India: Bata To Say Tata To Additional Cost Of Carry Bags: A Case Study Of Catena Of Cases Leading To Removal Of Additional Cost On Carry Bags

Last Updated: 31 May 2019
Article by S.S. Rana & Co. Advocates

INTRODUCTION

Following a series of judgements in Chandigarh the additional prices levied by the companies and retailers on carry bag from their consumers has been declared as Unfair Trade Practice.

These judgments attract attentions towards a larger and a more pressing issue at hand. The major reason that compelled the companies to charge for their carry bags: plastic ban due to elephantine increase in plastic pollution, not just at a state level but globally.

Statistics collected by United Nations show that today we, globally produce plastic waste up to 300 Million Tones that is equivalent to the weight of the entire human population. This would mean that the earth is literally brimming plastic. The next question that arises is what is being done with such hefty amounts to plastic. United Nation states that only 9% of this plastic is being recycled, 12% is being incinerated and 79% of this waste is being dumped either in landfills, dumps or natural environment.1

According to FICCI Average per capita consumption of plastic in India is about 11kgs, and is expected to be 20 kgs by 2020 as stated by Ministry of Petroleum and Natural gas.2 Polyethene bags were banned by the National Green Tribunal in India in 2008 and fine of Rs.5,000 was imposed in January, 2016.

Plastic poses a major threat to us even in our day to day lives. Apart from the humongous effect it has on the animals namely, being ingested by animals under the impression that it is food has led to death of many animals. It also however has detrimental effects on the heath of humans as Plastics are made up of a variety of toxic chemicals. As such, its uses and exposure are associated with a number of human health concerns. Chemicals leached from the plastics contain compounds like polybrominated diphenyl ether (PBDE), bisphenol A (BPA), and phthalates. These chemicals have been established to upset the endocrine system and thyroid hormones and can be very destructive to women of reproductive age and young children.3

All this comes to show why plastic ban, especially banning plastic bags in commercial use was banned by the National Green Tribunal.

Chandigarh to Beat Plastic Pollution

In June 2018, the theme of the swatch Baharat mission was beat plastic pollution, in lieu of the same Chandigarh Municipal Corporation conducted various anti plastic raids and awareness drives.4 Various other steps such as nuked nataks, cycle rallies, walk and talk sessions were organized throughout the Union Territory in an event organized by Punjab State Council for Science and Technology in collaboration with the National Diversity Society.5

The other important thing to understand is that the District Consumer Disputes Redressal Forum and The State Consumer Disputes Redressal Forum declared that charging of additional free on carry bags is an Unfair Trade Practice.

Unfair Trade Practice

In today's cut throat world, where competitive edge is the main aim of companies to enable to perform and come out on top. Unfair Trade Practice is a malpractice that is being breaded due to this strive for an edge.

Unfair Trade Practices extensively explains any deceitful, misleading or deceptive exchange practice; or business deception of the items or administrations that are constantly sold; which is disallowed by a statute or has been perceived as significant under law by a judgment of the court. Generally unfair trade practices may include illegally refusing any transaction, deceptively soliciting customers, disrupting business activities of the rivals unfairly, unfairly excluding competitors.6

The judgment of Chandigarh Consumer Forum dated 09/04/2019 imposed a penalty on the infamous shoe store BATA, for charging its consumers Rs. 3 for a shopping bag to carry their purchases home. The evolution of the same can be traced back to another case. The detailed study of the two has been provided below.

CASE: Mr. Pankaj Chandgothia v. M/S Lifestyle International Pvt. Ltd. (Chandigarh Consumer District Dispute Redressal Forum- 1)

In this case penalty of Rs. 10,000 was imposed on the Retail Giant Lifestyle in lieu of charging Rs. 5 as an additional cost for carry bags.

FACTS:-

  • The complaint was filed by the Complainant Mr. Pankaj Chandgothia (hereinafter referred to as "the Complainant") against Lifestyle International Pvt. Ltd. (hereinafter referred to as "the Opposite Party") in the Chandigarh Consumer District Dispute Redressal Forum- 1 (hereinafter referred to as "the Forum").
  • The Opposite Party is a major retail fashion brand which comes under the Dubai based retail and hospitality conglomerate, the Landmark Group. In India, Lifestyle Store is a is a part of Lifestyle International Pvt. Ltd, with sister brands Home Centre, Max, and Easybuy.7
  • The Complainant alleged that while buying items from the Lifestyle Store he was asked to pay an additional amount of Rs. 5 for a carry bag. No prior information was given regarding the same, as it was nowhere mentioned in the store that an additional cost would be imposed for a carry bag. Aggrieved by the same a complaint was preferred to the Forum.

