Port Blair, Nov 27 2020
Nicobar District of Andaman and Nicobar Islands is one of the remotest districts of the country. Indira Point, the Southernmost Point of India is located in Great Nicobar Island of Nicobar District. The whole district is classified as a tribal reserve except for some parts of Great Nicobar.
Very often complaints are received from travellers, researchers and people who travel to the Nicobar District for the first time, about the shopkeepers charging them an amount above the MRP for some products. These complainants who have raised their concerns publicly on Social Media and during conversations with people, often term it as an unfair trade practice.
The reality is far too different. It would be unfair to the shopkeepers of Nicobar District if they are asked to sell all the goods at the Maximum Retail Price. There are two points of view to the same issue, the first is the consumer point of view and the second is the shopkeeper’s point of view.
In India section 36 of the Legal Metrology Act, 2009, provides punishment for sale of the pre-packaged commodity which does not conform to the declaration on the package. The punishment for the offence ranges from a fine of Rs. 25,000/- for the first offence to a fine of Rs. 50,000/- to Rs. 1,00000/- or imprisonment of 1 year or both, in case of subsequent offences.
The law is very strong and clear, there are several examples where the Shopkeepers have been fined heavily by the courts for their unfair trade practices in other States and UT’s of India.
When the consumer point of view is considered, it seems appropriate for them to complain and resort to legal remedies, when they are charged more than the MRP for pre-packed commodities. The real consideration here should be given to the shopkeeper’s point of view when such complaint is filed or publicly raised against any shopkeeper of the Nicobar District.
The reason why the shopkeepers of Nicobar District often sell some commodities over and above the MRP printed on them is that the import price of these commodities exceed the MRP when these products are transported to the Nicobar Group of Islands.
Car Nicobar is approximately 247 Km from Port Blair, Nancowry is almost 415 Km from Port Blair and Campbell Bay is approximately 529 Km from Port Blair, these are the three main residential areas of Nicobar District with a considerable population. The logistics of transportation of cargo from Port Blair to these Islands are very complicated. All the cargo including all the pre-packed commodities is transported from Port Blair to these Islands on ships.
The goods are first ordered by the shopkeeper from a wholesaler in Port Blair, the wholesaler repacks the goods and the cargo tickets for transportation of these goods are also obtained by the wholesaler. The wholesaler then contracts another agency to transport the goods to the Jetty and to load it on the ships. After loading the cargo on the ships the wholesaler raises bill to the shopkeeper. The bill includes the price of the commodities purchased, re-packing charges with the price of all the materials used for repacking, the cargo freight charges, the price paid to the agency to transport goods to the jetty and to load it.
After that the goods are transported to the respective Island, an agency unloads the goods from the ships, which are then transported to the shopkeepers. Here the shopkeeper is billed for the unloading as well as for local transportation.
In South Andaman and North and Middle Andaman District, the shopkeepers get goods delivered to their doorsteps without even moving a finger and without incurring any charges. Most of the goods are door delivered to the shopkeepers by distributors of the products in the other two districts except for Nicobar District. Further, these distributors also take back the damaged goods and the shopkeepers do not incur any losses because of damages. Most of the distributors also take back the unsold and expired goods from the shopkeepers and exchange them for new ones or a different product.
The shopkeepers of Nicobar District, however, suffers a lot because the distributors of goods, do not provide transportation and delivery services in Nicobar District. The commission on many packed commodities are very meagre and most of the packed commodity exceeds the MRP printed on them when it reaches the shopkeepers in Nicobar District.
The misery of a shopkeeper of Nicobar District doesn’t end there, they further face losses on accounts of damages caused while transporting, since the distributors and wholesalers do not take back the damaged goods from shopkeepers of Nicobar District on account of the high transportation and repacking charges.
An example of a bottle of Cola will better demonstrate the misery of these Shopkeepers of Nicobar District. Let’s say a 2-litre bottle of Cola has a margin of about Rs. 10 and the MRP printed on it is Rs. 95/-. The price of cola for the shopkeepers in the wholesale market in Port Blair is Rs. 85/- (after reducing the margin offered by the wholesalers). This cola comes in a 9 bottle wholesale pack. For transportation, to Campbell Bay, two such wholesale packs needs to be repacked together. The repacking is done with cartons and plastic bags. The plastic bags and other materials for repacking costs a lot. The margin on the wholesale purchase, of two wholesale packs of this cola, is Rs. 180/- for the shopkeeper at Port Blair. When this cola reaches Campbell Bay, the repacking cost, transportation cost to Jetty, Loading Charges, Freight Charges, Unloading Charges, Local Transportation charges exceed more than Rs. 180/- and reaches up to Rs. 200/-. At this stage, if the shopkeeper sells a bottle of cola in Campbell Bay on MRP he will incur a loss of Rs. 1.11/- per bottle.
Further, let us take into account the damages. Suppose 1 bottle of 2-litre cola gets damaged because of a hook by an unloading worker. The shopkeeper now looses the initial wholesale cost of the bottle of cola i.e. Rs. 85/- plus the repacking, transportation and other charges incurred on that particular bottle of cola, which in this case would be Rs. 11.1/- per bottle. The total amount of loss now stands at Rs. 96.11/-. Dividing this loss amount among the other 17 bottles of cola which he can sell is the only practical solution available for him to offset his losses. The cost of each bottle of cola at Campbell Bay now without any added profit for the shopkeeper will stand at Rs. 100.6/-, which is Rs 5.6/- above the printed MRP.
The shopkeepers of these Islands of Nicobar group have the choice of deciding on not selling these products which exceed their MRP on reaching their destination, but that would mean that these products would not be available in the markets of these Islands, which is not good for the consumers.
Some of the other solutions to this problem needs perusal by the A & N Administration. One such solution is to increase the MRP of these products for Nicobar District. It is a very common practice for manufacturers to prescribe different MRP for different regions. Nowadays several products come with different MRP prescribed. The usual practice is that manufacturers mention the MRP for a particular area and also the MRP for the rest of India, on the same product. Nicobar Times found pre-packaged milkshake in the markets of Port Blair with a separate MRP for Jammu & Kashmir, A & N Islands and a separate MRP for rest of India. To implement this method, Andaman and Nicobar Administration will have to thoroughly peruse the issue with the distributors and manufacturers.
The first step that could be taken is identifying such products with the help of traders and shopkeepers of Nicobar District and then taking it up at the appropriate level.
Another step that needs to be taken for the Nicobar Group of Islands is the introduction of cargo transportation in shipping containers. The present practice of loading and unloading the cargo in the hatch of the ship causes a lot of damage to the products, which is one factor for the increase in the price of the commodities. Containerised transport of cargo to Nicobar District will help reduce the burden of damages and will bring down the cost significantly.
Overall, charging an amount more than the prescribed MRP for pre-packed commodities by the Shopkeepers of Nicobar District is not to indulge in unfair trade practice to maximise their profits, but it is their helplessness and only hope to reduce their losses.
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That cannot be a reason to sell at higher price. That is admin issue which shd be sorted out by the govt. There are a lot of places in India where basic transportation is not available but there also the price is not more than MRP.