Bharti walmart is the 50:50 Indian joint venture of Walmart-world’s largest retailer- and Bharti Retail -part of India’s largest private telecom operator Bharti Enterprises.

Among the social initiatives undertaken by the company, the retailer has set up an education cum skills development institute with the state state government. This institute, launched in December 2008, hopes to create employment opportunities for the youth in the nearby areas by training them in retailing skills. During training period, trainees receive 100 per cent scholarships from the institute. The institute is expected to provide skilled manpower to the upcoming retail businesses in the organised sector.

The training institute has already churned out 1,200 trained persons, 335 of whom have already been employed in the retail sector. 100 skilled trainees are working with the company’s cash and carry store itself.

Another initiative in the field of education includes adoptation of four Satya Bharti Schools for underprivileged children in Amritsar. Apart from offering free meals, uniforms, and educational materials, employees of the company are also offering their services on voluntary basis to create conducive environment for development of under-privileged children in the adopted schools.

In an another initiative, the company has offered 10 pushcarts to unemployed youth from the rural areas in Amritsar. The economically backward youth will now be able to improve their earnings by supplying fresh produce to their customers after procuring the same at wholesale prices from the company’s cash and carry store. Customers will also be benefited as they will receive products of best quality at best prices at their doorsteps.

Apart from helping under-privileged children and youth, the company has also undertaken a green initiative to improve the environment. Joining hands with Coca-Cola India, the company has planted over 2,000 saplings around its store in Amritsar. The retailer, in partnership with the Amritsar Municipal Corporation, has also adopted the road stretch from Taranwala Bridge up to the end point of Amritsar Municipal Corporation. The company has also agreed to maintain the adopted road stretch.

Talking about the community initiatives undertaken by the company, Raj Jain, Walmart’s CEO in India said, “Bharti Wal-Mart is committed to giving back to the community it serves. These initiatives underscore our belief and culture of caring for the community and the environment. We strongly believe that an efficient and profitable business goes hand-in-hand with being a good steward of the environment and in supporting communities.”

The Index, perhaps a composite number that provides a single measure of environmental information, is expected to tell the consumer as to how a product she is buying affected the planet.

To begin with Walmart will collect information on environmental aspects of products sold in its stores in the US. Walmart will collect information on energy and climate considerations, including material efficiency, natural resources, and how the item in question affects the people and community from where it comes. The information is expected to be collected from 100,000-odd top-tier U.S. suppliers. The survey is likely to be completed by 1st October, this year.

Mike Duke, President and CEO, Walmart, announced details of this initiative at a meeting of Walmart’s 1,500 suppliers.

According to a press statement issued by the company, Walmart will neither own the index nor be responsible for its creation. The information collected by the company, however, will be passed on to a consortium of universities, who are expected to create the ‘product sustainability index.’

While, the index may take several years to reach the consumers, given the clout and influence of the retailer, will have far reaching influences on the way people purchase their products.

“Wal-Mart’s unilateral decision to put its purchasing and communication power behind going green …shows that a single company using its unique clout can accelerate public action to reduce greenhouse gases and reverse climate change,” says Rosabeth Moss Kanter in a recent article entitled “Wal-Mart’s Environmental Game Changer” in a Harvard Business Review article.

According to a FICCI-Technopak report, the sector is expected to grow 4-fold from Rs1.25 lakh crore ($25 billion) sales in 2008 to Rs 4.5 lakh crore ($95 billion) by 2018. Even without the implementation of FDI and GST, though unlikely, the sector will continue to grow at 10-12 per cent annually. According to estimates, the turnover in the next 5 years (by 2013) is expected to rise to Rs 2.06 lakh crore ($47 billion) and in the next 10 years (by 2018) it is expected to rise three-fold to Rs 3.55 lakh crore.

While making wide-ranging recommendations to the government, the FMCG companies and the retailers to put their act together, it has urged the government to rapidly implement GST with a view to replace the multiple indirect taxes currently levied on FMCG products.

