ministry.
Maggi instant noodles are hugely popular in India as a cheap, quick
snack, popular with school children and office workers and are
available at countless roadside eateries. They were withdrawn by
Nestle in June after the food scare broke.
The official said the government had arrived at the size of the fine
by "keeping in mind the numbers of consumers, the size of the market
and the number of complaints received". He did not want to be named
because he is not authorized to talk to media.
A Nestle spokesman in India said the company had not yet received
official notice of the government lawsuit. "We shall be able to
provide substantive response after we receive the official papers,"
he said.
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A regulator in the northern state of Uttar Pradesh said in May it
had found lead above permissible levels in a sample of noodles,
prompting denials from Nestle, which says it has carried out
hundreds of its own tests, and a debate on India's safety standards
and testing capacities.
Nestle has challenged the food safety regulators' findings in court,
and has demanded a retest of the samples. Those results are not yet
public.
Nestle India, which reported a second-quarter loss last month after
a plunge in sales following the recall, has said it is making "all
efforts" to bring Maggi noodles back into the market.
(Reporting by Nivedita Bhattacharjee in Mumbai and Mayank Bhardwaj
in NEW DELHI; Editing by Clara Ferreira Marques and Muralikumar
Anantharaman)
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