COMPLAINANT'S CONTENTIONS:-

  • The Complainant asserted that nowhere in the entire store was there a mention that the purchasers or the buyers would be charged additionally for the carry bags and the same was informed to them only at the cash counter.
  • The Complainant also alleged that that the same amounts to deficiency in service and Unfair Trade Practice.

OPPOSITE PARTY'S CONTENTIONS:-

  • The Opposite Party contended that there is no necessity on its behalf to provide the buyers or the purchasers with a free shopping bag.
  • The Opposite Part also alleged that the bags were given to the Complainant or any other buyer only after confirmation was taken from them regarding the same.
  • The Opposite Party contended that following the plastic ban the company started to provide paper bags to the customer, which were costlier than the plastic bags, hence it was providing the same to the customers on payment of a certain price.
  • The Opposite Party also contended that since there is per se no legal obligation on the Party to provide the bags free of cost to its customers hence there is no deficiency in practice or Unfair Trade Practice.

THE FORUM'S ANALYSIS

After considering the contentions of both the parties the Forum remarked as follows:

  • The court first stated that the factum of providing paper bags to its customers, on payment of additional price, has not been disputed before the forum. The contention of the Complainant that nowhere in the store was it mentioned that the customers would be charged additionally for the carry bags, has neither been refuted nor admitted by the Opposite Party.
  • The Opposite Party also could not by way of any rules/instructions show any evidence that they were allowed to levy an additional charge for paper bags.
  • The contention of the Opposite Party that the carry bad was given only after the assent was taken from the purchaser did not sit well with the Forum, the Forum observed that,

    "8. .....we are not impressed with the same, in as much as if the Cashier informed the Complainants about the purchase of carry bag before billing, the same amounts to unfair trade practice and deficiency in service as it would have been very odd and inconvenient to the Complainants to carry the new garments in hand throughout without a carry bag. In this backdrop, charges of such things (paper bags) cannot be separately foisted upon the consumers and would amount to overcharging."
  • The contention of the Opposite Party that the charging for paper bags was in lieu of the plastic ban was also not accepted by the court and the same was reprimanded on the account that the court felt that the ban of a product does not entitle the Opposite party to charge for its substitute, it stated,

    "9. The Opposite Party has also argued that post ban of plastic bags, it started providing paper bags to its customers on payment of its price. However, we feel that banning of a product does not entitle the Opposite Party to charge for its substitute and the Opposite Party and all other shops like it are obliged to provide carry bags free of cost to carry the purchased items to their customers, as the customers cannot be expected to carry the items in hands."
  • Another aspect pointed out by the Forum was that the paper bags that were being provided to the customers at an additional cost, contained the name of the brand and acted as an advertising strategy for them, hence the forum held that this leads to exploitation of gullible customers and indeed amounts to Unfair Trade Practice.

    "10. It is noteworthy that said carry bag for which the Complainants had to shell out extra amount from their pocket, is a printed carry bag on both sides, which has a prominent display of the advertisement of the Opposite Party and is thus apparently serving as an advertisement for them, whenever the said bag is carried by the Consumer. In this manner, the Complainants and other gullible consumers like them have certainly been taken for a ride by the Opposite Party for advertising their name. Undoubtedly, the Opposite Party has several stores across the country and in the above said manner, made lot of money, thus, the act of Opposite Party by forcing the gullible consumers to pay additionally for the paper bags is surely and certainly amounts to deficiency in service and its indulgence into unfair trade practice."
  • In pursuance of the same the Opposite Party was penalized with cost of Rs. 10,000/- and was directed to provide free shopping bags to all its customers who purchase something from their store, to refund the amount or Rs 5 wrongly charged from the Complainant and also to pay the Complainant Rs. 1,500 towards compensation for harassment and agony and Rs. 1,500 as litigation expense.

CASE: Lifestyle International Pvt. Ltd. V. Mr. Pankaj Chandgothia (State Consumer Disputes Redressal Commission,U.T., Chandigarh, March 18, 2019)

FACTS: -

  • This was an appeal that was filed by Lifestyle International Pvt. Ltd. against the order of the Forum passed against it on January 03, 2019, to the State Consumer Redressal Dispute Redressal Commission, Chandigarh (hereinafter referred to as "the State Forum")
  • In the said appeal Lifestyle International Pvt. Ltd has preferred the appeal (hereinafter referred to as "the Appellant", against Mr. Pankaj Chandgothia (hereinafter referred to as "the Respondent")
  • The facts of this case are the same as that of the previous one with no substantial addition in that regard.