While, the report has, on the one hand, asked modern retailers to work with FMCG companies to improve fill rates, better capture consumer and shopper needs, and explore co-branding and co-promotion opportunities, on the other, it has advised traditional retailers (Kiranas) to invest in better customer service, product display and store ambience and invest in infrastructure, particularly for products that require controlled environmental conditions.

“Demand from the rural areas would be instrumental in fueling the growth of FMCG companies in India,” said Amit Mitra, FICCI General Secretary, while releasing the report.

Coming heavily on counterfeit products, which account for nearly 5 per cent of all products produced by the industry, the study has urged the government to enforce trade mark and copyright laws so as to protect the rights of the consumers and FMCG companies. These products while impacting tax collections significantly, also pose serious challenges to the sector’s growth, says the report.

The FMCG sector is among the largest employers in India and livelihood of 13 million people associated with it across 8 million Kiranas are directly depended on it, said Mitra while talking about potential of the sector.
Indirectly, 25 million more people employed at wholesalers, distributors, stockists, etc are also affected with well-being of sector.

The FMCG sector is also one of the major contributor to the exchequer as it contributes Rs 31,000 crore ($6.5 billion) though direct and indirect taxes.

The Confederation of All India Traders (CAIT), a body of traders in the unorganised sector, is seeking immediate implementation of the recommendations made by the Parliamentary Committee on retail trade.

“The recommendations of the Parliamentary Standing Committee headed by Dr Murli Manohar Joshi laid down in Parliament few days back for imposing blanket ban on MNCs and big corporate houses in the retail trade should be adopted by the Government as it is a unanimous document of the Committee comprising members of all political parties,” said Mr Praveen Khandelwal, Secretary-General, CAIT.

According to Khandelwal, the report will prove to be an instrumental document for protecting indigenous trade and employment of crores of people. The report, it may be recalled, has warned of ’far reaching consequences’ of ‘big’ investment on retail trade in India.

CAIT is also asking the government to announce a national trade policy for retail trade in the Budget being presented by the Union Finance Minister Pranab Mukherjee on the 6th July, 2009.

The traders body is also seeking the formation of a National Commission to study the intricacies and issues facing the retail trade in India. CAIT has demanded a proper representation of traders and other retail related sections in the Commission.

The committeee of 40 parliamentarians from all political parties headed by Murli Manohar Joshi, ex-HRD Minister and Senior BJP leader, in its report “Foreign and Domestic Investment in Retail Sector” has sought a ”blanket ban” on Foreign Direct Investment (FDI), as well as investment by heavy weight domestic corporates, in retail sector. The report tabled in the parliament about a fortnight ago has also demanded scrapping the policy of issuing free licences to foreign retailer for setting up ’cash & carry’ wholesale business in India.

It may be relevant to mention in this context here that acoording to the current government policy, while there is a complete ban on FDI in multi-brand front-end retail, there are no restrictions whatsoever on foreign investment in setting up ‘cash & carry’ format wholesale stores in India. Taking advantage of this policy large MNC retailers like the world’s largest US-based Walmart and the world’s fourth largest Germany-based Metro AG have already set shop in India by opening C&C stores either on their own or in partnership with local parties. The other two biggies of the retail industry in the world, namely, Carrefour of France and Tesco of UK are also in the process of foraying into the country through this format.

According to media reports, the Ministry of Corporate Affairs (MCA) is expected to sanction an enquiry within a couple of days to go into the “alleged mismanagement” of funds. The enquiry, in terms of Section 209(A) of the Companies Act, will be conducted by the Registrar of Companies (RoC). The government for the the records has said that it is examining the recommendations of the ROC in this regard.

ICICI Venture, a private equity arm of ICICI Bank, which currently holds 23 per cent stake in the company’s equity, has for several months been demanding an inquiry into the accounts of cash-starved retailer as Subhiksha, on one pretext or the other, has failed to submit its audited accounts to the shareholders and ROC, beyond 31st March, 2007.

