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Plea in SC seeks 'right to know' on product quality, seller details

Plea in SC seeks 'right to know' on product quality, seller details

A petition has been filed in the Supreme Court seeking to declare that consumers have a "right to know" about the quality, purity and certification of products, besides details of distributors and sellers for redressal against unfair restrictive trade practices.
It has also sought directions to the Centre and the states to ensure that every distributor, trader and shop owner displays details of registration, including name, address, phone number and number of employees at the entry gate in bold letters on a display board visible to people.
The plea is slated to come up for hearing on July 21 before a bench of Justices Vikram Nath and Sandeep Mehta.
The petition filed by petitioner Ashwini Kumar Upadhyay said "right to know" was crucial for consumers to make informed choices and to protect themselves from unfair or restrictive trade practices and unscrupulous exploitation.
"Right to know helps consumers avoid falling prey to a fraudulent or deceptive distributor, dealer, trader, seller and shop owner, who might misrepresent a product/service or disappear after sale, purchase and money transaction," said the plea, filed through advocate Ashwani Kumar Dubey.
It said that if a consumer has an issue with a product or service, knowing details about the distributor, dealer, and seller is essential for filing a complaint and seeking redressal through consumer redressal forums.
"When a distributor, dealer, trader, seller and shop owner are transparent about their details, it fosters a fair and competitive market where consumers can make informed choices," the plea said.
It said in essence, the right to know empowers consumers to be informed or protected and to make choices when engaging in sales, purchases and money transactions.
The plea has sought to direct and declare that "every consumer has 'right to know' not only about quality, quantity, potency, purity, standard, manufacturing date, expiry date and BIS/FSSAI certification of good/products, but also about the details of the distributor/dealer/ trader/seller and shop owner, so as to seek redressal against unfair restrictive trade practices and unscrupulous exploitation in spirit of sections 2(6), 2(9), 2(10) and 2(11) of the Consumer Protection Act, 2019".
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  • Time of India

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Now, the obvious arguments against the above procedural violations are that, though significant, they ought not to be considered to the detriment of the approved resolution plan in Bhushan Steel, especially since it interferes with the 'commercial wisdom' of the creditors. These arguments, undoubtedly, merit consideration, especially in a case such as Bhushan Steel where the sums involved are enormous. However, key questions arise: Can these violations be brushed aside solely because the CoC exercised its commercial wisdom? Would the violations have been viewed differently if they had been thoroughly considered by the Adjudicating Authority at the first stage of approval? Should the Court have remitted the matter for reconsideration instead of ordering liquidation? 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If one were to draw an analogy of section 29A of the Arbitration and Conciliation Act, 1996 which deals with extension of timeline for conclusion of arbitral proceedings, the law has been well settled that awards passed beyond the arbitral mandate are void. Similarly, if resolution plans were to be approved beyond the statutory timelines and without any formal approval of extension, it not only questions the objective of IBC of providing time-bound resolutions but it also accords an excessive weightage to the commercial wisdom which could be equally detrimental to other stakeholders. The Bhushan Steel judgment should not be remembered as an isolated incident but as a call to action. India's insolvency ecosystem must certainly evolve towards being a transformative tool for corporate recovery rather than a procedural labyrinth. At the same time, the cloak of 'commercial wisdom' ought not to be overlooked by the NCLT while evaluating a resolution plan. (The author is Advocate, Madras High Court)

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