Report No. 105
Further Consideration and Recommendations
6.1. It may not be out of place to mention that the Law Commission in its Eighth Report considered the revision of Sale of Goods Act, 1930. While considering whether any amendment to section 16 of the Act is necessary, the Commission left it to the Union and State Governments whether as a matter of policy, they should undertake legislation, having regard to the observations made by the Commission therein.1 No amendment to that section has been undertaken so far. We shall deal with the Commission's recommendations later on this report.
1. Law Commission of India, Eighth Report.
6.2. At the same time, we feel that the existing law is inadequate and needs to be strengthened to meet a situation where a purchaser intends to ensure about the quality of goods at the time of purchase. It would seem that a law providing not only for certain minimum standards of quality of the goods but also machinery to ensure such standards, is necessary in our country. It should provide for a machinery to get the quality of the goods tested by any interested purchaser.
6.3. As pointed out by the Law Commission1 earlier, there are some Acts which lay down or provide for the making of rules to prescribe standards of quality, such as the Agricultural Produce (Grading and Marketing) Act, 1937 and the Drugs Act, 1940. There are subsequent enactments also, e.g. The Prevention of Food Adulteration Act and the Export (Quality Control and Inspection) Act, 1963. These provide that articles should conform to certain minimum standards. They also provide a penalty if they do not conform to those standards. The Drugs Act prohibits the sale of goods which are not of the standard quality. The Export (Quality Control and Inspection) Act, 1963, inter alia empowers the Government to notify commodities which shall be subject to quality control or inspection or both prior to exports. The State is also empowered to lay down standards to which exported goods have to conform.
1. Law Commission of India, Eighth Report, para 18.
6.4. Standards are laid down by the Indian Standards Institution, set up under the I.S.I. (Classification of Marks) Act, 1952. As pointed out earlier, a large variety of consumer goods are produced now in our country and large number of middle class families purchase them. Some of them, like T.V., Refrigerator, etc. are purchased only once in a way. It is necessary that Parliament enact a law that these electrical gadgets etc. sold in the market conform to minimum standards prescribed under a Parliamentary Act.
6.5. It may be pointed out that Parliament is empowered to make a law with regard to industries, the control of which has been declared by Parliament by law to be expedient in the public interest. It is thus possible for Parliament to control the quality of products of, the industries mentioned in the Schedule to Industries (Development and Regulation) Act, 1951. Just as Parliament made law seeking to ensure the quality of goods meant for export, we recommend that Parliament may enact a law for conforming to quality laid down under the Act in respect of internal trade also. There can be no doubt that Parliament is competent to enact such a law. Such a law would be a reasonable restriction on the right to carry on a business in the public interest.
6.6. The Export (Quality, Control and Inspection) Act, 1963, inter alia, provides that the Export Inspection Council established under the Act, shall advise the Government regarding measures for the enforcement of quality control and inspection in relation to commodities intended for export. Under that Act, the Government may, by notification, establish agencies for quality control or inspection, or both. An agency so appointed by the Government may hold or cause to be held such examination as it thinks fit relating to quality control or inspection of notified commodities either at the time of export or earlier in such testing houses or by such surveyors or samplers as are approved by the Central Government in that behalf. Under that Act the Central Government after consulting the Export Inspection Council notify commodities which shall be subject to quality control or inspection and establish standard specifications for any notified commodity.