The company, founded, promoted, and managed by R Subrahmanian– a first generation IIM/IIT trained entrepreneur– until recently had been operating a retail chain of over 1,600 food, grocery, and telecom, discount stores under the brand name of “Subhiksha” across the country. The company had to suspend operations of these stores in January, 2009, as it was unable to arrange cash required for running the business. The company has defaulted on making payment of salaries for several months to most of its employees. Many employees are believed to be even holding salary cheques that can not be encashed for want of funds in the bank accounts.

Apart from employees, almost every class of creditors including bankers, vendors, service providers, and property owners are seeking to recover their dues amounting to around Rs 750 crore from the beleaguered retailer. The retailer is looking for a Rs 300 crore bailout package to restart its operations. The package, under the Corporate Debt Restructuring (CDR) programme, is being processed by a consortia of 13 banks led by ICICI Bank. The process has to be completed by the lenders before 31st July, 2009, to qualify for assistance under the CDR.

In the meanwhile, Subhiksha, in compliance with the order of the Madras High Court (27th April) has submitted a sealed cover to the court on May 20 containing its financial records. The sealed cover, likely to be opened this week by the court, is believed to be containing 3 years’ balance sheets, list of assets and liabilities, list of banks in which the company has accounts together with their statements. It may be recalled that the Madras High Court in response to the retailer’s prayer had passed an interim order on the 27th April, 2009 to stay the appointment of a provisional liquidator (PL) earlier appointed by the court in terms of the application filed by one of the company’s lenders Kotak Mahindra Bank. Subhiksha had asked for staying of the appointment of the PL as it would have jeopordised the process for sanction of the CDR package that is presently under consideration of the consortia of the lenders.

Subhiksha, the Chennai-based food and grocery retailer, which has suspended operations of all its 1,600-odd stores across the country, since January, this year, on account of cash crunch, has disputed payment of outstanding Provident Fund (PF) to its employees between the period of September and December of 2008. The cash starved company according to a media report has argued that since it has not paid any salaries to its employees for the period, it is not liable for the payment of PF on the same.

“We have said that we have not paid the salaries. Therefore, the provident fund doesn’t become payable till we pay the salaries,” said Prakash Goklaney, lawyer of the company.

The company has obtained a court stay against further proceedings by EPFO– the statutory authority responsible for collection of PF from employers– last month.

“Many of them (the staff) have abandoned…, many of them are not reporting, some of them are on leave without pay. We ourselves don’t know how many (employees) are with us. So there is no question of paying provident funds,” added Goklaney.

Subhiksha has been arguing that it is now left with less than 50 employees on its rolls. As such, its provident fund liability should be assessed on the current staff strength and not on the basis of the staff strength in September when it had around 5,000 employees on its rolls.

It may be recalled that in terms of an ealier assesment/ruling for PF amount of Rs 1.76 crore made by EPFO, Subhiksha’s Managing Director, R Subrahamanian had paid bulk of dues from his own resources. He had paid a sum of Rs 73.87 lakhs lying to the credit of his personal PF account with EPFO, Chennai. Subrahmanian had then asked other promoters (notably, ICICI’s PE arm I-Venture, which holds 23 per cent of equity in the company) to make good the balance demand of the statutory authority as the company was not in a position to pay the same.

Turtle Ltd, Kolkata-based fashion apparel maker that specialises in sale of ‘mass premium’ menswear and accessories, under ‘Turtle’ brand, is close to completing the process of  strategic stake transfer to Kishore Biyani-led Future group within one month. The apparel company, owned by Landasaria family, has for quite sometime been in talks with Future group for strategic investment through partial sale of its equity. Although, terms of the transfer deal, for which the two parties are in talks for some time, have been finalised, the process of actual transfer of stake may take a month.