CONTENTION OF THE APPELLANT:-

  • The Appellant contented that it does not fall within the definition of "service" under section 2 (1) (o) of the Consumer Protection Act as it is a retail store.
  • The Appellant also contended that in light of Rule 10 of The Plastic Waste (Management And Handling) Rules, 2011, which provides:

    "Explicit pricing of carry bags. - No carry bag shall be made available free of cost by retailers to consumers. The concerned municipal authority may by notification determine the minimum price for carry bags depending upon their quality and size which covers their material and waste management cost in order to encourage their re-use so as to minimize plastic waste generation."

    Hence in light of the same the Appellant contended they are under the obligation to not provide any carry bag free of cost to any customer.
  • Another point raise by the Appellant was that the Rule 15 of The Plastic Waste ( Management And Handling) Rules, 2016, published vide notification dated 18.03.2016, which reads as follows:

    "Explicit pricing of carry bags.- (1) The shopkeepers and street vendors willing to provide plastic carry bags for dispensing any commodity shall register with local body. The local body shall, within a period of six months from the date of final publication of these rules in the Official Gazettee of India notification of these rules, by notification or an order under their appropriate state statute or byelaws shall make provisions for such registration on payment of plastic waste management fee of minimum rupees forty eight thousand @rupees for thousand per month. The concerned local body may prescribe higher plastic waste management fee, depending upon the sale capacity. The registered shop keepers shall display at prominent place that plastic carry bags are given on payment."

    In pursuance of the same the retailers have been barred from making plastic bags available to the customers free of cost and it is thus mandatory for the retailers to charge the customers for plastic carry bags.
  • The Appellant also alleged that the impugned order passed by the Forum which opined that it is mandatory for the retailers to provide carry bags free of cost is without any basis and is faulty.
  • The Appellant also alleged that that the Forum failed to appreciate that in absence of any law prohibiting the sale of carry bags, the Appellant/opposite party was well within the bounds of law to charge for the same. It was further contended that on the amount collected through the sale of carry bags, the Appellant/opposite party pays the Government the requisite taxes, which fact the Forum also failed to appreciate.

CONTENTION OF THE RESPONDENT:-

  • The Responded contended that the Rule 15 of The Plastic Waste (Management And Handling) Rules, 2016 has been omitted vide notification dated March 27, 2018.
  • The Respondent also alleged that nowhere was it mentioned that the customers will have to pay an additional amount for the carry bags and nor was it mention that the customers are allowed to carry their own carry bags inside the store.

THE STATE FORUM'S DECISION

While dismissing the appeal the court opined that:

  • The State Forum stated that the Respondent without a speck of a doubt comes under the definition of a consumer as provided under section 2 (1) (d) of the Act hence the Appellant is a service provider in that regard.
  • The State Forum also held that Rules 10 and 15 of the, The Plastic Waste (Management And Handling) Rules are concerned the same stand amended and omitted via notification dated March 18, 2016 and March 27, 2018 respectively, hence the Appellant could not take cover under the said provisions.
  • The State Forum observed that charging for carry bags was completely against consumerism. The State Forum also said that, it was nowhere mentioned in the entire store that the carry bags would be charged additionally to the purchase and nowadays it is a prevalent practice the customers are not allowed to carry their own carry bags into the store, the same are either taken by the guard at the entry gate or stapled so that no additional item can be put into them.

CASE: Dinesh Prasad Raturi V. Bata India Limited. (District Consumer Disputes Redressal Forum-I, U.T. Chandigarh, April 09, 2019)

This was a complaint filed against the widely known Shoe Company Bata India Limited, for charging Rs. 3 additionally, for a carry bag, in the District Consumer Disputes Redressal Forum-I, U.T. Chandigarh. Punitive damages amounting to Rs. 5,000 were imposed on the Company.

FACTS:-

  • The complaint was filed by the Complainant Mr. Dinesh Prasad Raturi (hereinafter referred to as "the Complainant") against Bata India Limited (hereinafter referred to as "the Opposite Party") in the District Consumer Disputes Redressal Forum-I, U.T. Chandigarh (hereinafter referred to as "the Forum").
  • The Opposite Party is the largest retailer and leading manufacturer of footwear in India and is a part of the Bata Shoe Organization. The Company also operates a large non retail distribution network through its urban wholesale division and caters to millions of customers through over 30,000 dealers.8
  • The Complainant alleged that on buying shoes worth Rs. 399 from the Bata Store he was billed an additional amount of Rs. 3, for a carry bag, which the Complainant had no intention of buying. The carry bag bore the name of the shop 'BATA' with a tag line ' Bata Surprisingly Stylish' "Barcelona Milan Singapore New Delhi Rome".

CONTENTION OF THE COMPLAINANT:-

  • The Complainant contended that he had no intention to purchase the carry bag.
  • The Complainant also alleged that the brand name of the Opposite Party along with its tagline was printed on the carry bag, making it a form of advertisement for which the consumers were being wrongly charged, hence it is a form of Unfair Trade Practice.

