High Court relief for Tata Starbucks as release of syrups get nod

In a relief to Tata Starbucks Company, the Bombay high court directed the customs department at Nhava Sheva port to release a consignment of flavoured syrups used by the coffee chain to prepare its beverages. Imported from USA, the consignment was stopped at the port after the Food Safety and Standards Authority of India refused to grant a No Objection Certificate (NOC).

In its order, a division bench of justices VM Kanade and AK Menon, allowed the company to take the consignment which has already arrived and is kept at the port. "In our view, instead of complying with the provisions of the Act and Rules and Regulations framed thereunder, they have acted in an arbitrary and capricious manner and detained the goods of the petitioner (Starbucks)."

Starbucks is a joint venture company of Tata Global Beverages Limited and Emerald City CV, which is an affiliate of Starbucks Corporation, USA. The company operates Starbucks Cafes in which speciality coffees, coffee beverages and other items are sold in India. Around 43 such cafes are in operation all over the country.

The consignment was stopped at the port in February after the authority claimed that the flavoured syrups did not meet the requirements laid down under the Food Safety and Standards (Food Product Standards and Food Additives) Regulations, 2011.

Appearing for the company, senior counsel Iqbal Chagla argued that the syrups do not contain 65 per cent of soluble solids and thus is a proprietary food (a food that has not been standardised under these regulations) under the category, and since it is used as an additive in flavoured beverages it is not sold to the consumers directly. Thus, the regulations would not apply to the product.

It was also argued that the company has been importing these products since July 2012 and they have been cleared for almost two years. After February 2014, all the consignments have been detained at the port.

Appearing for the authority, advocate Mohammed Pracha argued: "The regulations are formed to avoid dumping of sub-standard goods into India and thus causing a health hazard to the public at large."

The court, however, observed, "It is not stated by the respondents that these products are unsafe for human consumption. It is also an admitted position that in respect of number of proprietary foods, no standard has yet been fixed by them."