According to the deal worked out between Turtle and Future, the fashion apparel maker will induct the retailer as a strategic investor, by selling a minority stake (in double digits) in the company.The deal will allow the leading menswear apparel brand to increase its retail presence across the country by shop-in-shop and other format stores in the retail chains operated by Future group. Turtle brand, which earlier was having its major presence in the Eastern states of Assam, West Bengal, Bihar and Orissa, is now availble across the country. The brand is currently sold through more than 1,200 retail points across 400 cities. While, leading retail chains like Central, Globus, Pantaloons, and Shopper’s Stop (which include Future groups chains as well) are already selling Turtle braded apparel, the brand has also set up over 30 exclusive stores under the Turtle World brand. These stores are located in Ahmedabad, Bangalore, Chandigarh, Chennai, Kolkata, Surat, Vadodara, Varanasi, among others.The company is also exporting its products to the middle East, while looking at entering into the lucrative European markets.With a view to increase cost competitiveness of its products, Turtle is also planning to set up a new manufacturing facility for making trousers at Howrah. Currently, trousers manufacturing is outsourced by the company.Conscious of its social responsibilities, Turtle embarked on the task of saving turtles in the country, particularly in Orissa and Gujarat.

]]> http://www.indiaretailbiz.com/blog/2009/05/18/turtles-strategic-sale-of-equity-stake-to-future-group-may-be-completed-within-a-month/feed/ 0 http://www.indiaretailbiz.com/blog/2009/02/26/i-wont-leave-in-the-lurch-promises-subramanian-hopes-to-revive-beleaguered-company-with-the-help-of-sensible-stakeholders/ http://www.indiaretailbiz.com/blog/2009/02/26/i-wont-leave-in-the-lurch-promises-subramanian-hopes-to-revive-beleaguered-company-with-the-help-of-sensible-stakeholders/#comments Thu, 26 Feb 2009 03:00:37 +0000 K http://www.indiaretailbiz.com/blog/2009/02/26/i-wont-leave-in-the-lurch-promises-subramanian-hopes-to-revive-beleaguered-company-with-the-help-of-sensible-stakeholders/

The growing spat between R Subramanian, Founder, Promoter, and Managing Director of Chennai-based beleaguered value retailer Subhiksha, who holds 59 per cent stake in the company, with the private equity partner and second biggest (23 per cent) equity holder I-Venture, is getting murkier every day.

Rubbishing reports of possible take over of control of management of the cash starved company by I-Venture, R. Subramanian said that there was no question of any greater control by the private equity firm than what it has been exercising currently.

Scotching the rumours of his departure from the company, R Subramanian confirmed that he was not looking at evading or escaping from his responsibilities towards the company until the ongoing process of Corporate Debt Restructuring is completed.

“As Managing Director of the company, I owe it all to these people…I won’t leave them in the lurch and walk out when the business is in trouble. We are not made that way and that liberty is possibly only with those people, who are purely financial investors…who have no concern other than the money they make,” said Subramanian in a statement. He was, perhaps, trying to point fingers at the roll being currently played by its minority partner I-Venture, a venture capital arm of the country’s largest private bank ICICI Limited. “We are sure that there are many sensible stakeholders who will work alongside us in the revival of the business, notwithstanding the views of others. We have neither time nor energy for any fight. We have to get the business on track, and we are sure they will join the cause, if not now, some time later.” added Subramanian.

“While we understand that management and ownership are two entirely different things, and actually it may appear tempting to become only a financial stakeholder who can earn profits without doing all the hard work and have no responsibility for trouble, everyone knows that there is a lot to do at this stage to get the CDR through and get the company back on track. While we understand that management and ownership are two entirely different things, and actually it may appear tempting to become only a financial stakeholder who can earn profits without doing all the hard work and have no responsibility for trouble, everyone knows that there is a lot to do at this stage to get the CDR through and get the company back on track.”

