The Supreme Court has dismissed the special leave petition filed by FSSAI against a Bombay High Court judgment. The high court, in the Vital Nutraceuticals case, had held that the product approval scheme which was issued through an advisory has no force of law because the procedure laid in Section 92 and 93 was not followed, i.e. it was not placed before Parliament and approval was not taken. Can this judgment have implications on the food industry?
The product approval scheme has been a bone of contention between the food industry and FSSAI. The scheme was launched in 2012 for products that are not standardised by FSSAI, which says non-standardised products cannot be manufactured and sold without approval—for which FSSAI charges a minimum of Rs 25,000. FSSAI argued the same before the Supreme Court, relying on Section 22 of the Food Safety and Standards Act, but this argument was not accepted. Section 22 states that no person shall manufacture, sale, distribute or import novel food, GM food, irradiated food, organic food, dietary food, nutraceuticals, proprietary food, health supplements and other such articles that the central government may notify.
Proprietary food and novel food have been defined to mean an article of food for which standards are not specified but it is not unsafe. Relying on Section 22, FSSAI argued that if the product approval scheme is held invalid, then many products in the market may become prohibited. As per FSSAI, the product approval scheme was launched for the benefit of the industry.
But the Supreme Court refused to buy this argument in the absence of any notification from the Centre. The result of the judgment would be that food business operators are no longer required to obtain product approval for manufacturing, selling or importing a non-standardised food item.
The classic example is Maggi Oats Masala Noodles with Tastemaker, which was banned by FSSAI in the absence of product approval and the same was upheld by the Bombay High Court. Now, Maggi Oats Masala Noodles with Tastemaker can be manufactured and sold without obtaining product approval—at least till the time a notification from the Centre comes up banning list of items or till a product approval scheme is launched through regulation. If the Centre comes out with a notification banning a list of items, then probably nothing survives, but it would be very difficult as this would require application of mind vis-a-vis every kind of food item and simply banning all kinds of proprietary food would never survive judicial scrutiny. The next course can be introducing the product approval scheme through a regulation which will have to undergo public scrutiny as it will have to be placed for public comment. In this scenario, the industry will have sufficient opportunity to highlight the arbitrariness in the scheme.
FSSAI should not take either of these schemes in hurry, as there would be high probability that it would not survive judicial scrutiny. Rather, FSSAI should first create a data of food items, ingredients and additives which are considered safe in India and no product approval should be needed for those products. A product approval scheme should be only for novel food items, ingredients and additives. FSSAI has taken a good step in this regard when it came out with draft notifications providing for food code and amending the additive regulation. If FSSAI puts more effort, the product approval scheme can be made dispute free.
Also, whether any non-standardised food item, ingredient or additive can be manufactured or imported now? In other words, the question before the industry is whether to launch any new product without product approval and whether they can sell those products for which the product approval application is pending or the food item is in use for long. In order to understand this issue, one needs to first understand the concept and principle behind the product approval system. Globally, such a system exists for only novel food items or ingredients. Meaning thereby, from a particular date, the food authority notifies the list of food articles, ingredients and additives etc, which are known to have been used as food and are considered safe, and if any food item, ingredient or additive is sought to be included by food business operator, then he will have to apply for product approval and he would have to pay a fee which would be utilised for the analysing the safety of particular food item. However, FSSAI did not bother to come out with any such updated list of known food items, ingredients and additives; and asked everyone to apply for product approval of even those food items, ingredients and additives which were already in use at the time of the implementation of regulations.
It would be surprising if FSSAI says it has any such data of safe food items or ingredients. So, it would be now the duty of food business operators to keep the aforementioned principle in mind and not to launch any product for which there is no safety data or proof in India. Here, it is important to note that that the data should be related to India and not to other countries. Because, at times, the effect of a food ingredient or additive can be different in different climatic conditions.
So, as on date, food business operators are free to sell products which they had been selling for quite some time, provided no adverse effect has been reported against it. FSSAI had forced many food business operators to obtain product approval even for those food items which they were selling for years without any adverse impact being reported. For the time being, the Supreme Court judgment helps them continue their business without any fear.
It is expected that FSSAI would soon come out with a regulation giving effect to the product approval scheme.
However, this time, it will be first circulated for public comments and then the industry can participate to raise their grievances against the product approval scheme.
The author is an advocate (email@example.com)