In Brief
Hotels and restaurants challenged enforcement actions for charging prices above the Maximum Retail Price (MRP) printed on packaged water bottles served to customers. The Supreme Court held that the Standards of Weights and Measures Act, 1976 and the Legal Metrology Act, 2009 do not apply to composite transactions in hotels and restaurants where service is the dominant element. The definition of 'sale' in both Acts refers only to transfer of goods, not to indivisible service-cum-sale contracts. Therefore, hotels and restaurants may charge prices above MRP for incidentally supplied packaged water as part of their hospitality service. The appeals were allowed and High Court judgments set aside.
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