CONTENTION OF THE OPPOSITE PARTY:-

  • The Opposite Party contended that it was in lieu of environmental safety, that the Complainant was the carry bag at the cost of Rs. 3.

ANALYSIS OF THE DECSION OF THE FORUM

In light of the arguments advance of the Complainant and the Other Party the Forum opined that:

  • The Forum held that the carry bag was indeed a form of advertisement by the company and stated,

    "5. We had also a glance to the carry bag which is annexed with the consumer complaint in which advertisement of Bata Company was being published as it has been printed in red words "Bata Surprisingly Stylish" which shows that Bata Company is stylish in nature and used the consumer as if he is the advertisement agent of Opposite Party. The purchase of the item along with sale of carry bag is not disputed as per statement put forth by Opposite Party."
  • The Forum also concluded that charging Rs. 3, for the shopping bag is a form of Unfair Trade Practice employed by the company, and stated,

    " 6. Per this evidence brought on record, we record a firm finding that there is unfair trade practice on the part of Opposite Party in compelling the Complainant to purchase the carry bag worth Rs.3/- and if the Opposite Party is an environmental activist, he should have given the same to the Complainant free of cost. It was for gain of OP. By employing unfair trade practice, OP is minting lot of money from all customers."
  • The Forum instructed the Opposite Party to provide carry bags free of cost to all the customers who purchase articles from their shop, to refund Rs. 3 wrongly charged from the Complainant and to pay Rs. 3000 to the Complainant as compensation for mental and physical harassment, and to pay Rs. 1000 for the litigation expenses. The court also directed the Respondent to pay punitive damages amounting to Rs. 5000 to the Consumer Legal Aid Account.

CONCLUSION

The decision passed by the Forums raise a rather substantial question that in light of the havoc that the plastic pollution has caused not just in our country but globally where do decisions not promoting use of non-disposable bags stand?

Though the catena of decisions discussed above are in the favor of the consumer but are they in favor of the environment? Though there is an imposition on a ban of plastic bags which forces the companies and retailers to switch to paper bags, making these paper bags free is a double-edged sward, where it has its benefits, it also finds some flaws.

Making the paper bags free is a major win for the consumer as they were being used as marketing tools, as the companies had they brand logo printed on the bags and the same was being circulated and used by the consumers and they were additionally being asked to pay for them. The rationale behind the decisions is very simple and logical, when a consumer buys products from a store can he be expected to carry all these products by hand, especially if it has not been mentioned anywhere in the store and the consumer becomes aware of it only when he reaches the cash counter, that he will be charged additionally for the carry bags.

The cons of these decisions is however that though it is not pro retailers it is also not pro-environment. It is a settled fact that plastic is a major threat to our environment, but it is also true that paper wastage is another leading factor towards detriment of our environment. The previous store policy to charge for paper bags, in a way encouraged the buyers to carry their own bags from home when going shopping. This trend is highly prevalent in grocery stores where no carry bags are provided, and the customers carry bags from their own home to carry their groceries. It is not unimaginable that people develop a habit or carrying carry bags when leaving for shopping. This would be both pro-consumer and pro-environment.

The decision could does lift the veil of environment protection claimed by the companies for free or rather consumer sponsored advertisement and prevents unnecessary harassment of the gullible consumers.

A more consumer and environment friendly approach can be to offer other incentives to the buyers on bringing their own carry bags, which would encourage the customers go get their own bags.

Implementation of such programs can be more beneficial for: the consumer, the companies and retailers and the environment which is in congruence with our sustainable development goal: development but not at all costs.

Footnotes

1. https://www.unenvironment.org/interactive/beat-plastic-pollution/

2. https://www.teriin.org/sites/default/files/files/factsheet.pdf

3. https://www.eartheclipse.com/pollution/fatal-effects-of-plastic-pollution.html

4. https://www.tribuneindia.com/news/chandigarh/mc-holds-awareness-drives-against-plastic-pollution/602496.html

5. https://timesofindia.indiatimes.com/city/chandigarh/enthusiasts-cycle-to-drive-plastic-out-of-chandigarh/articleshow/64433094.cms

6. http://jcil.lsyndicate.com/wp-content/uploads/2018/08/A-STUDY-ON-UNFAIR-TRADE-PRACTICES-IN-INDIA-8.pdf

7. https://en.wikipedia.org/wiki/Lifestyle_(department_store)

8. https://www.bata.in/bataindia/a-20_s-179_c-42/about-us.html

For further information please contact at S.S Rana & Co. email: info@ssrana.in or call at (+91- 11 4012 3000). Our website can be accessed at www.ssrana.in

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