The main legal point established is that the SWM Acts and Rules do not apply to interdict the sale of mineral water in hotels and restaurants at prices above MRP, as the Acts primarily focus on standardizing weights and measures for defined goods and ensuring consumer protection.

JUDGMENT :

R.F. Nariman, J.

Leave granted.

2. The present appeals arise out of Writ Petition (C) No. 6517/2003 filed by the Federation of Hotel and Restaurant Associations of India in the High Court of Delhi, seeking a declaration that the provisions of the Standards of Weights and Measures Act, 1976, the Standards of Weights and Measures (Enforcement) Act, 1985 and the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 are not applicable to services rendered in the premises of hotels/restaurants.

3. The appellant's main concern was that the Controller of Weights and Measures was seeking to proceed against the hotels and restaurants of the appellant-Association for charging a price higher than the printed Maximum Retail Price ("MRP" in short) for supply of packaged water bottles during services provided to their customers while in the hotels and restaurants. The appellants plead in the Writ Petition that the transaction consisting predominantly of a service, and not of a sale of drinking water, consisted of a composite charge which included incidental charges for food, drinks etc. The challenge in the Writ Petition resulted in a judgment by the learned Single Judge dated 05.03.2007. The judgment of the learned Single Judge referred to and relied upon the decisions in The State of Punjab v. M/s. Associated Hotels of India Ltd. (1972) 1 SCC 472, Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi, [1979] 1 SCR 557 and the review judgment in the latter case reported in (1980) 2 SCC 167. After discussing these judgments in detail, and considering the statement of objects and reasons of the Standards of Weights and Measures Act, the learned Single Judge finally held:

"16. In the above analysis I hold that charging prices for mineral water in excess of MRP printed on the packaging, during the service of customers in hotels and restaurants does not violate any of the provisions of the SWM Act as this does not constitute a sale or transfer of these commodities by the hotelier or Restaurateur to its customers. The customer does not enter a hotel or a restaurant to make a simple purchase of these commodities. It may well be that a client would order nothing beyond a bottle of water or a beverage, but his direct purpose in doing so would clearly travel to enjoying the ambience available therein and incidentally to the ordering of any article for consumption. Can there by any justifiable reason for the Court or Commission to interdict the sale of bottled mineral water other than at a certain price, and ignore the relatively exorbitant charge for a cup of tea or coffee. The response to this rhetorical query cannot but be in the negative. Although the vires of Rule 23 have been assailed, I do not find it necessary to answer that challenge since the provision relates to sales between dealers and neither the hotels and restaurants of the one part and customers of the other falls within this categorization."

4. In a Letters Patent Appeal filed before the Delhi High Court, by a judgment dated 11.02.2015, the Division Bench recorded that the counsel for the writ petitioners was agreeable to disposing of the appeals in a particular manner and accordingly, the appeals were disposed of in such manner. Paras 16 & 17 of this judgment are set out herein below:

"16. The counsel for the writ petitioners is agreeable to our disposing of these appeals with observations that the judgment of the learned Single Judge shall not come in the way of the appellant enforcing the provisions of the new Act even if identical or similar to the old Act and it being left to be adjudicated in the proceedings if any initiated under the new Act whether hotels/restaurants, are entitled to do so or not.

17. We accordingly dispose of these appeals in following terms:

A. Owing to the change in law, there is no need to set aside or affirm the judgment of the learned Single Judge.

B. However the question of law adjudicated by the learned Single Judge is left op