Subramanian was, perhaps, responding to a statement made a day earlier by Renuka Ramnath, I-Venture’s Managing Director. She had suggested the need for a professional management to take over. She was miffed at being kept in the dark until as late as September, 2008 about the liquidity problems being faced by the retailer.

“We found that the inventories were very low in stores and the fruits and vegetables vertical had stopped. By the end of October, it was clear that the liquidity problem was far more severe than what the MD had revealed in September, when he asked for the Rs 50-crore loan to tide over a temporary liquidity issue.”

In a clear vote of no confidence, I-Venture has asked for investigations in the financials of the cash strapped company. “The fund (I-Venture) has now approached the registrar of companies (RoC), Chennai, for an investigation into Subhiksha’s operations…We are talking to all the players concerned (ICICI Prudential MF and Azim Premji Investments) and trying to seek a possible solution which will be in the best interest of all, including the employees,” added Ramnath.

Despite, widening rift between the two, Subramanian is hopeful of getting the process of Cash Debt Restructuring getting completed in favour of the retailer, saying:

“We are not one-year wonder. We have been around for 11 years and have done well. It is only that there would be a need to restructure the balance sheet and seek debt re-scheduling and debt forgiveness as part of making the capital structure viable.”

The troubled retailer, which until a few months back was operating the largest number (over 1,600) of discount convenience stores across the country has already shut down all its stores at least until May, 2009. The company is also facing a large number of legal cases filed by vendors, service providers, and employees, among others.

This time the Chennai-based value retailer appears to be in denial mode as it has denied existence of a “new year mail” that is claimed to have been written by its Managing Director R Subramanian to its top management, which sets timeframe,  among others, for payment of outstanding salaries to its employees.

A copy of the “mail” claimed to be in possesion of CNBC-TV18, while describing 2008 as the year of pain, has assured that overdue salaries of its employees for the month of October, 2008, will be paid by very soon.

Incidentally, the timeframe for the payment of overdue salaries and rent, according to the CNBC TV 18 report, was set at 3-4-5 days, and not more.

According to the TV report and a report published in the Times of India, salaries are still due to the retailer’s employees. We are also receiving a number of e-mails from employees seeking information on the status of payment of overdues.

The mail, which is dated January 1, 2009, also describes the last two days of the year as “madly action packed” in which the company had to ensure that bank facilities for Rs 125 crore were not endangered.

While the company has denied existence of such a mail, a spokesperson has written to the nes channel saying, “We do not comment on internal staff issues and all contractual obligations of the organization are met.”

According to the TOI report cited earlier, which has emanated from Nagpur, has said that the company (in the city) “has not paid salary to its employees since last four months. The landlords have not received their monthly rent and the suppliers their payment for months. All the official telephones of the company officials, mobile as well as landlines, are not functioning. The outlets are trying to offload their stock as fast as possible and at some stores goods are being offered at more than 50 % discount.”

In another serious default, according to the said TOI report, a manager of of the company was arrested by Pachpaoli Police when an employee found out that the provident fund account number given to him by the company was fictitious.

3i Infotech, the information technology arm of the country’s largest private sector bank ICICI Limited, has decided to extend the benefits and reach of infotech to rural areas across the country. It has decided to open 12,500 stores in small towns and rural areas under the brand name of ‘I-SERV.’ These stores will provide a number value added services to their customers.

3i Infotech is expected to invest Rs 1-2 lakh and employ 1-3 employees on each of the I-SERV store. The company has decided to earmark Rs 200 crore for the project, which is expected to be completed by the end of 2009. 3i hopes to generate an employment of about 25,000 persons in the rural areas under the venture.

I-SERV is proposing to offer banking, insurance, financial, education, telecom, utility, agricultural, e-commerce and retail, value added services, among others to its rural customers. These services will be made available at a small fee of Rs Five per service to such customers. According to a company release, each household, will have access to a minimum of five such services.

