Government may seek damages from Nestle

Goa 11th state to ban instant noodles brand

India’s government has filed for damages from food group Nestlé after a food scare involving reports of excess lead in Maggi noodles forced a nationwide recall, government officials said on Sunday.

“It’s a serious matter concerning public health and the law allows us to take suo moto legal steps, or legal actions, against erring entities,” said one official in the consumer affairs department of the food ministry.

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A Nestlé spokesman, when asked about the government move, said the company had not yet received any communication and cannot offer comments on the issue.

The claim, made on behalf of Indian consumers, was not filed through the courts but with the National Consumer Disputes Redressal Commission (NCDRC), which has semi-judicial powers and will decide on the merits of the case and the size of any damages.

The officials said Nestlé was being accused of unfair trade practices, adding this is the first case in which the Indian government has sought damages from a multinational. “We have sought Additional Solicitor General’s advice in this matter and he will appear on behalf of the government in NCDRC,” said an official.

A Nestlé spokesman in India said the company had not received any official notification as of Sunday, and could not comment.

The food ministry sources said NCDRC would notify the company when the case comes up, likely next week.

Nestlé has been under fire in India since one regional regulator said in May that it had found evidence of excess lead and monosodium glutamate (MSG) in some packets of Maggi instant noodles, a cheap and popular snack.

Since then, several state regulators have followed, and Nestle said  on Friday that it would temporarily withdraw all Maggi noodles from the country’s shelves, though it reiterated the products were safe.

On Sunday, Goa became the 11th state to impose a ban on its sale. "Since Maggi has been already banned across the country, we have decided not to take a chance and ban it in Goa," Goa Chief Minister Laxmikant Parsekar said.

Delhi, Maharashtra, Punjab, Assam, Bihar, Madhya Pradesh, Tamil Nadu, Jammu and Kashmir, Gujarat and Uttarakhand have banned Maggi noodles.

In a related move, the Confederation of All India Traders (CAIT) urged Health Minister J P Nadda and Food and Consumer Affairs Minister Ram Vilas Paswan to take action against brand ambassadors of Maggi under the FSSAI Act.

In a letter to the two ministers, it said Maggi brand ambassadors have violated Section 24 of the Food Safety & Standards Act (FSSAI) and therefore proceedings must also be initiated against them.

Total Maggi sales in India, including sauces and condiments, account for less than one  per cent of Nestlé’s group annual sales, but brand damage could be significant in a country where the noodles are ubiquitous, in homes and roadside eateries.

Nestlé fielded its global chief executive on Friday to help quell one India’s most high profile food scares in a decade.

Indian newspapers reported separately on Sunday that the national food safety agency planned to inspect all Nestlé’s  manufacturing facilities across India as a result of the scare. Nestlé has eight factories in India, though not all produce Maggi.

Calls to the agency’s office went unanswered on Sunday.