Goods sold must
mention cost price too
Member of Parliament has attempted to do, through a private memberís
Bill, what the government could not or would not do: make it
mandatory for manufacturers to print on all packages not just the
maximum retail price (MRP), but also the cost of production.
"Consumer Goods (Mandatory printing of cost of production and
maximum retail price) Bill, 2006, the Bill (57 of 2006) introduced
in the Lok Sabha by Hansraj Gangaramji Ahir on April 27, says that
"no person shall sell or cause to be sold, any consumer goods
without the cost of production and MRP of the product printed on
such product after the expiry of six months from the date of
coming into force of this Act".
There is also a
provision in the Bill to receive consumer complaints pertaining to
violations and, after due enquiry, cancellation of the licence of
the manufacturer for selling without printing the relevant
information about the cost of production. The Bill also provides
for punishing of violators with simple imprisonment for a term not
less than one year and with a fine not less than Rs 1 lakh.
Says the MP, in the
"Statement of Objects and Reasons" accompanying the
Bill: "It is generally seen that the prices of consumer goods
sold in the markets are determined arbitrarily by the
manufacturers. In this process, the manufacturers gain huge
profits as the actual manufacturing cost is very low. The
consumersí interests are compromised and they are compelled to
buy goods at much higher prices in comparison to actual
manufacturing cost of goods. Thus, consumers are subjected to
potato chips, drinking water, soft drinks, automobiles, medicines,
etc are being sold at a price much higher than their cost price.
The manufacturers arbitrarily fix the prices and the consumers are
compelled to purchase goods at higher costs. If it is made
mandatory for the manufacturers to print the actual cost of
production of goods along with their MRP, it will help to curb the
greed of the manufacturers. Such a measure will also help the
consumers in making a decision regarding buying the product.
"It is the duty
of the government to bring a legislation for protecting the
interests of consumers. In the wake of economic liberalisation, it
has become essential that the consumers are given the right to
know the actual manufacturing cost of the goods they are going to
purchase. It is also in the public interest to make commodities
and goods available at fair prices to consumers. The interests of
consumers can be protected against the vice of profiteering by
making the goods and commodities available to them at a reasonable
consumers, this is not a Bill introduced by the government, but by
an MP as a private memberís Bill. And such Bills generally never
get passed by Parliament to become a law. Usually, the government
requests the member to withdraw the Bill and if he refuses to do
so, the government gets enough number of MPs and ensures the
defeat of such legislation.
However, there is
one positive factor here. Usually, when an MP introduces a Bill as
a private memberís Bill, he or she draws the attention of the
government to the need for such a law and the government may well
bring the necessary amendment on the lines of the Bill introduced
by the private member. So one hopes that this particular Bill too
will serve that purpose and force the government to act.
For a number of
years, consumers and consumer groups have been demanding that the
manufacturers print on all packages, not just the MRP, but also
the ex-factory price. The logic being that the ex-factory price
will introduce transparency in the pricing of goods, while at the
same time preventing printing of inflated MRPs by manufacturers.
Further, consumers have a right to information and this is an
essential information that they would like to have.
course, are vehemently opposed to this. In fact the Union Ministry
of Consumer Affairs constituted several committees to discuss the
issue and in all these committees, barring the representatives of
manufacturers, all others felt that printing the ex-factory price
was the best solution to the problem of inflated MRPs being marked
on certain goods by manufacturers.
Now, marking the MRP,
inclusive of all taxes, is mandatory under the Weights and
Measures (Packaged Commodities) Rules. And if the manufacturers
have to print the ex-factory price, too, these rules have to be
amended. However, on account of the strong resistance form the
manufacturersí lobby, the government has not done it.