“Rural India houses more than 70% of India’s population and the I-SERV initiative represents a unique opportunity to employ technological capabilities for bridging the existing urban-rural divide. We are extremely proud to be one of the first Indian companies to roll out this initiative at such an enormous level aiming to provide affordable value-added services to the end consumers, thereby transforming the consumers lives at large,” said Anirudh Prabhakarart, Executive Director and President, South Asia, 3i Infotech, while speaking at the launch event.

3i Infotech will initially extend the reach of I-Serv stores to nine states across the country, comprising Uttar Pradesh, Madhya Pradesh, Gujarat, Maharashtra, Goa, Andhra Pradesh, Tamil Nadu, Haryana, and Delhi.

The I-Serv stores will be managed by trained operators. They will be equipped with IT infrastructure including PCs, scanners, Web cameras, photocopiers, and telephones with 24×7 connectivity.

The company is in talks with at least three national and foreign banks for tie-ups and would earn commission per transaction.

 In the interest of objective reporting, we wish to reproduce below a copy of Subhiksha’s reply to a report published earlier by the News Service. The report, among others, had suggested non-payment of salaries to 700 employees working with the retailer across   its 97 stores in Chennai. Yesterday, based on this news report, we had also carried a post on the subject. Hence, we feel obliged to carry the retailer’s reply too the News Service.

A spokesperson of the Subhiksha group has written to the Express group saying:

“We are deeply shocked that the article has been published without any effort to get the facts verified from our side.

We would like to state that several issues have been misrepresented and are factually incorrect.For instance the person called Mithun Banerjee quoted as your source, there has never been such a person in the rolls of the company either in Kolkata or in Chennai.While it is against our policy to specifically comment on employee related issues to the media – [we] would like to point out that the company has in the past and continues to meet all contractual obligations as per norms.

There have been issues related to lapses and pilferage reported in a few stores and consequently salaries of some of the staff from such outlets has been withheld pending audit completion. It appears that your paper has been used by some persons with a vested interest to tarnish our fair name and reputation.”

While, it is entirely possible that the name of the employee mentioned may have been assumed, we have in the meanwhile received a number of comments from different parts of the country from employees claiming to be working for the company, suggesting that the problem is not restricted merely to Chennai. We are carrying some of such comments with a caveat that the same are based on mails received by us and we are not in a position to varify correctness or otherwise of same.

Subhiksha, the Chennai-based India’s largest (in terms of numbers) supermarket value chain,  according to an Express Buzz report, has asked some 700-odd employees from its 97 stores in Chennai, to pick up groceries in lieu of their outstanding dues against non-payment of salaries.

Most of the employees, including two of its Vice Presidents, according to the Buzz, have not been paid their salaries for the past two months.

“In October, we did not receive our salaries. In November, when the salaries were not credited till the 20th, we asked the management about it. The company told us it was facing a financial crisis and asked us to take commodities from the shops,” said Mithun Banerjee, a management graduate from Kolkata, who had joined the company at Kolkata in July, 2007 and was transferred to Chennai in August, 2008.

Even this offer has created a piquant situation for the employees as they find store shelves almost empty as there are hardly any goods left to pick. The reason for disappearance of goods from the shelves is said to be the stoppage of supplies by many vendors, including the country’s largest FMCG player Unilever. These vendors, according to reports, have not been paid dues against earlier supplies.

R. Subramanian, founder and managing director of the company, had earlier attributed low inventories  to introduction of new software package (SAP), saying, “Inventories are a function of rationalisation. In fact, we are deliberately reducing inventories as we are in a transition to SAP (a kind of software). We expect all our stores to convert to SAP by next month.”

Subhiksha, according to unconfirmed reports, is believed to be planning to close some 50 per cent of its stores in the city, and restarting operations by January.

Spencer’s Hypermarket store at 145 Ras Behari Avenue in Gariahat area of Kolkata was again the scene of siege when over a hundred members of Hawkers Sangram Committee stormed the store and forced shoppers to keep off the premises. They were protesting against breach of a tripartite agreement between the retailer, hawkers, and Mayor of Kolkata signed five months ago in July, 2008 before opening of the store.

