Brief Presentation On Recent Amendments in the Legal Metrology (Packaged Commodities) Rules, 2011

BCHAALegal Metrology Rules 2011- Amendments

Definition of Industrial & Institutional Consumer changed:- The definition of ‘industrial’ and ‘institutional consumer’ has been amended allowing the industries

and institutions to make direct purchases from importers and wholesale dealers. Earlier, the

definition only recognized those purchasers who were making direct purchases from manufacturers.

Import from Direct Manufacturer not mandatory:- The purchases from “wholesale dealers” has been considered for the first time and is a welcome

change. A wholesale dealer is a dealer which does not sell goods to an ultimate consumer but sells

the same to or through intermediaries

‘’Not For Retail Sale” Label request on packages meant for Institutional Sale:-

Further, it has also been necessitated that the package which are meant for sales to industrial/ institutional consumers should have a declaration “not for retail sale” thereon.

The aforesaid amendments have been made to align the Packaged Commodity Rules with the following judicial Pronouncements

Henkel CAC Pvt. Ltd. vs CCE - 2012 (282) ELT 566 (Tri-Mum); CC vs. Nitco Tiles Limited - 2011 TIOL 737 Tribunal- Mumbai; H.R. Johnson vs CCE –Tri. Mum vide Order No. A/330-332/14/EB/C-II dated 2.4.2014; Letter No. WM 10(23)/ 2014 dated 9.5.2014 issued by the Legal Metrology Division

BCHAALegal Metrology- Amendments

Comparision – Old Vs New

Basis Old New

Who all are covered For industrial consumers: All consumers

For industrial consumers : All consumers

For institutional consumers: Institution who hire or avail of services in connection with hotel, transport, hospital and such other institutions.

For institutional consumers : Institutions who hire or avail of services in connection with hotel, transport, hospital and other institutions.

Source of Procurement

Direct purchases from manufacturer alone.

Direct purchases from Manufacturer, Importer and wholesale dealer

Usage Use by concerned industry/ institution

Use by concerned industry/ institution

Declaration at the time of Import

N/A Package should have a label“Not for Retail Sale”.

BCHAA

Legal Metrology- AmendmentsChanges which will be applicable from 1-1-2016

Declarations under Rule 6 of PC Rules

Mandatory to provide the email address for consumer complaints. In respect of imported packages, it would be permissible to affix a label for making declarations required under these Rules.

Earlier, if the outer cover was not transparent and the declarations were made on the outer package, then in terms of the proviso to Rule 9(3), the assessee used to avoid making declarations on the inner package. The said proviso has been omitted. Consequently, if a retail package is packed in an outer cover which is not transparent, in terms of the amended Rule 9(3) of the PC Rules, it would be necessary that both the outer package and inner package have all the declarations.

Declarations relating to complete address

Explanation to Rule 10 of the PC Rules has been amended requiring mention of the address at which the firm or company is registered on the package in place of the factory where the goods will be manufactured.

The aforesaid amendment will be applicable to an actual manufacturer, deemed manufacturer and also an importer.However, the address of the factory where the goods are actually manufactured will continue to be given in the registration application

BCHAAHow this will affect Import

1. Separate orders &

shipments for Retail Products

& Institutional Orders.

2. No changes in present

process of customs duties

payment for Retails Products.

1. Institutional Products will be assessed on Transaction Value (Buying Price) and not MRP

2. Special Additional Duty will have to be paid.

3. . Stop affixing MRP labels for imported institutional Orders, Only Affix Barcodes and “Not for Retail Sale” stickers

BCHAA