“The RPG group had promised to abide by the agreement but it has violated it. We condemn the breach and we will not let them operate,” said Murado Sen, Secretary, Hawkers Sangram Committee.

Shaktiman Ghosh, General Secretary of the National Hawkers’ Federation, has threatened to launch a violent agitation, if Spencer’s fails to abide by the terms of the agreement already agreed upon in July, this year.

“We have warned the company and ask them to comply by the regulations. If they do not, then we will launch a fresh agitation and this time it will not be a peaceful one,” said Ghosh. The stir will begin from 25th November.

The genesis of the problem goes back to July, 2008, when Sanjeev Goenka, Vice Chairman, RPG group, was made to abandon the opening of his store by the union leaders, as they were protesting against loss of livelihood security of their members.

The opening of the 36,000 sq ft store could take place only after the intervention of Bikash Ranjan Bhattacharya, Mayor of Kolkata. Bhattacharya could broker peace between the warring parties only after Spencer’s having agreed to sign a tripartite agreement. The agreement had stipulated certain restrictions on sale of several items of daily consumption and use.

According to the agreement, Spencer’s agreed among others to not sell (a) any branded apparel with price of less than Rs 300 per piece (nett of free offers), (b) less than 3 kg quantity of vegetables and fruits, and (c) less than 5 kg quantity of potato and onion. Spencer’s had also agreed to not sell rice, flour or any other agricultural product in loose below 5 kg. Even spices and oils were also not allowed to be sold in less than 500 gm  and 1 litre packs respectively.

The hawkers are also against the issue of trade licences to MNC and corporate retailers. “On November 24, we will organise a rally from Wellington to the KMC to demand identity cards for hawkers, not to give trade licence to foreign and corporate retail giants and to scrap the Urban Renewal Mission Scheme,” said Ghosh.

Target stores, the fifth largest retailer by sales (US$63.367 billion) in the United States, behind Wal-Mart, The Home Depot, Kroger, and Costco, known for its fast, fun and friendly outlook, has agreed to pay $1.745 million (Rs 8.5 crore) in penalties and fees in settlement of a suit filed against the retailer by by several counties, which accused the company for not charging lowest advertised prices to its customers.

Although Target refused to admit the charge of wrongdoing, it agreed to pay compensation to affected consumers and to intiate steps that will ensure no mischarge in future, says a Mercury News report.

Target, according to the court’s judgment, will be required to implement additional audit and price accuracy procedures in its California stores for four years so as to ensure pricing accuracy.

The case was filed based on regular scanner and price inspections by the Department of Weights and Measures in Contra Costa, Marin, Sonoma, Fresno and Santa Cruz, which coordinated their investigations with departments in other counties.

“While scanning errors are more often negligent than intentional misconduct, the result is that consumers are overcharged,” said Contra Costa District Attorney Robert Kochly in a media release.

“Customers should not have to worry about being charged the correct price,” said District Attorney Stephan Passalacqua. “We believe the settlement sends a message.”

Maharashtra FDA, the state government’s regulatory authority for food and drugs, had asked Subhiksha to suspend operations of its warehouses at Bhiwandi (Mumbai) for 20 days as well as had cancelled licences of three of its vendors, charging that they had failed to maintenance health and hygiene norms as  prescribed by the regulator.

The company, had then approached the High Court to intervene in the matter and set aside the suspension order. R. Subramanian, Managing Director, Subhiksha, had then accused its competitors and vested interests as working against genuine interests of the company.

The High Court, which earlier had stayed execution of the FDA’s orders, has now set aside the same.

The HC Bench, according the company, has ordered the Commissioner of FDA to re-decide the matter in accordance with the law.”

Referring to the judgement, R Subramanian has told PTI, “We had challenged the suspension order against our Bhiwandi warehouse and had full faith in the Bombay High court. The judgement has completely vindicated our stance.”